Ann: Monthly Drilling Report - February 2015, page-60

BG's stake in DLS's ATP940 permit was a farmout, unlike CVX_Beach or ORG_Senex where big dollars were committed for stage-1/2 of drilling etc. It's entirely upto Beach what they want to do with their 21mil in DLS.

QGC actually subscribed to 31.622 mil shares in DLS for 62c for $19.6mil back in Feb2012. Their current holding is 36.216 mil.

So with 4 wells drilled in ATP940P, DLS r yet to bank a contingent resource which will most likely come after flowrates r in from these wells.

I don't think RDS would b fussed about this resource, as the gas from their Arrow-BOW deals is far more then enough to either cater to a 3rd train of 4.25 mtpa at QCLNG or flagged off for 3rd party sale to GLNG.

The combined QCLNG_Arrow 2P reserves in QLD will easily exceed 17000 PJ. There was enough gas for 2 x 4.25 mtpa trains, so possibly a 3rd train will come into the frame in 3-4 yrs time.

What this BG acq does for Shell is provide them with a second cashflow asset, outside the NW Shelf.

They already cashed out of Browse (sold to CVX) & Wheatstone (sold to KUFPEC).

Prelude development drilling is still going gang-busters, b4 the FLNG ship arrives.

Then u have APLNG (Conoco-ORG) who have 2P reserves (14091 PJe) sufficient to cater to 2 x 4.5 mtpa trains, compared to what GLNG needs for its 2 x 3.9 mtpa trains.

So IMO, BG's interest in ATP940 could b flogged off to 7group at a decent premium (& assuming Beach do the same). Beach & QGC's stake in DLS reminds me of the likes of NewHope who held shares in Arrow & Westside & cashed in when an M&A offer came along. NHC's oil & gas bizness in QLD is called Bridgeport which holds some scrappy permits, with nothing major.

Sorry abt this post that spans across 4 boards.