This notion that that csg is sub commercial is completely...

This notion that that csg is sub commercial is completely wrong.

AOE are able to add 2p for under 50c a pj and lets imagine it takes a $100 million to develop a 100pj field giving a spend of a $1.50 per pj to get it to market. This is about AUD 8.50 a barrel equivalent. If they sell that on the wholesale market they make about 100% on their investment. If they put it through Braemar 2 they make about 170%. LNG? they will probably have to settle for 100% in the initial years the way things are looking, but beyond 2015 there is a yawning gap in supply versus projected demand and at the end of the day alot depends on offtake agreements linked to the oil price. Where is oil going in 2013? Won't be under $80bbl imo

No doubt all these articles looking for reasons as to why stocks are falling aren't helping, but we have been in these lulls a few times over the last few years. The concept of massive quantaties if Qatari LNG has been there all along and the notion that csg to lng is uncommercial has been there all along (thanks to Voelte)

YET..

- Kogas stumped up however many million to take a position in BUL not very long ago and all csg stocks perked up
- Santos jumped in and nabbed a blocking stake in ESG..sending up csg stocks
- CNOOC enters into an MOU with BG to take a whopping volume of LNG from its Curtis Island project and csg stocks go up

- When Shell buys into AOE ..same thing

_ When BG outbid and bought PES ...same thing

- Conoco gets in ahead of BG for a jv with ORG...same thing

- BG buys QGC ..

- QGC buys SHG


See a pattern here? Every year to six months something happens and off it all goes again. Are these events about to stop? We've got three to four FID's scheduled for this year.

Bugs me these journo's can't see three feet in front of themselves, have no sense of what history is telling them and also don't appear to have a good understanding of the drivers in the global LNG energy market ..LNG is not about short term supply surplus', its about what the energy picturw will look like in 2020 and how hard it is to get one of these projects in on time and budget- see pluto or png lng.. US 15 billion is the figure for 6.6mt p.a out of PNG and I will bet anything they are going to struggle to getting that built on time in that terrain, in that climate and in that economy.

What will it cost AOE to build 1.5 mt and then 3 mt at fisherman's landing? No way it will cost anywhere near what it is costing WPL and OSH et al per mt of lng. This is why the majors are here. And the stability of setting up shop in Australia versus say Nigeria is not lost of them either.

Granted AOE didn't need to bring up the topic of capital requirement when they did, but equally they have already indicated that they won't be diluting our interests any more than necessary.
Imo we should not ignore the significance of the ex BP guys arrival on the board. NHC are sellers for a price and BP have a strategy to invest in gas and unconventional ones at that, see their global website . I know Shell and BP are old rivals but it didn't stop them co-operating on NWS and may not here. As per above we are due some of this sort of activity and the lower prices right now could bring that forwar.

Anyway..pays to go back over this stuff sometimes to cut through some of crap that gets published