Ann: Arrow Recommends Acquisition By Shell / Petr, page-16

re: Ann: AOE: Arrow Recommends Acquisition By... Short term implications for BOW sp

1) Money from AOE recirculating. Some but I am not sure there will be much.
2) Shell/AOE putting a pretty low figure on 2P,3P and on the prospective resources.

Longer term, it leaves pretty much the whole of Qld's Surat & Bowen resources tied up by big companies who will no doubt play the same LNG parity domgas game as in WA (where there is also vast undeveloped gas).

I'd say therefore that longer term (say 2 to 5 years) BOWs gas is going to be very valuable domestically, even if it doesn't get access to LNG export. WA gas pricing history to the analogous game to consider.

STO,ORG,BG,Shell they're all taking a long view, all will be looking for closer to LNG parity, just as in the West. All are and are with partners who are inclined towards hoarding the gas rather than giving it away. All trying to build uncommitted reserves for their LNG plans. BOW should have a very good domgas market imho.

The next BOW dip won't imo be below $1, but it just might be worth adding on regardless.

EL

EL