HZN reverse TO of ROC, page-9

The main problem here is conflating the value of prospective acreage with production. Those who have followed the Horizon story in PNG know all too well the gap between these different stages. After major gas strikes at Stanley it took more than 2 frustrating years for Horizon to prove its resources and secure the official licences to go ahead with production at Stanley. The production licence was only signed off on after O'Neal dismissed his obstructive mining minister to get the licence secured. Getting together the finances to enter the construction and export arena was another large challenge. This is why the suggestion that buying Kina Petroleum (KPL) is an alternative to the merger for ROC is absurd. KPL is just another junior explorer wannabe. Yes it has acreage and dreams but not much more and in 5 years time where will it be? You could ask the same about ROC which is also yet to make the transition from explorer/ small producer to a company earning major profits and showing real growth in its share price. Without the merger the future of Horizon is still assured, though on a lesser scale. It will still have a gas train operational by 2016 and another in the wings. Horizon may well buy another junior explorer, Kina in fact is far more attractive to Horizon than to ROC. The point is that the merger has vast benefits for both HZN and ROC and all shareholders will see sp growth in the new company that would not have been achieved without it.