Armour Energy (AJQ)

23 Pages·2014·1.24 MB·English

4 March 2014

Analyst Armour Energy (AJQ)
Di Brookman 612 8224 2859

Leverage to Frontier Oil & Gas
Authorisation
TS Lim 612 8224 2810

Recommendation Monetising early success is the next step
Buy
(Initiation) Although 2014 will be a quieter year for Armour, it will complete the post frac test of
Price Egilibria-2 in 2Q14, spud Otway-1 shortly in Victoria and drill 2 more wells in the
$0.155 Northern Territory to expand the 2C resource already on its books. With 5 gas flares
from 7 wells and 14m acres granted it has the industry’s attention and has signalled it
Target (12 months)
is looking for a partner to further progress exploration. Management’s ability to execute
$0.25
(unchanged) a transaction will be the litmus test of value as the market has Armour trading at
Risk $1.70/acre versus the Frontier peer multiple of $4.90/acre & a Frontier industry
Speculative transaction value of ~$19/acre. Once funding concerns are removed Armour should re-
rate to trade at a premium to its frontier E&P peer group. SPECULATIVE BUY.

Conventional potential underwrites shale gas
Expected Return
Capital growth 61.2% Armour has proved that its strategy of targeting unconventional shales lying within
Dividend yield 0% structural closure has been the correct one with 6Bcf of gas in the 2C category and
Total expected return 61.2% another 55 look alike leads on its books. All great news but having a commercial
Company Data & Ratios mandate is paramount. Possible short term channels to market include gas swaps with
Enterprise value $25.6m local mines and micro LNG for trucking and power generation. Some 520m of oil
Market cap $46.6m shows within the Barney Creek Shale at Lamont Pass-3 have Armour looking for
Issued capital 300.8m conventional traps in deeper settings. Key risk is ability to extract commercial
Free float 74% quantities of gas.
Avg. daily val. (52wk) $25,000
Investment thesis
12 month price range $0.15-$0.375
GICS sector
The enthusiasm held by Armour for the McArthur Basin has been supported by the drill
Energy
bit since listing in 2012. Five of 7 wells have intercepted hydrocarbon with 4 flaring

gas whilst drilling. With all the shale activity in Australia Armour is the first to flare gas

Price Performance from a horizontal well whilst drilling. Armour is moving fast to establish its technological
edge. If Armour can execute a quality farm-out the markets short term funding
(1m) (3m) (12m)
Price (A$) 0.18 0.24 0.33 concerns should be addressed. Our target price of $0.25/share is based on a
Absolute (%) -8.57 -33.33 -51.52
Rel market (%) -12.58 -33.89 -58.73 combination of market and transaction multiples. If a transaction is secured, we
see a pathway to $0.36/share and beyond (refer page 18).
Absolute Price Earnings Forecast
Year ending June 30 2013A 2014E 2015E 2016E
$1.00
$0.90 Revenue ($m) 2 - - -
$0.80 EBITDA ($m) (3) (5) (5) (5)
$0.70 NPAT - reported ($m) 2 2 6 (1)
$0.60
NPAT - underlying ($m) 2 2 6 (1)
$0.50
$0.40 EPS - underlying (c/sh) 0.5 0.8 1.8 (0.4)
$0.30 EPS growth (%) n.m n.m n.m n.m
$0.20 PER (x) 29.4x 19.6x 8.4x -34.8x
$0.10
FCF yield (%) -39% -66% -8% -3%
$0.00
EV/EBITDA (x) -6.3x -10.6x -12.6x -12.6x
Apr Jul Oct Jan Apr Jul Oct
12 12 12 13 13 13 13 Dividend (c/sh) - - - -
AJQ S&P 300 Rebased
Yield (%) - - - -

Franking (%) - - - -
ROE (%) 1.8% 2.8% 6.1% -1.5%
SOURCE: IRESS SOURCE: BELL POTTER SECURITIES ESTIMATES
BELL POTTER SECURITIES LIMITED DISCLAIMER AND DISCLOSURES Page 1
ACN 25 006 390 7721 THIS REPORT MUST BE READ WITH THE DISCLAIMER
AFSL 243480 AND DISCLOSURES ON PAGE 23 THAT FORM PART OF IT.
Armour Energy (AJQ) 4 March 2014
Contents
Leading the Shale Gas Charge in Australia ................................. 3
The Land Bank ............................................................................... 5
The Discoveries – conventional & unconventional..................... 6
Current Resource Estimates ....................................................... 13
Channels to Market ...................................................................... 14
Peer Analysis ............................................................................... 15
Transaction Multiples .................................................................. 16
Valuation ....................................................................................... 18
Key Board & Management ........................................................... 20
Company Profile & Risks ............................................................ 21

