Comet Ridge

Townsville Bulletin - - Investor -

Garry O’Neill Wil­son HTM Comet Ridge has five prin­ci­pal as­sets: ( 1) Bowen Basin Coal Seam Gas ( CSG) in Joint Ven­ture ( JV) with Santos & APLNG ( ATP337P Mahalo pro­ject); ( 2) Galilee

Basin CSG ( ATP743P and ATP744P), with po­ten­tial for mid to long term min­ing power de­mand and LNG sup­ply; ( 3) Gunnedah Basin CSG in JV with ESG ( PEL427 and PEL428), likely to sup­ply NSW power de­mand in the medium to longer term, with up­side po­ten­tial to feed pro­posed NSW LNG projects; ( 4) New Zealand CSG; and ( 5) a 17.3 per cent in­ter­est in small scale US oil pro­duc­tion, which we ex­pect will be di­vested to pro­vide fund­ing for CSG ex­plo­ration and ap­praisal.

Comet has re­ceived in­de­pen­dent ini­tial 2C and 3C con­tin­gent re­source es­ti­mates for its Bowen, Galilee and Gunnedah Basin projects, to­talling 288 and 2543 Peta Joules ( PJ) net to Comet re­spec­tively, and to­tal re­cov­er­able gas ( i. e. in­clud­ing gas ex­pected to be iden­ti­fied through ex­plo­ration) in ex­cess of 4,000 PJ.

We re­tain our Buy rec­om­men­da­tion and price tar­get of $ 0.46 / share. We be­lieve Comet is un­der­val­ued, with its Bowen Basin CSG joint ven­ture with Santos & APLNG ( the Mahalo pro­ject) likely to be ac­quired to sup­ply CSG to the Glad­stone LNG projects, and its Gunnedah Basin in­ter­ests with ESG and wholly owned Galilee Basin projects well placed to sup­ply emerg­ing mine power de­mand and NSW power re­quire­ments re­spec­tively in the medium term.

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