trading at cash-$0 for $15m production,drill

Petsec,once again, is trading at its cash in bank now that currency has fallen 13%.Petsecs assets today include

1 Cash- $26 US- AU $29m (12c)
2 Us producing assets at PV10 valued at US$ 32m- AU $35m (15c)

Revenue on course for around US $15m or AU$17m.

This will be re valued up in January after Marathon reserves increase from 120BCF to 200 Bcf (psas conservative view) or even to 300Bcf (psa's partners view). This will increase reserves to approx 15Bcf for psa including Mp270 etc-after depletion.It is clear also that Main Pass 270-3 is only a guess. They have not been able to tell where it finishes hence it was explained that reserves on this have been conservative.

IT IS A GIVEN RESERVES WILL INCREASE EVEN AFTER 2013 PROD.

Value will increase to minimum US $40m-18c.

3. Shale- Alberta-?$0 or if they can unlock 10mb oil.My guess on this is that it will require more finessing and Psa will sell down some of their interest for good capital management. value 0 to 40c

4. Shale- Fort Worth Texas- awaiting jv partner..oil play

5.New drilling conventional.

a. Hummer-early 2014.A large Main Pass play. Target 183Bcf and 4mMbc.They are very excited about this prospect.
b. Ship shoal 36-also 2014. 121bcf +3.7 MMbc.Another realisitc prospect.

c. Also a chance of conventional drilling in 4th 1/4 2013 but they would not disclose the are on this.


US Economy-the place to be.

Usually this time of year the NG price is tanking but has held surprisingly well.The main reason is the general turnaround in the US economy which has been reflected in industrial production numbers. The power stations have also maintained their dependence on NG rather than switch back to coal. The latest study shows that less than $5 this will remain the case.Own Ng not coal.

Psa are in the right region for demand ongoing. It appears to be the one economy that is looking healthy and competative.

Overall Psa is a very conservative play with trade at cash . Nothing in price for 14-15Bcf of reserves and production of around $15-$17m for 2013.0 in price.

0 in price for large prospects to come in 2013 late and early 2014.

Eventually this boat will float on its own earnings and success..patience still needed for a while.its frustrating but we will be rewarded and its great buying at these levels.