wcl t/o metrics, page-7

thanks hendrous - yep after your post I went and found that webcast, and had a listen.

He does say that the delay was due to the "change in Congress" of the Chinese govt.

He is confident that the Petro will complete sale by 23 Oct because MPO is already hiring staff on behalf of Petro, and locating office space on behalf of Petro.
He says, so that says all seems confident signals that sale will be completed.

But I guess the issue for me is that of Timing.

Petro/LNG still need to confirm gas supply to Glad Ports by 31 Dec 2012.

LNG has to secure gas supply in order to execute a FID. The FID is needed before they can recommence the development of the F/L project.

They have previously said that they want and expect the F/L project to be in production by 2015, but somewhere I read this was pushed back.

Petro has an agreement with LNG to supply Petros share of MPO gas to F/L under a Tolling Agreement.

So Timing:

"The Company’s Agreement for Lease with the Gladstone Ports Corporation Limited was extended to 31 December 2012. Subject to concluding gas supply arrangements and other project requirements, the Company will have a further six months to progress to a final investment decision."

"Based on the FEED, and other work, undertaken by HQC to date, the construction schedule remains unchanged at 30
months from FID to first LNG production"

Thus it seems:
Confirmation of Gas Supply by 31 Dec 2012
FID by 30 June 2013
First LNG Prod'n by Dec 2015

I will bet they have a shorter time frame than that.
They seem to have done such a lot of work in China re EPC and design etc. With the plant to be constructed in modular form in China, I bet they will have it constructed pretty quickly.

So its Oct now.
I cannot see how they can, in 10 weeks, have enough proof ) personnel, technical data, reserves, production profiles etc, to be able to prove to the Glad Ports Authority, that they have the Gas Supply, and that based on that evidence, the Glad Ports should extend the LNG lease ?!

How do they do it? i simply don't know.
Maybe a Guarantee from petro to Glad Ports maybe?
maybe gas from C/Basin?

The Tolling Agreement I guess is part of that "proof".ie 65tj/d supplied by Petro from MPO dirt.
Does the Glad ports look further into the Gas Supply "proof" ie not just accept a letter - do they say "show us"?? got no idea about that.

So the other 65tj/d is pegged to come from WCL - and WCL has the demonstrated expertise to extract the gas.
I really think they need WCL to underpin their whole gas supply plans.

the other thing is re the "sleeper" - Mitsui.
They are another central pivot.
Petro supply plans hinge on getting all the gas produced from MPO permits and all the gas from Meridian.
Mitsui has 33% of MPO permits, and 49% of Meridian.
Mitsui also has the Export marketing rights to the Meridian gas.

So if Petro/LNG does not buy WCL, and therefore no certainty that the Meridian gas will go to F/L, then why would Mitsui agree to send its share of MPO gas to F/L without a plan for its share of Meridian gas?

it seems to me, that any plans for Mitsui's share of potential gas production from the MPO fields, would be contingent upon what plans are in place for their share of meridian production. There are surely huge economies in developing and marketing the MPO gas and the Meridian/Paranui gas jointly.