some thoughts on agm

I thought a a few points from the AGM would be useful.

1.PA was very upbeat and positive generally.This project is a company maker. We do not need the coal or gold etc.

2.As you will see from the Seismic profile and also the Wireline logging graphs the gas they have found will not require fraccing to flow.This is a huge positive.The gas has migrated up from the coals which lie beneath the gas pay zones residing in the sands.

This find is consistent with that found by SEH in their Linxing drilling. About half of their wells required fraccing and half did not. also note Phillips have a Coal Bed Methane trial plant in the area.

3. The excellent post of Kiltare spoke of flow rates.I also believe from the AGM that a flow rate of as little as 200 will be sufficient to be commercial. SEH has had flow rates of between 125 to 800 mscf/d on non fracced wells and up to 2000 on fracced wells.

4.Unlike SEH lrl has a small no of shares at 250m and will not need to raise money.no dilution of capital.That is one major advantage of having the MD/Directors with 15% of the issued stock.

5. PetroChina is the best JV partner Lrl could have. they are already providing the drilling expertise and have 400 rigs available. they also will enable a smooth transition to Chinese Reserve report (CRR)and then the ODP.

6.An extremely strong and supportive top 20.In IDG and WH Ireland you have groups who can,if Co required assist on capital issues.

7. The stock has now come to the attention of brokers both in UK and now Australia.It has little Enterprise value and if the well flows at a commercial rate then a further rerating will occur.This is where SEH helps as a lot of the hard work has been done to prove up.Remember the LRL area is smack in between the two main SEH areas.

The drill bit always has to do the work but lrl is poised to move to the next level.