RE:RE:RE:CGX VALUATIONSRapsani -
I would speculate a farm-out is very likely at this time.
One farm-out option may include CGX divesting part of their interest (say around +33% interest) and relinquishing operatorship (either prior to exploration drilling or immediately after) to a super-major or large E&P. In turn, CGX obtains a complete carry of all future exploration, appraisal and development costs, similar to what Apache has obtained. This is a massive deal involving billions of dollars that CGX will be largely carried for. Frontera, of course, would have to pay their 33% share of costs unless they participate by divesting part of their 33% interest for a similar carry.
Another option may be for a prospective JV partner wanting to acquire an even larger stake - perhaps all of CGX's 66.7% interest in both offshore licenses. In this scenario, Frontera would perhaps vote in support of a larger playering offering to buy CGX outright. It's probably not the ideal path Frontera/CGX would want to pursue and would rather sell over time (after multiple discoveries have been made and in position to maximize value for their assets).
However, this is the hottest and most prolific basin in the world. As Hess mentioned on their recent earnings call - they would not ever considering selling their interest in the basin as its the most attractive asset in the world in terms of profitability, resource upside, etc. In fact, they would prefer to add to their existing position in the basin (if possible).
So, if an acquirer came in and offered to buy out CGX for billions of dollars - for which the acquirer would obtain 66.7% interest in both licenses and operatorship - it may be something Frontera would consider. Of course, such an offer would have to be at a significant premium.
I personally don't think a super-major would be interested in taking an equity interest in CGX - unless they were able to buy CGX out right. In turn, would probably rather proceed with a venture arrangement by acquiring a direct interest in the blocks with a clear path to operate the asset.