Just picking apart this report and previous annual report. From...

Just picking apart this report and previous annual report.

From the Annual Report

Our high quality Eagle Ford acreage produces strong recoveries at reasonable costs and thus generates good returns, even in a low price environment. Because of these characteristics, the majority of our forward capital is expected to be invested generating strong growth and shareholder returns in the Eagle Ford.

With mixed appraisal results in the Woodford, Sundance’s Mississippian/Woodford position generally requires higher prices to meet our hurdle rates. Because of the mixed Woodford results, higher overall unit costs, and depressed pricing at year end, we recognized an impairment charge of ~$60 million on these assets at year 2014. Had prices maintained their strength, we likely would have been in a position to recover our investment from these assets.


So in today's release the impairment charge shouldn't be a shock, as $60mil was taken up in the previous full year result. Today they revealed impairment expense of $16.0 million.

As stated "Mississippian/Woodford position generally requires higher prices", hence the write down was necessary due to current POO.

"Eagle Ford acreage produces strong recoveries at reasonable costs and thus generates good returns, even in a low price environment". Hence they didn't see the need to levy an impairment charge based on current POO.

Now for AZZ's stellar offer of;

- Northern Star gross pretax sale proceeds 148,788,560 USD – cash payment only
- Big Star gross pretax sale proceeds 105,069,420 USD – cash payment only

Nth Star = 13,000 net acres (USD$11,445 per net acre)
Big Star = 8,000 net acres (USD$13,134 per net acre)

Rough maths USD$12,000 per net acre.

Based on that offer, Eagle Ford 38,000 net acres x $12,000 = USD$456 mil or AUD$650mil.

What the hell am I missing?