LNG 0.00% 4.3¢ liquefied natural gas limited

Clues in the Cheniere price chart?

  1. 2,439 Posts.
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    Might be an opportune time to examine a Cheniere price chart (from a Fosters report available on the LNG website) which i have attached for clues as to how future value may be unlocked.

    Although cheniere were starting from a much higher base than LNG, you will see that there was a 600% uplift till FID then a further 200% uplift during the construction phase.

    If Magnolia is worth $10 unrisked, then trading around $3-4for FID completion and then adding another $6 during construction phase as the project becomes ultimately derisked and first revenues come to hand would follow the trajectory of Cheniere. Of course this ignores any valuation that the market may be giving for Bear Head which complicates things.

    So looking at our price now Im not thinking the market has gotten way ahead of itself using Cheniere as a baseline. The market has rewarded the $660m equity commitment, FEED, port leases, tolling term sheets, EPC term sheet and FERC filing. I think however the market may have already priced in binding EPC and toll agreements.

    Perversely, as an investor would we be feeling more comfortable if the stock was at $2.50 and make it a firmer hold or buy because it makes you feel like it hasnt come up "too fast" (whatever that may mean)? Rather than the market actually agreeing with you and attributing value which should actually make you feel more comfortable in your investment analysis?

    In any case a sincere good luck to all investors. Its been a lot of fun discussing the stock with a lot of knowledgable and willing to share holders.
 
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