"It's unheard of..."

[CAC]

Roadshow quote:

"It is unheard of, in this business, to be rewarded for undiscovered gas" - MH

Do you think rewarding IOC for undiscovered gas was TOT's idea or Hession's??

I've never heard of getting both the bird in hand and the 2 in the bush.....I'm gobsmacked.

Expect more roadshow reports.

use or flush

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I did not understand Hession's comment on this.  What vested, tangible "reward" did they actually get right now for this undiscovered gas?  My understanding was that they would only be getting money for this undiscovered gas...if and when it is actually discovered.  So if there's no discovery...they get no reward.  And if there is a discovery...they have now pre-agreed to sell the newly "discovered" gas for $100M per tcf.  Isn't that an "unheard of" price (on the low end) for would be, at that time, fully discovered gas? 

If the new discoveries communicate as all the other wells have IOC gets paid $1.29 per mcf. A new discovery that doesn't communicate is yes $100 m per T. Think Hession is stupid? They IOC must think all the new wells will communicate . This deal is only for E/A.

Did someone say Triceratops communicates with E/A or was that a dream . That's a PET ?

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Okay, but how has IOC "been rewarded" as of today?  That is Hession's quote and that is what TREE is touting...but I don't see it. 

If additional gas is discovered, they either get a fair price of $1.29 (if it communicates) or they get a substandard price of $100M per Tcf (if they don't communicate).  Either way it is contingent on a new discovery occurring and the "reward" is a long way off.  So my question remains...what current tangible"reward" is Hession saying IOC received for this undiscovered gas? 

And maybe a better question is...how is this deal for the future discoveries (which provides no cash now and locks us in on those terms) better than just waiting for the discovery and negotiating a fair market price (which clearly wouldn't be $100M per tcf) at that time?