undervalued, page-2

Gurubob,

Yes, if the gas finds a market, undervalued is an understatement.

MEL's enterprise value per Gigajoule on a 3P basis is approximately 4 cents. On a 2P basis it's approximately 25 cents or less. (See BGF Equities Research report in the company's website)

Arrow Energy was taken over at approx 3P 60 cents and 2P 90 cents. Of course Arrow's gas found a path to market via LNG export.

Allowing for all the possible variables, if MEL's gas can find its way to export via LNG Limited's Fisherman's Landing for example, the potential upside is compelling.

Some of the variables are:

Proving up sufficient reserves

Achieving commercial flow rates

Distance to Gladstone LNG projects

Funding etc.

On the positive side:

Potentially large conventional reserves

Dry CSG production reducing costs of water management

Proximity to the East coast and Brisbane