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$3.10 senex energy limited

Ann: PGS: Sale of Interests in Cooper Basin, page-8

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rollacoaster

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06/09/18

19:54

Post #: 35454359
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Originally posted by rollacoaster ↑

Good move by Senex.

Takes advantage of PGS's financial situation and picks up the remaining 20% of the title and the titles themselves (PGS held them I believe), so this secures title fo bugger all spend.

Note that Senex farmed out roughly 80-90% of the deeps sections of these tenements for something like a $50m+ free carry to Origin a few years ago
So the tenements are highly prospective. I think the free carry was up to $80-$100m. Senex just paid $400k for 20% of the deeps AND the shallows.

I suspect that Senex will farm down the Deeps again for the best free carry it can in the next two or three years and this 20% from PGS makes the farm down easier and still allows Senex to retain a reasonable working interest. Not sure about the shallows but Senex may be more keen to explore these themselves as they specialise in this - certainly a good thing to have for the medium term

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The short version of my original post:

Senex paid $400k for 20% ($20k per 1%) from a distressed seller for what Origin paid roughly $80m for 80% ($1m per 1%) in the peak of the cycle.

And the kicker is Origin paid that price for the Deeps section (ie only the unconventional gas depths). Just got to find another sucker in the next peak.

SXY Price at posting: 46.0¢ Sentiment: Buy Disclosure: Held
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