Longs on this board, following are the analysis and research extracts data on LNG prospects:

(1) What about Gas Price?
Parity to Oil at 9x is no more the norms, thus we will get to a 11x or 15x to Oil as per the estimates in the next 2 quarters. Means since oil will be bound with 70 to 80$ range, gas would go to $5.3 range. This is not good for the long run but for short term (next 2 quarters) this is good. Long term - gas is pegged at $6.8 means good receivables for LNG.

(2) Why would LNG make in-the-money?
Qatar would reduce the gas production cost further by 7% to 12% annualized rate. Effects on gas exports both to EU and NAM regions, would trigger lower cost of purchase (if paid in full - not hedged or financed). LNG would take delivery at a rate at-least 5% lower than the last months receivables. That means a post-tax balance, margin of 3 to 5% which is good for all of us.

(3) PPS Pricing - why low?
Those who "worked" this PPS down, tend to gain "only if" PPS goes up, so if the analysis is right, Q4 of 09 and Q1 of 2010 is when the PPS should be at +$3.5 for us to prove that gas-distribution and asset-dwellers like LNG has a business model to exist. Also note that heavy accumulation is on the books because after the sell-off from last Oct-08, we expect the allocations from big boys to come in; this book-closing & tax season of dec-2009.

(4) Better margins?
Lower operational cost from functional business, higher margins on a week-on-week basis, better hedging based on predicted delivery dates, lower factoring percentile from the banks, higher distribution-ratio from third-parties - "MANY" sources will add to a better margin soon.

Big boys want that $50m loss back on the books, "before" closing the 3-year tax-write off. Things are changing here soon. Hope to scope some profits here soon.

Take care and have a nice day.