Ann: ORIGIN ENERGY LIMITED PEL 514 GAS FARM-OUT , page-19

re: Ann: ORIGIN ENERGY LIMITED PEL 514 GAS FA... Are you guys saying that PGS could give a 10% share of PEL514 to Origin and be free carry? That could be only for the deep section I hope.

IMO, that 10% wouldn't leave much value in PEL514 for PGS.

It is clear that PGS will have to pay $8m for Stage-1 and $8m for Stage-2 (I don't know why this wasn't clearly stated in PGS's anns! May I be wrong, I don't know!) That will be very risky as there no proven resources in the Patchawarra Trough despite it's promising.

Btw, has anyone contacted the management for asking these issues?

This company hasn't got those cash resources to pay for 20% of work program expenses which is nearly triple amount of its market cap. This deal has no value for PGS, even negative value because of its exploration risk which PGS wouldn't be able to afford IMO.

If PGS was a company with $40m-$50m market cap $8m wouldn't be a problem in these conditions, and I wouldn't be bothered with that amount of money. It could make a cap raising and get the money. But I don't think it's possible

Why I am writing here is this; I was looking to buy in PGS if they could be free carry, but they are not! I am not a shareholder but I am frustrated with this deal. I feel I missed an opportunity.

I couldn't understand why they could be free carry in this Senex-Origin JV deal!

They should have forced Origin to accept PGS's free carry condition before accepting the deal. If PGS wouldn't accept the deal, Origin would not be able to farmin in deed. (we also don't know the details of the agreement made between Senex & PGS). Then why they have accepted these terms, I really don't understand!