Personal opinion

[Libtardius Maximus]

given the news today with a report back date to PNG PM by EOM, the SD with a major happens before the end of this month. This makes PNG's price a direct comparision to the chosen partner. I don't buy that management doesn't know who the partner will be. I'll bet there's a scramble going on by bidders as I type this.

Using PRE as a baseline is apples to oranges since it's T2 V E/A. IOC will use E/A partner numbers for PNG additional %.

Tick tick tick shorty.

[TxPm]

That logic makes sense Lib. If that is the case then we could see some huge price movement very soon. Oh what will the shorts do??

[trans]

What if a big house comes out with a strong buy rec, now that final approval looms. That a fairly strong possibility, cause it has been noticeably de-risked? Have the shorts forgot about that? btw, imo lots of short covering today..

[Thylacine-2]

PNG may be cooperative in setting the "market price" for their buyin.  But I'm puzzled as to why they tied the cancellation of the termination notice (presently only suspended) to successful negotiations of the 50/50 arrangement.  It would have been a friendly gesture to have withdrawn the termination notice unconditionally.

[johnwgrant]

given the news today with a report back date to PNG PM by EOM, the SD with a major happens before the end of this month. This makes PNG's price a direct comparision to the chosen partner. I don't buy that management doesn't know who the partner will be. I'll bet there's a scramble going on by bidders as I type this.

Using PRE as a baseline is apples to oranges since it's T2 V E/A. IOC will use E/A partner numbers for PNG additional %.

Tick tick tick shorty.

Hmmm...   I like your thinking - but, my guess is that we will be happy to have the "official" negotiated deal with the PNG gov't concluded by 11/30/12.  Then they will have to get the NEC to give it the "Final Final" approval (add one more week into December).   Then (and only then) will the IOC team be able to try to pin down the top 2 or 3 bidders and (sigh) FINALLY announce the deal.    My hope would be an early Christmas present 12/21/12 - but, it would not surprise me if we had to wait for the first week of January 2013.   I am hopeful that we get some Antelope 3 well updates in December that will help focus some investor attention our way.   I am very surprised that our stock price is below $65/share with all the good news announced (and deals coming SOON...).

[Tree]

Hey Lib, Your post induces me to post a theory I've been hatching.  EWC was initially IOC's prefered LNG producer as the terms were unprecedented.  1.5 yrs. ago Phil said 'the world now knows what our deal is and what it takes to partner with us' refering to EWC's deal.  What I think has happened was this.   We know, after approval,   EWC was black-balled by DPE and IBs solicited alternate proposals.  Those bids were coming in substantially below EWC's terms for both IOC and PNG as EWC was no longer the benchmark for bidders.  IOC had been steadfast promoting IOC to PNG as the best option.

A combination of low bids, labor shortages, conventional project costs overuns and lobbying of O'Neill/DPE led to a 'significant meeting' a couple of weeks ago.  I think at that meeting, EWC was agreed to by O'Neill as an approved solution for Gulf LNG 'if' IOC chose them as winning bidder.   Indo site visits of EWC facilities were made by O'Neill as part of his DD.  We do know that EWC technology is endorsed by JP and Mitsui was willing to finance a $1 billion CSP to make EWC possible.  We learned in CC yesterday that Gulf LNG is endorsed by NEC/O'Neill and EWC is still 'in the mix' and they are financable.

I think EWC has returned as the bidder to beat and final offers are now being solicited to possibly attract a proposal with even better terms.  I agree this could well happen quickly.

[Libtardius Maximus]

Given the shroud of secrecy we've seen in the last two days alone I can't help to think that PM has seen the number for the selected bidder, but not the bidder by name and said, yea, we can do that number.

SD is coming first.

[bertl05]

Hey Lib, Your post induces me to post a theory I've been hatching.  EWC was initially IOC's prefered LNG producer as the terms were unprecedented.  1.5 yrs. ago Phil said 'the world now knows what our deal is and what it takes to partner with us' refering to EWC's deal.  What I think has happened was this.   We know, after approval,   EWC was black-balled by DPE and IBs solicited alternate proposals.  Those bids were coming in substantially below EWC's terms for both IOC and PNG as EWC was no longer the benchmark for bidders.  IOC had been steadfast promoting IOC to PNG as the best option.

A combination of low bids, labor shortages, conventional project costs overuns and lobbying of O'Neill/DPE led to a 'significant meeting' a couple of weeks ago.  I think at that meeting, EWC was agreed to by O'Neill as an approved solution for Gulf LNG 'if' IOC chose them as winning bidder.   Indo site visits of EWC facilities were made by O'Neill as part of his DD.  We do know that EWC technology is endorsed by JP and Mitsui was willing to finance a $1 billion CSP to make EWC possible.  We learned in CC yesterday that Gulf LNG is endorsed by NEC/O'Neill and EWC is still 'in the mix' and they are financable.

I think EWC has returned as the bidder to beat and final offers are now being solicited to possibly attract a proposal with even better terms.  I agree this could well happen quickly.

Palm I think you are correct here. However if correct there still could be substantial hurdles to overcome. I was told in no uncertain terms that some of the bidders , one consotium in particular was dead set against using EWC and would only consider modules built in their own country (financing would have been provided by their govt, hence that caveat). From my understanding this group was in the catbird seat as a bidder, a real solid bid and overall offer.

So either they change their mind about EWC (possible, but unlikely) or there is another bidder with a comparable offer in terms of price and financing.

