why interested in meo?, page-3

Thanks, shrewd crude's claim that 5c cash backing is the value of this explorer as it is about to get another farm-in for NWS permit areas is silly, but don't agree that he is a clown.

Explorers will provide his best return if they suddenly meet his investment criteria - resource confirmation and production - provided they haven't got away earlier.

He wants to share the reward without sharing the risk of the exploration phase. Eliminating risk and maximising reward is not stupid but can't be entirely achieved.

The risk of losing money is substituted by the risk of not being on board a company when it finds another giant NWS gas field.

So, he doesn't care if they fold, having been too shrewd to invest yet. What he really does care about is that they don't get away by rising in price too much before they meet his investment criteria.

Successful investment in explorers acts against his potential later interests so he suggests focussing on the tremendous risk, oh, the terrible risks.

It is not only shrewd crude who understands that low success rate makes exploration risky. The longevity of MEO has been achieved by farming in the venture cash.

MEO is a vehicle capable of and having the permits to do real exploration in a massively rich area. So, they earlier drilled a dud where the result was not hydrocarbons - gas and condensate, but water - so what?

Any idea how many of these were drilled in the NWS before the currently-producing monsters were found?

The SP fell then - of course it did, it rose in anticipation, just as it is beginning to do now, because the nature of risk/reward equation is the same every time they can afford (through farm-in) to do more data gathering and drilling.

The coming farm-in will mean more data and more holes.

Didn't CDU go to $10 in a day or so, when it announced a huge copper find - a little prematurely, as it turned out.

If MEO finds another dirty big gas field out in the NWS shelf area, you will need to be awfully agile to get any of the initial massive response. That is one of the exciting aspects of exploration investments - if you like "excitement" with your investments.