Yes, I like a civilised discussion of whatever subject. Bagging people with opposing or different views is schoolyard-bully stuff, and annoying because it interferes with getting responses to the substance of observations and comments you make - for or against. If there weren't opposing views, who would sell us our shares?
It helps me assess if what I am thinking makes sense by writing it down in the first place and then being stimulated to discuss it more - maybe argue about it. I often change my mind when someone tells me something I didn't know or didn't consider properly and it helps validate my reasoning when they don't. Other times, like now, I can entertain and accept another valid point of view quite happily while maintaining a different position.
KAR story is an object lesson in what happens when a company gets a sniff of gas in offshore drillling because their target is 6 trillion cubic feet of gas. Up 42% to $5.40 today is nice isn't it? (Needless to say I don't own any)
The MEO target is 6-9 trillion cubic feet of gas also (critically) offshore, in an area where there are fields that size and bigger - so it contains the seed of the same sort of potential, give or take a few trillion cubic feet of gas.
A quick look at KAR sees (aside from being further advanced and getting sniffs of actual gas) they raised capital through issuing shares for their exploration, rather than farm-in.
I liked seeing the similarities in run-up, good modern tools with 3D seismic surveys indicating this and that, to justify following it up by drilling. I haven't looked closely enough to compare what KAR said about their pre-drill results - maybe they had reason to be more confident in the first place, but certainly at this stage it is way further along the cycle.
Anyway, it nonetheless highlights quite well exactly what sort of value proposition can develop in exploration for massive gas fields - when conducted offshore.
I haven't even attempted to interpret what MEO has said so far about its current exploration data, presumably it will be revealing the full array of its data to the farm-in partner, not to us.
Mind you, short of "we found gas", it is going to be of limited value to me anyway - I'm not a petroleum engineer. The fact it has the rights to explore, and has been doing so, in the right district, and will do more of the same in the not-too-distant future is sufficiently attractive for me at this stage.
I liked what they said in their response to the ASX speeding ticket today. They say it may be because they announced their "preliminary volumetric estimates" of "6TCF to 9TCF" (gotta love that "T" - you don't see that onshore), which is based on "significant technical work undertaken during the quarter" and they were about to launch a farm-in (well, they say farm-out) process at the Seapex Conference, which concluded on 23 April.
It traded another 20m today and closed up modestly on yesterday's 9.9 cents to close at 10.5 cents after a few little sniffs at 12 cents today, much the same as it sniffed at 10.5 on Friday, so it is still travelling alright.
More than the SP for the next few days, the next announcement concerning who farms-in and for how much is what has my full attention. If this happens reasonably soon say, in the next couple of weeks, I would choose to interpret that as a very good sign concerning what their current data is saying to prospective farm-in parties, although there is nothing in particular to support that opinion.
If gas is there, and not just all around it, it will be large and modern processes should be capable of locating it with a much higher degree of certainty than was ever the case in the past. It also seems a reasonable inference to draw that this also suggests that good preliminary data is better value than ever before.
It is worth bearing in mind that early exploration in the NWS concluded that the first gas find in 1971 was "uneconomic".
If you have a general Google, or look at the Goescience or one of the Schools of Petroleum Studies /Engineeering websites you can marvel at the size of what has been found and developed since then. Around 42TCF at Gorgon and 30TCF at NWS Project for a start.
cheers
MEO Price at posting:
10.5¢ Sentiment: Buy Disclosure: Held
