STO Investor Briefing, page-49

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XI11

67 Posts.

11/11/17

18:00

Post #: 28704932
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Originally posted by Value_Hunter ↑

XI11,

the different parts of STO have different opex numbers!

the stated "8-8.50" boe - doesn't incld
plant opex - circa 90-100
pipeline tarrifs
a few tolls
onerous contracts (30)

most of those apply to glng..........

the other thing you aren't incld is the fwd capex for development of gas in the CB (which is why I have mentioned "tight".......) - when you chk the reserves, and the glng contract - you will note abt 50% + is developed, which means the other 40-45% is not developed .........the recent improvement in opex in the CB - is likely to mean additional resources will get reinstated to reserves........

also NBB - the inc in capex for glng - which is basically development drilling to
1. replace decline
2. add new reserves......
3. whatever you believe the capex is for Narrabri (my no's come from the IER in the takeover doco)....

finally - some of the 3rd party supply to glng - the margin is "modest" ...... and the 70mm boe - is more like 59-62 - until narabri gets approved...

when STO was $3.50 and ORG was $4.50 +/- - the margin of safety was better in ORG (imho) ......it had the ability to "survive" even if OP's stayed flat around 45/bbl ........it also had (pre lattice sale) - almost identical LNG prod profile to STO .......and auguably - its lng project is better , b/c it has the ability to fill the plant.......ORG has had less dilution than STO......I would agree 100% that STO has other growth projects (png expansion etc)......

I own quite a few oil stocks - that do not pay a divvy ......

I do understand the attraction re OP leverage inherent with STO........

rgds
V_H

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Thanks mate - that is helpful indeed.

So fundamanetally when Santos forecasts 35 - 40 FCF breakeven at a portfolio level what is the best way investors should think of, and apply that guidance to performance and valuation?

STO Price at posting: $4.49 Sentiment: Buy Disclosure: Held
1 Upvote

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STO Investor Briefing, page-49

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STO Investor Briefing, page-49

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