Ann: Drillsearch Energy Reports FY2015 Full-Year Results, page-15

Also if you compare the DLS and BPT share prices over the last 3 years BPT has traded with about a 20-30% premium for a lot of that time so now that the gap has been cleverly closed a merger in which DLS holders get 1.3 BPT shares for every 1.0 DLS share would just restore the longer run status quo (25% to 30% is not really a hostile premium, it is a hostile joke). I presume in a Beach take-over of DLS (which I doubt is an option) Seven would not be able to vote its stake, whereas that may not apply in a merger. Anyone recall how the law works in these two cases? I don't know anything about Beach. Are there any opinions on how good a merged company would be to hold? Personally its hard enough for me to get my head properly around the DLS business. It just seems to be very difficult to value these growth plays when the growth prospects all but disappears (don't bite my head off either, it's true. In a sustained low oil price environment DLS will never pay a dividend and if it doesn't grow its share value what else is there left for an investor to be interested in).

Not that I think the oil price will stay unsustainably low for long, although it may not rise to its previous heights again unless we see major conflicts a large oil producing nation or the shale oil revolution just proves to be an unsustainable industry built off the back of an engineered central bank experiment gone horribly wrong. I'm pretty sure a new norm will emerge for the oil price which will keep DLS profitable but not necessarily drive the growth model as fast as it did in the last few years.

In the balance of all probabilities you'd have to think we might not be too far away from a pile in call on DLS. The US will need to put a floor under the oil price to preserve its industry and markets. I've got a gut feeling the $40 buck mark for WTI must be pretty close to an important line in the sand. If DLS's costs are A$31 (~US$22) and we are running some pretty capital efficient conventional plays, what would the cost of the average US junk bond bubble subsidised shale producer be when you factor in a real risk weighted non-zero interest rate? Probably somewhere between US$22 and US$40 so if they don't want to be running their companies as charities, plus US$40 oil would be needed. Cue the US propaganda machine, the banksters, and the US futures market manipulators. They'll figure out a way to spin the market, change the narrative or even create a crisis if need be to dial up (optimise) the oil price they need to keep their junk bond markets afloat as long as they can.

Just wish that the whole Beach/Stokes thing would go away so we could be left to trade and/or hold DLS shares in piece without the interference of these merchant banks which bleed the system dry.

Eshmun