Billt5,To some extent I agree with your views, and if things get...

Billt5,

To some extent I agree with your views, and if things get worse in Europe, who knows where the markets might end. As for MPO’s SP, it has continued to slide since talks began regarding the RST. What concerns me is the uncertainty and lack of understanding. Lets hope today’s announcement regarding RST within the coal seam gas sector will clarify and set things straight. BTW your re-tracement target of 75c seems quite low, although not impossible. My support sits at around 95c with a quick recovery.

From today’s Petroleum News - Wednesday, 30 June 2010

EXPECTATIONS are rife that the federal government may be close to a deal with Australia’s burgeoning coal seam gas sector on a resources super tax compromise.

According to the Australian Financial Review, Prime Minister Julia Gillard could announce a deal to allow CSG projects to be taxed under an adapted version of the petroleum resource rent tax (PRRT) as early as today.

The PRRT, which has governed Australia’s offshore oil and gas projects since the 1980s, carries the same 40% tax rate as the proposed RSPT, but has concessions including a reduction on the impact of the tax on existing projects, an increase in the level where the tax would apply and an immediate write-off on new capital expenditure.

Macquarie Research analyst Adrian Wood told the paper a PRRT for the CSG sector made “complete sense” as it was well understood not just by oil and gas companies but also by existing and potential customers.

“It’s definitely a workable compromise,” Wood said. “Buyers understand and know the PRRT; it’s an established regime so you don’t have to wait for the dust to settle and iron out the details.”

Meanwhile the Australian reported Woodside’s North West Shelf gas venture would be included in the CSG deal.

The NWS is not subject to the PRRT and currently works under a 12.5% royalty regime and 30% excise tax.

The news of a deal comes as Gillard races against the clock to reach an agreement with the resources industry on the RSPT before miners restart a punishing advertising campaign on Friday.