Ann: Company update and diversification strategy, page-20

Hi Jimmy,

Question: is your investment thesis here that the oil market is cyclical and will come back at some stage or that they will apply the technology to new markets? Management seem to be focusing on the latter.

I'm not a commodities expert so maybe oil will mean revert over time however in my mind there is a big risk that it doesn't (that shale technology advances has changed the oil game and caps the oil price structurally for the next 10 -20 years). The geopolitics certainly looks like there is going to be instability in the middle east shortly and I think the recent run up in the SP is likely to be investors pre-empting that this will push the oil price higher.

But I would personally prefer to invest if the company did actually start to get penetration (sales) into new products outside the oil market. I just dont know how to quantify their successes in doing this at this stage so view this as somewhat speculative.