Oil is on its way out., page-9

peekeye you only have to look back at my posts around November '13 to see that I am not an optimist.

There is no doubt that NSW is a very difficult environment to operate within, but I have always believed, and still do, that MEL shareholders have been badly let down by inept management and Board.

The key fundamentals of MEL are amazing, we know we have gas with easy access to the major energy markets in Australia and we operate in NSW which has an immediate shortfall in its gas needs. Yes we are confronted by a NSW Goverment which really has no idea about energy policy and this has been demonstrated numerous times over the last 40 years. And yes there is a vocal opposition to gas development in the Northern Rivers who are happy to drown out rational debate by shouting and engaging in illegal activities. But every survey I have seen shows 10% to 20% as irrationally opposed to gas development, about the same number on the other end of the spectrum with 60% to 70% with no fixed ideas. MEL has just not captured the middle ground. I am not disputing that it is very hard work but I also believe that the recent MEL management and Board just do not have the capability to engage in the necessary debate. You have to remember that the changes to MEL management heavily skewed us to Esso/EXXON experience. And even now in more than 50 years in Australia, Esso has never managed a successful development outside of Bass Strait. Non has any ex Esso person ever lead a junior to achieve success. I just don't believe that Esso experience delivers the necessary skills to run and develop a junior.

As for funds, unless MEL has made another cock up, we should be successful in the court case. We should be able to use that win to negotiate a path forward with the NSW Government. A successful outcome there would be an immediate platform for rerating which should allow MEL to raise more funds.

We need to remember that the shortage of gas both in the immediate Northern Rivers and in NSW generally gives us a market that is insulated to a large degree from world oil prices. For evidence of this just look at the prices locals pay for gas that I posted earlier.

So optimist - not really but we should be doing lots better.