Figure 1 – Armour Permits – expansive exposure to conventional and unconventional plays

SOURCE: COMPANY DATA

Figure 2 – Gas Flare at Egilibria-2 in North West Queensland Figure 3 – Gas Flare at Cow Lagoon in Northern Territory

SOURCE: COMPANY DATA SOURCE: COMPANY DATA

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Armour Energy (AJQ) 4 March 2014
Leading the Shale Gas Charge in Australia
Executive Summary
The $75m IPO of frontier explorer Armour Energy in March 2012 positioned the start of an
Armour secures a
active exploration program in the Northern Territory’s McArthur Basin and Queensland’s
large footprint and
Nicholson Basin. The success encountered in the Northern Territory in particular has
has early success in
very old by passed startled the industry globally but the impact on the market has been underwhelming. It
rocks… seems fear around perpetual equity dilution by small companies as they attempt to fund
their unconventional activities has engulfed the market. The challenge for investors is to
identify companies that control large prospective acreage position acquired during the
gazettal process. These companies offer the potential for significant returns. Armour
A subsequent land
appears to be one of those, but its story must now be supported by a quality farm-out that
grab has followed…
is able to bring cash and sizeable explorations carry to the table. Confirm an ability to
deliver on capital management and the company and its shareholders should be rewarded.
Santos will drill in Technically the McArthur Basin is very exciting. Santos recently stated at its December
adjacent blocks in 2013 Investor Briefing that “we arrived at the McArthur after a systemic evaluation of
2014 all onshore basins in the country looking for unconventional plays and the McArthur
rocks looked the best” further adding that the McArthur “rocks appear to have the
attributes that are required to deliver a real outcome of scale”. After shooting 500km
of seismic in 2013 Santos has indicated that it will drill a couple of wells in 2014 in blocks
adjacent to Armour - providing nearology for Armour shareholders.
Since the IPO less than 2-years ago, Armour has drilled 7 wells with 3 wells flaring gas
whilst drilling. More notably Glyde-ST1 flowed up to 3.3MMcf/d whilst surface testing the
conventional Coxco Dolomite, Lamont Pass-3 intercepted over 500m of oil shows in the
Barney Creek Shale and Armour was the first in Australia to flare gas during the flow back
of frac fluid from Egilibria-2 - a fracced horizontal shale well in the Nicholson Basin. The
aim of the E&P program was to prove commercial hydrocarbons. As hoped, the drill
program did more than verify the unconventional 18.8Tcf mean prospective recoverable
resource it also supported the decision to drill on structure to test for conventionally
Conventional 3C gas
trapped hydrocarbons with SK Consulting estimating a potential mean recoverable
resource awarded to
prospective resource of 3,469PJ within the Coxco Dolomite. This assessment represented
Glyde-1 discovery…
a 10-fold increase over IPO estimates and substantiated earlier 3C conventional gas
estimates made by DeGoyler and McNaughton (D&M) of 10.3Bcf 3C resources for the
Glyde-1 gas discovery. With another 55 conventional leads already on the books, the
…with another 55
conventional upside is significant leaving the unconventional resource as a live play with
leads already on the
further investigation required to see if the shale gas potential extends off structure - as it
books
seems to in its Nicholson Basin acreage in ATP 1087.
A quick summary of achievements to date;
 May 2012 Cow Lagoon-1 (net 100%) – A vertical well in the MacArthur Basin
produced numerous gas flares over a 15-day period from the Lynott and Reward
Dolomite Formations. Wet gas shows with very low CO were also noted in the
2
middle Proterozoic Barney Creek Shale and Coxco Dolomite.
 July 2012 Resource Assessment – A mean prospective recoverable resource of
100.4Bcf was internally assessed against the conventional Reward and Lynott
units at Cow Lagoon-1 and targets later delineated by SRK 2013 study.
 August 2012 Glyde-1 (net 100%) – a lateral well in the Coxco flowed at varying
unstimulated rates whilst surface testing. After a 30-minute shut-in and 10
minutes of testing on a full open choke, the lateral flowed gas from the Coxco at

