Which offshore Bass Strait leases are BHP and XOM "sitting on" please?
It is quiet an old production province, historically lots of CO2 with the hydrocarbons (which makes it difficult to process), the newer fields have even higher levels of CO2 (about AUD1b was spent over the last few years to build an additional processing plant to deal with the higher levels of CO2). As such, it is an area in firm production decline.
As a person with some expertise in the drilling of oil and gas wells, both in Australia and around the word, I would also like to advise that the geology of Bass Strait is actually extraordinarily difficult to drill, which, when coupled with its tendency to have the hydrocarbons contained in increasingly small "pockets" (thus making investment payback more problematic).
Most, if not all, the "easy" production is long gone.
All of which highlights why LKO represents such a terrific opportunity, should they be allowed to drill and produce.
Finally, XOM is in a similar situation having acquired on shore leases (I seem to recall they spent in the range of AUD200m for them) very similar to those held by LKO, both geographically and geologically. In effect, they are also hamstrung in a very similar way to LKO.
My 2 cents, YMMV, DYOR etc etc
LKO Price at posting:
0.3¢ Sentiment: Hold Disclosure: Held
(20min delay)
