Some of the things we were able to take down (we had some technical problems, a Microsoft update restarted the PC automatically in mid presentation, thanks Microsoft!). Our own comments are in [brackets]

On Elk/Antelope

• New flow rates are “extremely strong”. [No surprise here..]
• Over 2,000 feet thickness is unusual. [It indeed is.]
• Elk and antelope drill sites appear connected, as originally predicted. [seems like Ross Smith bites the dust]
• Matrix porosity is high. [This is very important as it moves us from the low to the high part of the resource estimate. Ross Smith bites the dust again]
• There are some signs of an oil leg in Elk4 but they were unable to test the bottom of Elk4. This is speculative, but on the other hand, there are few oil finds without gas.

On refinery and downstream business

• “2nd quarter of (downstream) margins were hugely improved, from 4 million, up to 25 million compared with the same quarter a year ago.
• [Margins improved, the new pricing structure seems favourable, we might have gotten that wrong the first time around. It bodes well for the future, there is real structural improvement going on the last two years, and there is ample room for more as the refinery operates only just over half capacity. This is improving as well. And this development will accelerate dramatically when one of the proposed LNG projects will start the construction phase]

On third party resource estimate

• 8 weeks from completion from well
• [so could be 9-10 weeks from now. It is a formal proving of at least some part of the reserves so that they can put these on the books]

On liquidity

• $29 million is current amount of cash on hand. [They also have a stand-by credit facility]
• Sale of part of Elk/Antelope will provide enough funds for speed up in drilling and pay towards LNG facility. It seems that these negotiations are in a relatively advanced state. [The waiting is probably for the third party report to fill in the numbers]

On Antelope1

• Drilling with a bigger pipe
• [Wow, the effects of that can be seen from the first two DST’s in Elk4 (around 10MMcf/d) to the fourth DST (63.9MMcf/d). The difference was just the pipe they used]

On liquidity stripping plant

• Too small a separator caused problems [separating the liquids from the gas. Prevented proper assessment]
• Refining study from a year ago, will take 1-2 months

We’ll report more when we have it.