GREY:WFREF - Post by User
Post by
bossuon Feb 21, 2015 1:38pm
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Post# 23451306
LRE Valuation
LRE ValuationJust yesterday Bonterra Energy was acquiring in Pembina Cardium from a senior oil and gas producer 1800 BOE /d for $ 172 million at a cost of $ 95 500 /flowing boe.Proved reserves at $ 17,44 /boe and P+P at $ 13.19 boe. Decline rate at 7%. Earlier during the year Enerplus has sold 1900 boe /d at a price tag of $ 182 million for $ 95 700 /flowing boe. This give us a ball park figure of LRE valuation.So it means that bases on a price per flowing boe we could take just 50 % per flowing boe for LRE and using say $ 48000 per flowing boe (rock bottom price) and we could give a ball park figure of LRE valuation. Assuming projected 2014 production of 33000 boe at $ 48 000 per boe less $ 700 million debt and 193 million shares we have a share price of $ 4,58. The'' key'' to improve LRE SP would be to sell ''some' none core boe and reduced their debt accordingly. Difficult task for the management but not impossible and I think they will have to do so.We might have some ''clue''in the years 2014 financial results coming in a couple of weeks.