The Roma North gas facility was commissioned on May 27. The company is on track to deliver processed sales gas to GLNG by mid-2019. The main concern for Credit Suisse is the pace of the production ramp-up upstream rather than the processing facility.
Ramp up has proven challenging at other CSG projects, compared with FID expectations. There is limited information on Roma North’s upstream ability to deliver.
The broker prefers to wait, with a Neutral rating and $0.36 target, until further production and cost data materialises over the next 12 months.
Target price is $0.36.Current Price is $0.31. Difference: $0.05 – (brackets indicate current price is over target). If SXY meets the Credit Suisse target it will return approximately 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).