MGM Energy Corp MGMCF

RE: Kogas deal read it carefully

[NobodyKnowsOne]

 From the Dec. 15, 2010 news release:

 " The sale price will be paid $20 million on closing and $10 million upon the decision to construct the Mackenzie Valley Pipeline or any other project to commercialize production from SDL 131."

  I believe the Koreans are proposing an alternative way to get the gas out of the Mackensie Valley. And I think it's a good idea. It makes a lot of sense to me to  avoid the expense and huge environmental disruption on the land, and simply build an LNG facility offshore for field collection and distribution by ship.

  As far as the price paid by the Koreans; I don't know for sure, but the forward sale of 20% of a field resource which still carries the risk of never becoming commercially viable is a good one. MGM gets $20M now, and most likely will be proving up more nat gas and possibly oil resources in the future.

  The company is doing what it can to survive.

  Nice uptick at mid-day. Close @ .23 is excellent. I think there may be news coming shortly about the pipeline or the rig permit or both.

  GL & Cheers

[OilEng]

KOGAS has agreed to purchase 40% of the LNG exported from the proposed Kitimat LNG plant.  This facility has  regulatory approval and is scheduled to come on stream in 2015: exporting LNG to Asia.  It is owned by Apache and EOG which are two big US energy companies.  The Mackenzie gas can flow to the Kitimat facilit.           &

[geodude13]

It's very unlikely that MGX Mackenzie valley gas play would flow to Kitimat as the tie-in would somehow need to get regulatory approval prior to the MacKenzie Valley Pipeline application. If interested you should to refer to the PNG presentation link provided below. As detailed in the presentation, the Kitimat destined gas is coming from the Horne River basin and also from the Montenay basin

[OilEng]

Hi geodude13;Thank you for pointing out the transportation issues of getting Delta Gas to the Kitimat LNG plant.  While I agree with you that the Horn and Monteney gas will be main uses of the LNG terminal in Kitimat, I respectfully think you are mistaken in your comments about the TCPL system not being tied into the gas system delivering gas to Kitimat. The TCPL system is already tied

[geodude13]

You're absolutely right about the TransCanada/Spectra tie-in and cost structure of pipeline tolls. I overly-simplified the notion of routing and transportation toll structure. However, the point of incurring additional tolls for gas that can be purchased more cost effectively through gas marketing contracts verses routing MGM product through several differently owned gas transporter