value of artemis for mog? $97 per share?, page-32

Hi ACN,

I was just browsing the MOG Blog to see what was happening with the posts re Artemis and noticed the $97 per share thread.

The way it works in the Gas Industry is this:

1. Prices are worked on a Gigaloule (Gj) basis

2. 1 gigajoule (Gj) is close enough to 1000 standard cubic feet of Gas derived from the North West Shelf producers.

Assuming MEO strike the payload.. 12TCF recoverable gas then you can apply the following to EGOs' 10% share .

A. 12Tcf x 10% = 1.2Tcf

B. 1.2TCF = 1.2Billion Gj

C. 1.2 Bill Gj x $1 = $1.2Bill netback income to MOG

$1 being an approximate netback figure on current NWS overseas supply contracts as estimated by the Domgas Alliance in WA.

Quoting from an earlier report on the industry by Domgas:

"Recent LNG export shipments by the North West Shelf Joint Venture appear to be at prices ? let alone ?LNG netback? prices - that are well below the domestic gas prices currently being sought by major gas producers.

The price of LNG supplied by WA to international customers is currently less than $8 per GJ delivered.

This equates to a netback price of less than $3 per
GJ.

The price of LNG supplied under the 2002 North West Shelf gas contract with China has been estimated at around US$ 2.97 per GJ, or less than A$1.00 per GJ netback."

source : www.domgas.com.au

So based on this number you now apply the number of shares on issue to the $1.2 Bill and you have:

D. $1.2 Bill divided by 288 mill shares = $5 per share approx.

Hence ,SP on success would have a forward cash backing of

$5 ..yes, only $5 from a 20c share today .

This is all based on the fact that the 12Tcf is proven beyond doubt and that will take a few drill holes to firm up the reserve..a few months away.

However ....

You/We will all know more about the initial success by this week. A report of significant hydrocarbons intercepted at the A1 well will give all holders a fantastic Xmas present ...most likely for MOG ,the SP will fly past its previous highs and then come off a bit until A2 is drilled.

If after A3 the 12 Tcf is proven (later in 2011) beyond doubt,then you know what the SP should like.

Now that would be a brilliant result from 20c today...wouldn't it!

Now, if nothing other than a big blast of CO2 comes out of A1 then you would need to run for the hills,just make sure one of your fingers is ready to press the sell button before you run.

MOG is the most suited out of all the WA360P partners to have the largest percentage return for holders in the shortest timeframe given the number of shares on issue and the fact that it has massive volatility on news without the major BOT problem infesting MEO..for the moment that is.

Beware the BOTs ... time to get out once they hit and watch from the sidelines.

But hey! this is strictly my view and take on MOG at the moment. No need to agree...just check the right source material and make your own investment decisions.

Tomorrows pre open action might give you a pointer as to what has happened with the drilling over the weekend.Might even buy some myself if the signals are good.

Best of Luck and Merry Xmas

Cheers

HR

No advice given or intended..simply my views above ..it's your money ,not mine...DYOR/DD