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Armour Energy (AJQ) 4 March 2014
3.3MMcf/d at a surface pressure of 125psi. In April 2013 the resource certifiers
estimated a 3C resource of 10.3Bcf of conventional gas at Glyde (refer page 8).
 Lamont Pass-3 (net 100%) – a vertical well intercepted 500m of oil shows in the
Lamont Pass-3 had
over 500m of oil Barney Creek Shale substantiating the units oil potential and increasing the depth
shows in the window of prospective oil shows in the Barney Creek relative to MBA’s estimates.
unconventional
 Egilibria-2 flared gas from the Lawn Shale intermittently during drilling and during
Barney Creek Shale flowback of the post-frac fluids it became the first horizontal shale well in Australia
to flow gas to surface. The flowback was suspended with the arrival of the wet
season and activities are expected to resume 2Q14.
 November 2013 Gas resource upgrade – SRK Petroleum Consultants updated
the Northern Territory mean prospective conventional gas resources increasing
them from 322PJ to 3,496PJ, whilst the mean prospective unconventional
resource potential in the Northern Territory remains 18.8Tcf.
 Hallmarks of a viable shale gas play – are highlighted by Armour at its recent
AGM with shale thicknesses greater than 100m, high TOC, 1,700m of gas
charged sediments, naturally fracturing and low drilling/stimulations costs.
Securing a competitive advantage in the unconventional space
Northern Territory
 First mover advantage rewards with large 60,534km2 footprint (Armour 100%)
gas looks rich and
low in CO  Conventional potential supported by unstimulated flow of up to 3.3MMcf/d from
2
Coxco Dolomite. Have 55 look alike leads. Unlike the Coal Seam Gas (CSG) in
East Queensland Armour’s Northern Territory and Queensland acreage is
pastoral leasehold and used for low intensity grazing with no cropping
 CO levels are very low (<1%) compared to the Cooper Basin with ~30-40%
2
 Thick organic rich marine shales with a TOC of ~8% compared to terrestrial
silts and shales in the Cooper with TOC’s ~2%. Shows at Lamont Pass-3 support
A farm-down will be
required to fund presence of oil window to 780m depth at that location
exploration beyond  Fraccability - The Egilibria-2 was able to identify prospective intervals where
2014 and re-rate the successful fracs could be placed. Egilibria-2 frac, will resume flow after the wet
stock
season and will improve prospectivity if a continuous gas flows can be achieved.
Financials – cost reduction initiatives & farm-down of equity position
The APA agreement Armour exited December 2013 with $11.3m of cash, a $10m holding in Lakes Oil and no
and STO’s debt. Cash levels are expected to be reduced to $6.6m at end 1Q14.
enthusiasm over the
Exploration in 2014 will be funded from cash and an R&D tax refund. In 2013 Armour
geology at its recent
received a refund of $4m and a refund in the order of $9-11m is likely in 2014.
Investor Briefing
should underwrite Armour recently announced a “strategic initiative” to proactively address key short and
interest in the longer term funding risks. Key takeaways from the ASX announcement include;
McArthur Basin
 Board fees and management fees have been reduced by 33% and 20%
respectively. The CEO has taken a 20% salary cut and agreed to buy 325,000
shares at $0.20/share (11% premium to last close). Consequently, Armour’s
corporate cash burn rate will decline from $0.5m to $0.3m/month.
 Armour indicated it has been approached by and is “in discussions with a number
of parties” re the farm-down of equity. This suggests Armour has a preference
towards monetising its high equity interests rather than dilute at the equity level to
fund ongoing exploration. The Armour IPO was dealt at $0.50/share.
 If management can execute a quality farm-out and de-risk the business, a re-
rating should follow.

