The buzz around the casino industry is that one of the major international casino operators has been seeking advice around tendering for the second casino licence in New South Wales, which comes up for grabs in 2019.
The interest comes as talk heats up that a decision by the NSW Independent Liquor & Gaming Authority on the application by James Packer's Crown Casino to increase its stake in NSW rival Echo Entertainment is imminent.
To cap it off, major Echo Entertainment investors have been agitating the board and management for a fresh application to the NSW government for an extension to its exclusive NSW licence beyond 2019. It is difficult to imagine that the Echo board would not be considering the merits of such a move.
If either Echo and/or an international player proceed to contest the NSW market, the chess pieces move in the casino game. At the very least Crown might find itself with some competition.
However, it will be incumbent on the O'Farrell government to consider all proposals. To date the awarding of a second casino licence has not been put to tender. In a sense it has been a moot point because there were no other contenders.
The NSW government is nearing the end of stage two of a three-stage process to approve Crown's application to build a casino and hotel complex on the Sydney CBD foreshore site Barangaroo.
It is believed the independent panel, chaired by former Commonwealth Bank chief executive and Future Fund chairman David Murray, is well advanced in its work. The panel was established by the state government to consider the merits of awarding Crown a second licence in NSW after 2019.
Plenty of issues will have crystallised and decisions been made in the NSW casino market in the near future. In the first instance Packer will probably get a green light to increase his stake in Echo Entertainment from 10 per cent to 25 per cent. Whether he chooses to do so is unclear.
(A separate request by another 10 per cent shareholder in Echo, Genting, will probably also soon get approval to increase its holding.)
Crown could abandon its plan to enter the Sydney casino market by piggybacking on Echo's NSW licence.
(It previously failed to get Echo board seats.)
But to date Crown has retained the 10 per cent stake, despite the fact that Packer has pushed ahead with the plan to develop the Barangaroo site.
The odds-on bet is that Murray's team will come down in favour of the Packer proposal to build a casino at Barangaroo and this will smooth the way for its ultimate approval by the NSW Government.
The terms of reference for Murray's panel do not involve weighing up Crown's proposal against another.
It needs to place a value for the state on the future tax and tourism benefits and offset this against the social costs of more gambling facilities. It will need to assess how much of the gaming custom will come from offshore and how much will be cannibalised from Star or from Packer's Crown operations in Melbourne.
But if Echo seeks to buy a fresh period of licence exclusivity it will come at a cost. The 12-year exclusive deal under which it operates cost $100 million plus the impost of paying a 50 per cent marginal tax rate.
The Barangaroo proposal has the bonus of the construction of a six-star hotel, which would not be viable without a casino attached, and it does not include an application for the socially undesirable poker machines.
Echo has been canvassing the idea of adding a more integrated resort to its existing facilities - referencing the Marina Bay Sands complex in Singapore.
Over the past couple of years it has invested about $900 million into its Sydney Star casino facility in order to capture a greater share of the VIP market.
Its most recent financial statements suggest it has made some progress in increasing its market share, but investors are concerned that if the NSW market is opened to competition it will ultimately lose share.
Clearly Echo shareholders want to improve long-term returns from the capital investment at the Star.
After a painful overhaul of the management and board, investors now feel that the company should be more proactive.
The Packer camp has undertaken an impressive lobbying campaign focused on both sides of the NSW government and Echo has been equally impressive in the mismanagement of government relationships.
Chairman John O'Neill is a long-time networker in government and sport circles but new chief executive John Redmond is an experienced operational manager from the US.