WestLakes Update - $71 Target

[Tree]

"While we and the market were disappointed by the value, complexity, and initial explanation of the deal, we are encouraged by the potential upside."

Not yout father's asset sale.  IOC nets a $9 Billion chunk of an LNG project and will be funded for that and much exploration.  (Not to mention other SD's)  

[Putncalls]

71 sucks

[Tree]

"After substantially adjusting our model, we value the stock at $71/share on our base case with downside / upside scenarios of $30 and $91/share. (See page 6 for details) The primary driver of the upside would be a larger resource assessment providing for a larger LNG facility, where IOC’s ownership would be largely funded by the resource payments received. The primary driver of the downside is a lower resource assessment, where IOC would need to fund its contributions to an LNG facility out of corporate cash."

[Palm]

"The retained 30% interest in the potential LNG project was the major reason why IOC selected Total"

[Putncalls]

Still sucks

[SamAdams]

This is called pay back for cancelling their conference and MH not guiding the street better on deal price. We are lucky RJ and MS weren't lower, frankly. All IMO.

[Palm]

All onus is now on IOC as far as Total, analysts, the market and ultimately shareholders; deliver on all cylinders going forward and then it will be credited to you.

[Tree]

"The resource payments that IOC receives will cover some (possibly all) of its equity contribution to a potential LNG project, and IOC will
not need to raise money to fund its exploration program.
The structure of the deal does imply that Total has a significant degree of confidence in Elk/Antelope to put at risk over $811 MM prior to
any LNG project expenditures or a ~19% Farm down to Oil Search, Ltd. (ASX:OSH).
While this is small relative to Total’s upstream capex ~$20 B, it is still sizeable. We do not believe Total would risk that level of capital if
it was not ~80% confident there was enough gas to proceed with a single train LNG project (4-5 Tcfe). We also think it is unrealistic to believe any player would put forward the several billion dollars required for the full 9.9 Tcfe of potential resources, without some substantial independent work."

[ebster123]

"The retained 30% interest in the potential LNG project was the major reason why IOC selected Total"

palm, you rate IOC on what WE see.  The market sees different!!

[Palm]

"The retained 30% interest in the potential LNG project was the major reason why IOC selected Total"

palm, you rate IOC on what WE see.  The market sees different!!

Uh, Ebster no I don't. Read what I said elsewhere on where IOC goes from here with analysts, THE MARKET and shareholders.

The comment in quotes is from the Westlake report. Have you seen it?