What is Net effect of derivatives There doesn’t seem to be any point in fussing about small moves in WTI …
Roughly speaking, cash flow doesn’t seem to change as much as one would expect.
State of derivatives end Q3 as reported
2016 43,249 bbl oil swaps @$83.01
2017 13,727 bbl oil swaps @$80.62
2018 8,810 bbl oil swaps @$79.71
Assuming no change
Assume derivatives cost 6% (I put in a 6% reduction)
| Crude Derivatives | Assume average >>>> | $30.00 | WTI | |
| Price less 6% | Year | Daily BBL | Total BBL | Gain less 6% | Net less 6% cost | |
| $78.03 | 2016 | 43,249 | 15,569,640 | $48.03 | $747,800,467 | |
| $75.78 | 2017 | 13,727 | 4,941,720 | $45.78 | $226,245,778 | |
| $74.93 | 2018 | 8,810 | 2,378,700 | $44.93 | $106,868,806 | |
| | | | Avg Gain | $46.25 | | |
| | | | | | | |
| Netback | | Avg for 2016 | Total BBL | . % hedged | Net | |
| $15.00 | 2016 | 150,000 | 54,000,000 | 28.8% | $810,000,000 | |
| $20.02 | | Incl hedges | 22,890,060 | 42.4% | $1,080,915,052 | |
| $35.02 | | | | FY Cashflow | $1,890,925,052 | |
| Crude Derivatives | Assume average >>>> | $40.00 | WTI | |
| Price less 6% | Year | Daily BBL | Total BBL | Gain less 6% | Net less 6% cost | |
| $78.03 | 2016 | 43,249 | 15,569,640 | $38.03 | $592,104,067 | |
| $75.78 | 2017 | 13,727 | 4,941,720 | $35.78 | $176,828,578 | |
| $74.93 | 2018 | 8,810 | 2,378,700 | $34.93 | $83,081,806 | |
| | | | Avg Gain | $36.25 | | |
| | | | | | | |
| Netback | | Avg for 2016 | Total BBL | . % hedged | Net | |
| $20.00 | 2016 | 150,000 | 54,000,000 | 28.8% | $1,080,000,000 | |
| $15.78 | | Incl hedges | 22,890,060 | 42.4% | $852,014,452 | |
| $35.78 | | | | FY Cashflow | $1,932,014,452 | |
| Crude Derivatives | Assume average >>>> | $50.00 | WTI | |
| Price less 6% | Year | Daily BBL | Total BBL | Gain less 6% | Net less 6% cost | |
| $78.03 | 2016 | 43,249 | 15,569,640 | $28.03 | $436,407,667 | |
| $75.78 | 2017 | 13,727 | 4,941,720 | $25.78 | $127,411,378 | |
| $74.93 | 2018 | 8,810 | 2,378,700 | $24.93 | $59,294,806 | |
| | | | Avg Gain | $26.25 | | |
| | | | | | | |
| Netback | | Avg for 2016 | Total BBL | . % hedged | Net | |
| $25.00 | 2016 | 150,000 | 54,000,000 | 28.8% | $1,350,000,000 | |
| $11.54 | | Incl hedges | 22,890,060 | 42.4% | $623,113,852 | |
| $36.54 | | | | FY Cashflow | $1,973,113,852 | |