RECO 8,500,000 acres * $ 850/acre = $ 7.2 billion ($55/sh)The value of an acre of land that has oil and gas shows is: $ 850 per acre per company presentation.
RECO has 8,500,000 acres which deepens in the basin towards Botswana, meaning oil.
Therefore value of RECO stock at this moment is: $ 7.2 Billion
(8,500,000 acres * $ 850 per acre).
Once it is determined that it is commerical oil, then the value of the acre is $ 4,000 each.
Once we produce it is $ 20,000 per acre.
That means fair value now is $ 55 per share.
When commerical, fair value is: $ 259 per share
When producing fair value is: $ 1,294 per share.
With ROE deal, both ROE and RECO have locked out the major oil companies whom will have to pay a HUGE PREMIUM to get a share of the pie and, a bidding war will ensue.
A major may want to buy RECO out at say $ 100 to $ 150 per share and, it will be hostile.
mpo