New presentation P16 is the same as the merger presentation P11,...

New presentation P16 is the same as the merger presentation P11, except now they add note 2, which states the 70.5 BOE PNG reserves are subject to the 22.5% reduction to account for the state nominee participation, now the 70.5 million BOE 2C PNG contingent reserve is actually 54.6 million BOE. The combined 2P+2C resources of the new company are 141.7 MMBOE and not 157mmBOE

So to current 2P Reserve Roc bring 20.9 MMBOE, HZN bring 16 MMBOE....the 2P + 2C, Roc bring in 69.7 MMBOE, HZN bring in 71.6 MMBOE. As for cash, Roc bring in $88 million + $ 67 from Balai repayment, HZN OSAKA cash $77 million + $134 million cover the $200 million debt, leaving $34-$40 million cash.

Post PNG nominee participation both bring in almost exactly the same hydrocarbons in BOE terms. I will admit there is one attraction in the PNG assets which is outstanding, ( excluding exploration potential) and that is, once up and running, the gas and condensate production will not decline for an indefinite period, so the merged company will have a significant proportion of it's production underpinned for a prolonged period. Regardless,even if the PSC regime in PNG is much more generous than China or Malaysia, I can't see that the price of gas in PNG will be anywhere near enough to make up the gap.

The problem here is that we are TOLD the merger will be good for ROC holders, that it is value accretive etc but they DO NOT SHOW how this is the case. There are no numbers that they give us to explain how ROC shareholders gain value, so basically we are left with our own back of the envelope calculations ....and until proven otherwise, they show me that HZN assets coming to the table are not enough to make up for the 137% dilution.

If Roc wants PNG exposure in an asset portfolio similar in nature , I suggest they make a bid for KINA petroleum (KPL), smaller scale ( 15% KETU, TINGA etc but without Stanley) offer a 30% premium to current price and pay $130 million cash. Roughly, they take on some debt, they end up with about 40% of the 2C reserves and future production, NO share dilution, plus some interesting exploration assets .

Sorry Alan, I'm still not convinced.

Cheers

Dan