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Armour Energy (AJQ) 4 March 2014
The Land Bank
 The rocks are old being laid down ~1.7Bn years ago. Preconceptions were that
Armour has one of
the largest land the rocks did not contain adequate hydrocarbons. Excitingly the numerous gas
banks of a listed E&P flares and oil seeps have all but been disproved the sceptics by demonstrating
explorer in Australia potential from algae formed, organic rich shales. Now the long journey towards
monetisation with scale commences.
 Armour believes it has identified 100 conventional and unconventional targets
across its Queensland and Northern Territory permits
 Given early success the next logical step is to bring in a competent farm-in
partner that can further unravel the potential captured with in Armour’s portfolio
 TOTAL, Statoil and Santos have acquired exposure in the McArthur Basin since
the Armour IPO. Any activity in those blocks will provide nearology for Armour.
Santos has recently completed shooting a 500km 3D-seismic program as part of
its Phase-1 farm in commitment with unlisted Tamboran Resources
Figure 4 – Armour’s Permit Position
Tenements Location Interest sq. km Gross Acres Net Acres
EP 171 NT 100% 3,473 8 58,196 8 58,196
EP 174 NT 100% 4,340 1,072,436 1,072,436
EP 176 NT 100% 8,032 1,984,747 1,984,747
Since listing Armour’s EP 190 NT 100% 1 2,818 3,167,392 3,167,392
EP 191 NT 100% 1 5,246 3,767,363 3,767,363
footprint of granted
EP 192 NT 100% 9,487 2,344,285 2,344,285
permits has grown from
ATP 1087 QLD 100% 7,138 1,763,835 1,763,835
11,500 to over 60,000km2 PEP 169 Vic 51% 1,133 2 79,970 1 42,785
(refer below) PEP 166 Vic 25% 1,751 4 32,681 1 08,170
Granted Permits NT 100% 5 3,396 1 3,194,419 1 3,194,419
Granted Permits Qld 100% 7,943 4,847,327 4,847,327
Total Granted Permits 60,534 14,958,254 14,958,254
Total Unallocated Permits 73,012 18,041,746 18,041,746
Victoria 2,884 712,651 250,955
Total 124,757 33,712,651 33,250,955
SOURCE: COMPANY DATA

Figure 5 - Armour at the IPO – preferred tender status in blue Figure 6 – Armour Today – with granted permits in yellow

SOURCE: COMPANY DATA SOURCE: COMPANY DATA

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Armour Energy (AJQ) 4 March 2014
The Discoveries –
conventional & unconventional
 Listed April 2013 and already drilled 7 wells of which 5 wells flared gas
 A surface test flowed gas at up to 3.3MMcf/d through a 1 inch choke
Proved the presence
 Conventional certified mean prospective recoverable gas resources of 3,496PJ
of a petroleum
system in the  Un-conventional certified mean prospective recoverable resource of 41.3 Tcf
McArthur and
 Intercepted structurally trapped gas as well as a continuous gas column in
Nicholson Basin
Nicholson basin situated beyond closure as occurs in the Cooper Basin
 Egilibria-2 fracced and produced gas during incomplete flowback

Figure 7 – Glyde-ST1 (EP 171) flow test at 3.3MMcf/d Figure 8 – Egilibria-2 (ATP 1087) flare during post frac flow back

SOURCE: COMPANY DATA SOURCE: COMPANY DATA

Figure 9 - Lamont Pass-3 – Streaming cut from Barney Ck shale Figure 10 - Lamont Pass-3 - Live oil in Barney Ck Shale

SOURCE: COMPANY DATA SOURCE: COMPANY DATA

Figure 11 - x
Well State Basin Permit Equity InteresUtnit Result
Cow Lagoon-1 NT McArthur EP 176 100% Lynott & Reward Flowed numerous dry gas flares over a 15 day period
Glyde-1 NT McArthur EP 171 100% Coxco Dolomite Flowed wet gas unstimulated at up to 3.35MMcf/d
Lamont Pass-3 NT McArthur EP 190 100% Barney Ck Shale Intercepted 500m of live oil shows in the Barney Ck shale
Egilabria-2 Qld Nicholson ATP 1087 100% Lawn Shale Flared gas during post frac flow back
Egilabria-4 Qld Nicholson ATP 1087 100% Riversleigh Shale Intercepted 250m gas saturated shale out of closure
SOURCE: COMPANY DATA

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Armour Energy (AJQ) 4 March 2014
Northern Territory – McArthur Basin – oldest hydrocarbons in the world
 The McArthur Basin sediments are ~1.6Bn years old
 The Barney Creek Shale acts as a source & seal & is regionally extensive
 Certifiers map the Barney Creek as wet gas mature over 40% of its permits
 Lamont Pass-3 extended the oil window from 350 to 780m

The McArthur Basin overlies the eastern edge of the north Australian craton. Armour’s
permits lie in the southern section of the Basin. The sediments were laid down in a shallow
to deep marine setting during the mid-Proterozoic times, when single celled algae were
the only life form and the atmospheric oxygen levels were 25% of todays. Commercial
precedents to this primitive anoxic environment are provided by the oil and gas fields in
East Siberia, which are believed to be sourced from thick 1.4Bn year old anoxic shales.

