stage 1

The following example will hopefully explain why I like the project so much

Commitment over first 2 years
12.5 in initial payment
70m carry

Production - assume profit if 25 in year 1 as suggested by ROC
Year 2 assume profit of 35 million reflecting increase production for first 12 months of development drilling .
What do ROC get back
They get back through cost oil the 85 m plus arguably another 60 m in NPAT
What they also get is a project that if going well and requiring a big redevelopment will be farm down at an far greater level than what Roc paid as they would have derisked it significantly through phase one activity
So in essence ROC is being paid to take a project they are key beneficiaries forward . Impact on Rocs cash balance will be minimal in year one and is by my calls likely to be Cashflow neutral to slightly positive

This is probably one of the best JV farm ins I have seen and is clearly a vote of confidence by Petronas of Roc appraisal and development skills