phillipines

Interesting that BHP have agreed to pay for a seismic on OEL Phillipine permit with an option to farm in and take 60% stake. It seems that there is at least something of interest in these waters as the cost of the 2 wells if they execrise the option would be $100 million plus back costs.

Latest from Euroz - post quarterly no change in valuation target 142( bought down to these levels due to contingency for litigation)


Investment Case:
Tap is fundamentally undervalued with the potential for large upside from its drilling program.

FY11 is shaping up to be a big year for Tap on the exploration and appraisal front with up to 10 high impact wells on the schedule.

The remainder of the upcoming drilling program (outside WA-351-P and Brunei) will be mostly a mixture of large oil and gas prospects on the North West Shelf, Bass Basin and Philippines. We expect some farm outs will eventuate to give a FY11 exploration budget in the order of our forecast of $35m. We note that most of the drilling activity planned is not commitment driven allowing discretion to fit to its budget.

Tap provides exposure to strong WA gas prices through its resale of gas from the John Brookes JV. This will net Tap ~$20m / yr cash flow for up to 10 years supporting a base load exploration spend.


Also looks like Londoner "Hangman" that he saw on the charts may be about to get hung himself