Figure 12 –McArthur Basin Prospects and Leads Map
Thick organic rich
marine shales with
low Co gas…
2

…A polar opposite to
the terrestrial /deltaic
sediments of the
Cooper Basin where
CO can be as high
2
as 40%

SOURCE: COMPANY DATA

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Armour Energy (AJQ) 4 March 2014
1. Cow Lagoon-1 (EP 176, net 100%)
 Tested the conventional targets in the Coxco, Lynott and Reward Dolomite
 Unconventional targets in the deeper Barney Creek Shale above the Coxco
 Well flowed numerous dry gas flares over a 15-day period
Located ~25kms

from the McArthur
River gas pipeline Cow Laggon-1 is located 90km north of the Amoco well GR-9, which flowed around 0.3-
0.4MMcf/d from the Coxco Dolomite for about 6 months before being shut-in at 140 psi in
1979. The air drilled well intercepted ~1,045m of gas saturated rock to the top of the
Coxco Dolomites at a depth of 1,308m. However, Armour reports the primary Coxco was
water wet and out of structural closure at this location with potential trapping updip as
indicated by seismic reprocessing. A full suite of logs were run and the younger secondary
Lynott and Reward Dolomites along with the primary Barney Creek Shale were interpreted
to be fully gas charged and within mapped 4-way dip closure. The gas discovery was
suspended for potential re-entry.
Armour internally estimate that the Lynott and Reward Dolomites could hold a mean
recoverable prospective resource of 100.4Bcf across the Cow Lagoon structure, which
were later confirmed by the 2013 SRK Petroleum Consultants resource assessment.
Armour reports that seismic suggests that there is up- and down-dip potential from Cow
Lagoon in conventional and unconventional targets. Targets have been identified at
several locations based on regional seismic, gravity and aeromagnetic data (e.g. Batten
Creek, Looking Glass and Ryan’s Bend).
2. Glyde-ST1 (EP 171, net 100%)
 Well tested unconventional Barney Creek Shale located 61kms from McArthur
River Zinc Mine
Flowed up to
 The well intercepted the down hole location of the historic GR-9 mineral hole
3.3MMcf/d of gas
drilled by Amoco in 1979
through a 1 inch
choke  Shale flowed gas unstimulated at up to 3.3Mcf/d through a 1” surface choke
 Gas contained 28.5% (C1), 4.1% (C2), 4% (C3), 0.43% (C4) and 0.05% (C5) with
only negligible CO
2
Glyde-ST1 was drilled as a vertical well down to the top of the Barney Creek Shale and
then horizontally to intercept hydrocarbons recorded in the Barney Creek Shale and Coxco
Dolomite by the mineral well GR-9 drilled by Amco in 1979. The well intercepted 132m of
black organic rich gas charged and naturally fractured Barney Creek Shale before drilling
The Barney Creek the lateral into the Coxco Dolomite. After a pre-flow and 30-minute shut-in, surface testing
Shale acts as a indicated a flow up to 3.3MMcf/d after a 15-minute at a wellhead pressure of 125psi from
source rock and seal the Coxco Dolomite from a vertical depth of only 500m. The source rock for the
to the gas trapped in hydrocarbons in the Coxco Dolomite is believed to be the overlying Barney Creek Shale.
the Coxco Dolomite
The well, which had a total measured depth of 840m, included a gas-bearing lateral
interval in the Coxco Dolomite of 192m, and also substantiated the source and seal rock
potential of the shale and the recoverable prospective unconventional resource potential as
assessed by MBA Petroleum Consultants of 18.8Tcf of gas by intersecting a 132m gas-
bearing Barney Creek Shale section.
Other wells drilled in the vicinity of Glyde included Myrtle Basin-1, which intercepted the top
of the Barney Creek Shale at depths deeper than prognosed, enlarging the area of Barney
Creek Shale prospectivity. This well was temporarily abandoned for deeper coring at a
later date.

