GREY:ROAOF - Post by User
Comment by
dhparon Jun 25, 2007 4:42pm
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Post# 12995892
RE: higher extraction costs coming
RE: higher extraction costs comingyou did not get my point.
What I meant is that if Art stops Oilexco's business altogether right NOW, pays debt (partly with cash on hand) and pays other fixed costs and lends both rigs + Sevan to some other company at market price they get an annuity accruing about $500k/day for 3 years, i.e. about $500m NPV... with 3Y of Brenda at 20k bopd average and prices around $60 with 80% netback (you could hedge it even better) that's another $1B, i.e. $1.5B - pretty good for sitting at home and watching TV. That represents 7 loonies a share already - doing nothing! It is pretty wild calculation but illustrates the point.
And only now add Oilexco's business, i.e. your favorite reserves, experienced team, franchise, projects etc....