Gazonor's feasability study is nearly completed. Once a decision about the way forward is made it will change sentiment.
Remember that EPG had to outbid other tenders for the purchase of gazonor which meant that the pricing had to take into account some of the value of undeveloped resources hence the financial burden is high at the moment.
The half yearly report did not explain as much as it could but the reduction in operation costs will place Gazonor on a stronger footing. The reduction not only comes from the increase in gas sale capacity which started in December so only one month of sales data at this higher capacity has been realeased but is also a result of the long awaited ending of management contracts. EPG is now operating gazonor by itself and this will lead to improvements.
I suspect the study has been this long in completion due to EPG waiting on the French government to give possible access to monitoring holes. Thought nothing of it when originally told at the AGM but it makes sense that if a monitoring hole was situated close to electrical infrastructure such as a pricing node then it may be more economical to place the generation equipment at a new site. This would indeed slow down the whole progress.
It appears that someone read the half yearly report and didn't like it. The funny thing is that there is nothing in it that hasn't been reported in the quarterlies.
cheers Icharus
EPG Price at posting:
17.5¢ Sentiment: LT Buy Disclosure: Held
