NFG [Archive]

**goog** Wed Jul 11, 2007 12:02 pm

NFG
Hi Blast,

This idea looks very interesting. What do you think about it? Thanks

http://www.valueinvestorsclub.com/value2/guests/view-thread.asp?id=2798

**blast_investor** Thu Jul 26, 2007 12:09 am

Hi goog,

NFG certainly has an interesting story on its 0.77 million shale asset acreage gas resource play story.

on the other hand, I am not buying $5,500 per acre shale asset speculation. Nobody would pay that much today, and historical private market price did not suggest that. Particularly the article used Wall Street analyst' number, which many times gave out non-sense estimate.

Just give you a number for fun to think about. If 0.77million gas acreage can be worth up to $4 billion as suggested in the article, how much would 11 million acreage of gas acreage be worth?

CHK owns 11 million net acreage of gas resource play, including huge amount (close to 40%) of shale asset or other emerging non-convential gas asset.

Using the article's logic, CHK company value is going through roof, should be many times more than current 15 billion market cap.

I am not trying to say that $5,500 per acre can not be possible in the future, it may be. But what I am saying is that at current market condition, the valuation of gas acreage in private market is dramatically lower than this number.