It really stood out to me that ONeils press release made a point f adding in the international operator requirement again, and that they made a point of the cancelling notice being officially suspended, not cancelled. My interpretation is that the disdain that DPE and Petromin has held for IOC has not evaporated (not that it matters if IOC gets an approved deal) I also think this disdain is the reason they want to separate themselves from IOC with their share of the gas. Overall I see the realtionship as still quite contensious.

In any case we still must have a international operator that will give ewc modules the nod . Thats very possible, I just dont see it being the JKM group.

[TomCrooz]

Hey Lib, Your post induces me to post a theory I've been hatching.  EWC was initially IOC's prefered LNG producer as the terms were unprecedented.  1.5 yrs. ago Phil said 'the world now knows what our deal is and what it takes to partner with us' refering to EWC's deal.  What I think has happened was this.   We know, after approval,   EWC was black-balled by DPE and IBs solicited alternate proposals.  Those bids were coming in substantially below EWC's terms for both IOC and PNG as EWC was no longer the benchmark for bidders.  IOC had been steadfast promoting IOC to PNG as the best option.

A combination of low bids, labor shortages, conventional project costs overuns and lobbying of O'Neill/DPE led to a 'significant meeting' a couple of weeks ago.  I think at that meeting, EWC was agreed to by O'Neill as an approved solution for Gulf LNG 'if' IOC chose them as winning bidder.   Indo site visits of EWC facilities were made by O'Neill as part of his DD.  We do know that EWC technology is endorsed by JP and Mitsui was willing to finance a $1 billion CSP to make EWC possible.  We learned in CC yesterday that Gulf LNG is endorsed by NEC/O'Neill and EWC is still 'in the mix' and they are financable.

I think EWC has returned as the bidder to beat and final offers are now being solicited to possibly attract a proposal with even better terms.  I agree this could well happen quickly.

Palm I think you are correct here. However if correct there still could be substantial hurdles to overcome. I was told in no uncertain terms that some of the bidders , one consotium in particular was dead set against using EWC and would only consider modules built in their own country (financing would have been provided by their govt, hence that caveat). From my understanding this group was in the catbird seat as a bidder, a real solid bid and overall offer.

So either they change their mind about EWC (possible, but unlikely) or there is another bidder with a comparable offer in terms of price and financing.

It really stood out to me that ONeils press release made a point f adding in the international operator requirement again, and that they made a point of the cancelling notice being officially suspended, not cancelled. My interpretation is that the disdain that DPE and Petromin has held for IOC has not evaporated (not that it matters if IOC gets an approved deal) I also think this disdain is the reason they want to separate themselves from IOC with their share of the gas. Overall I see the realtionship as still quite contensious.

In any case we still must have a international operator that will give ewc modules the nod . Thats very possible, I just dont see it being the JKM group.

Do not refer to Tree's posts as posts from Palm.  They are fighting for rankings and it causes bad blood. hohoho

[Palm]

Bertl, please disregard Crooze's statement he has ratings envy. Besides that he's been out trying to bag a deer and keeps missing these prize bucks. We found out why today. This top notch bow he has been using is from Wal-Mart and the arrows come complete with rubber suction cups; he forgot to take them off. Now there are a couple of prize bucks running around with little white arrows stuck to their sides.

With EWC its a story of an innovator treading into territory dominated by bigs. But that world is changing as more and more of the projects are breaking the bank budget-wise and financing is getting tougher and governments like PNG, Indon, The Philippines etc are taking a hard look at the traditional model. I remember you and Michael S on Yazoo stating several times that you were hearing Shell would be forced on IOC and EWC had been kicked to the curb. EWC has never been out as far as IOC is concerned. We all have our sources but I can't believe that my sources know all of what is going on behind the scenes, nor should you believe yours do. We have all been surprised many times as this has progressed.

As far as the international operator "being added in again"; that requirement was never rescinded. That's standard requirement of PNG. OSH had to bring one in, and it was EXXON. IOC's PA required it from the start. The point was stressed with IOC when they tried to stray from it saying they had enough experience on their team. PNG reiterated the requirement to them some time ago.

The interesting thing that no one has pointed out yet is that PNG seems to have made a shift in strategy. They have always said a project must be fully integrated as PNG LNG is. They even stated that to IOC strongly at one point when IOC introduced EWC and Flex plans. This PR says nothing about that and mentions the possibility of two separate LNG plants. We've heard that there was a major breakthrough with the government. We've heard that O'Neill suddenly decided to pay a visit to Indon to tour the EWC "facilities" there. He then stated that he was very impressed with what he saw and and knew how to help EWC avoid some of the roadblocks it had encountered. I think we can interpret that as super majors who interfere with EWC's success like they ran into in both Indon and PNG. In PNG EWC was blessed by the government until Shell came along. IOC had a very good relationship with both Petromin and Duma before Shell came along. When O'Neill came in he smacked Shell and told them to stop with the old ways and come in "through the front door". I'm not so sure everyone at Petromin is against IOC. O'Neill is very smart. His two committees he has appointed to oversee the process contain several very loyal people and they have just 2 weeks. Very short time to hammer this out. Keeps people more honest.

And to read too much into this termination clause being suspended pending the negotiation is a little dangerous. Its as much a way of saying, "Enough talk, get it hammered out". O'Neill has repeatedly said he wants to work with IOC to get things finalized and fast-tracked.

Interesting thing will be to see that IF they do a separate LNG plant, where will it be and will THEY choose EWC to do power plants, LNG and possibly the CSP? Could happen.