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Armour Energy (AJQ) 4 March 2014
3. Lamont Pass-3 (EP 190, net 100%)
 A vertical well drilled in EP 190 within the Glyde Sub-basin to test the
conventional potential at Lamont-3 and more regionally the potential of the
Barney Creek as a source rock
 The base of the oil window was extended from 350 to 780 meters
Intercepted 520m of
oil bearing Barney  Extension of oil window down to 780m yields another 12,828km2 of potential
Creek Shale

Lamont Pass-3 is located 25km north of Glyde-1 in EP 190 and was plugged and
abandoned at a total depth at 1,275m, after successfully identifying an oil bearing interval
from a depth of 260m to 780m.
As the well exceeded its pre drill objective to test the oil window down to 350m, the
resource potential of the 12,818km2 Block is presently being re-assessed by MBA and
Armour is further evaluating the wider oil potential within the Batten Trough.
The occurrence of hydrocarbons at Lamont Pass-3 was evidenced by;
 Strong hydrocarbon odour and preliminary desorption readings, 970m of core cut
 Flaring of connection gases (up to 100 units by gas chromatography)
 Fluorescence with strong streaming oil cut (Figure 21& 22)
 Live oil in rock fractures at 535m and extensively in the Barney Creek Shale
As the well reached total depth whilst still in oil shows, there remains potential for the oil
window to extend below a depth of 780 metres within the underlying Wollogorang and
McDermott Shale source rocks of the Glyde Sub-basin. This well was drilled using lower-
cost mineral well rig and coring technology and could not be completed for further testing.

Queensland – Nicholson Basin – yet to find the sweet spot but gas abounds
 Awarded 7,138km2 ATP1087 in December 2012 & already drilled 2 wells
 Intercepted thick organic rich shales within the Lawn & Riversleigh shales
Armour was awarded  Lawn Shale holds mean prospective recoverable gas resources of 22.5Tcf
ATP1087 in and 242MMboe of liquids, as assessed by MBA Petroleum Consultants in
December 2012 and 2012. The Lawn Shale recorded up to 8% gas in mud whilst drilling Egilibria-
spudded the first 1, an offset to Egilibria 2, in the early-1990’s
well less than a year
 The presence of an effective petroleum system was proven by numerous
later
flares recorded at Egalabria-2
 Intercepted a thick, continuous, structurally trapped gas column situated
beyond structural closure as occurs in the Cooper Basin
 Proved that the thick Lawn Shale could be fracture stimulated to flow gas
Early analysis suggests that unlike the McArthur Basin the gas at Egilibria-2 & -4 is dry.
However, the 4 wells drilled by Comalco in the west of ATP1087 suggest the gas is wetter.
This combined with the interpreted continuous gas sequence in the centre of the basin
opens up the possibility that, like the Cooper Basin, the gas may become richer and
stratigraphically trapped towards the up-dip margins of the Basin. Armour has reprocessed
up to 1,100km of old seismic and completed a 3,000km2 airborne survey across ATP 1087
that together with new well information should assist the regional interpretation and the
placement of the next series of wells.

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Armour Energy (AJQ) 4 March 2014

Figure 13 – Queensland Tenement Map – Nicholson Basin

SOURCE: BELL POTTER SECURITIES ESTIMATES
Egilibria-2 (net 100%) - The gas discovery and was suspended for potential re-entry.
Egilabria-2 flowed
continuous gas
 Egilibria-2 is located 500m from Egilibria-1 drilled by Comalco using mud
whilst flowing back
based drill fluids in 1992 recording 8% gas through the Lawn Shale
44% of frac fluid
before being  Continuous gas shows from 700m to top of Lawn Shale at 1,640m and
suspended due to Numerous 5-8 metre flares recorded whilst air drilling
rain
 Gas flowed during flow-back of frac fluids but fluid recovery was halted
before monsoon commenced. Post-frac fluid recovery can resume post
monsoon as soon as 2Q14
The up-hole section was drilled with air until water and gas inflow to the well bore became
a problem. Gas peaks of up to 900 units (24%) were recorded above the Proterozoic target
intervals before running casing was run and switching to mud based drilling in the target
Proterozoic sections. This show in the overlying sediments substantiates Armour’s belief
in the conventional prospectivity within the younger sediments in the South Nicholson and
Carpentaria Basin.

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