Tuesday, 23 September 2014

Metgasco Limited circles the wagons and hopes forthcoming court case will order compensation?

Coal seam-tight gas exploration and wannabee production company Metgasgo Limited - having first failed to convince the NSW Government that it had fully lived up to the terms of its PEL16 exploration licence and then apparently failed to convince that same government to voluntarily hand over $120 million in go away money compensation because there was no possibility of it extracting any commercial gas from its Northern Rivers tenements in the foreseeable future - appears to be reordering its books to maximise the dollar potential with regard to hoped for court-ordered compensation once legal proceedings have wended their way through the state legal system.

Excerpt from Metgasco media release, 19 September 2014:

Asset update

Metgasco Limited (ASX: MEL) announces that in light of the uncertainty arising from the political environment in New South Wales and its impact on the business environment for energy exploration and production companies, the Board of Metgasco has:

      * formally assessed the amount of capitalised exploration and evaluation expenditure included as an asset on the Company’s balance sheet, and has determined as a matter of prudent judgement that this amount should be impaired to nil; and

      * decided to reclassify its gas reserves as resources.

Commenting on the asset impairment and reserves reclassification, Metgasco’s Managing Director, Mr Peter Henderson said: “The Board fully considered these accounting matters and considered that the changes are appropriate to properly reflect the state of Metgasco’s New South Wales business interests.  The Company’s current share price indicates that the financial market has already recognised the New South Wales political climate and its effects on Metgasco.  Despite the asset impairment and reserves reclassification, Metgasco remains committed to pursuing the significant gas potential in its New South Wales exploration licences.”……

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