rogermontgomery.com, page-7

Loved the comment about shale gas being a ponzi scheme lol. Well this scheme has Exxon Mobil, Chesapeake, Anardarko, BP, British Gas, Shell, BHP Billiton all being part of the scheme seriously the valuation technique roger is using only works for old technology conventional businesses.

But that is the beautiful thing about investing in companies like AUT,TXN ect many people will misunderstand the risk profile due to having convetional rose coloured glasses on.

A conventional field begins with the company searching for the sweetest spot in the field and drills there typically in the exploration/appraisal stage which is then developed as a producer. It makes sense then that the wells that are drilled around and further out have greater risk with declining yields as the field thins out. Not so with shale or coal bed gas fields. These fields are huge some like EFS are up to 400 miles long and are predictable in nature.

There isn't the same risk of water contact in shale or cbm as there is in conventional. Plenty of conventional fields have had final production reduced due to parts of the reserviour being water filled rather than oil/gas.

When looking at oil shale which is booking reserves at 5% of oil in place in my opinion there is far less risk than any conventional play

cheers Icharus