It may increase the potential of the target if it is more clearly defined as larger or thicker reservoir than previously thought. We don't actually have any reserves until the wells are tested. The results were good enough for the management to acquire an independent assessment of the result and development plan. Hopefully they will come up with the lowest cost development and best use for our rig. They initially drilled Douglas hoping for liquids they may have evidence of migration of liquids on the block and go for the near by puk puk structure. Either way with rig on hand and a potentially large commercial gas accumulation £11m is looking cheap. If there is a clear plan on Douglas it is no longer stranded, like the MD of Austral says they will then be out selling it to other parties for financing development. A bank or major player could come in and fund a good deal of this if the results justify it (hopefully in the report tomorrow).
Take Sunshine gas as an example on the ASX. They have a potential 160bcf Overson gas field (not proved up fully as yet) MOU has been signed by Sojitz a major Japanese financier ($42bn turnover) for the development of the field and infrastructure for a WI basis. If Douglas is of substantial quality we could get a similar deal, and one of their CBM plays they are in negotiations for a fertilizer development. There is a number of ways this onshore gas could be developed, hopefully all shall be revealed tomorrow.
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