This may be what you are looking for ...
Repost:
Formula to estimate NAV for VST:
Oil in groung estimate X Recovery Factor X 37% = VST's share of Recovered oil
But how much is that worth? Well, according to Scotia Capital analysis , 148MM barrels is worth $15.96 a share to NIKO. Since Niko has 50 Million shares, that means that 148MM Barrels is worth $798,000,000.00. (50,000,000 X 15.96= 798,000,000.00)
That actually comes out to $5.39 per barrel. (798,000,000 / 148,000,000 = 5.39)
Anyways,letsdo the math for now much 148MM Barrels is worth to VST. It's verysimple, just divide 798,000,000 by 270,000,000 ... and you get $2.95 per share for every 148MM barrels of recovered oil.
To make things simple,lets just calculate how much per share we are worth per 100MM barrels -100/148 x 2.95 = $1.99 per share for VST per 100MM barrels of oil.
Ofcourse the big question is how much oil is down there and what's therecovery rate. This is where you get to plug in the numbers with theformula above ...
As an example, if oil in ground is 2.5 billionbarrels and the recovery rate is 50% and our share is 37%(2,500,000,000 x .5 x.37) then our NET share of this oil is 462,500,000barrels. As established earlier, every 100MM barrels is worth $1.99 pershare to VST, so just multiply 1.99 x 4.625 and VST NAV should be $9.20per share.
So it looks like we will need about 2.7 BILLIONbarrels of recovered oil for Vasts share price to go to $20.(2,700,000,000 X .37= 999,000,000 barrels for VST . $1.99 X 9.99 =$19.88)
That'sdo-able if we hit 4.5 Billion barrels with a 60%recovery rate... and a60% recovery rate is just about what Heritage islooking at for Miran:
- Miran West structure estimated oil-in-place of between 2.3 to 4.2 billion barrels
- Recovery factor expected to be between 50% to 70% due to the highly fractured nature of the reservoirs
The published estimated recovery rate for VST is 16.5%. This IMO is ridiculously low.
Thereis a poster here who will try to persuade you that this stock is worth17 cents per share and that this stock is very expensive at the currentprice. Technically he is right but this is a VENTURE stock(speculative) and has the possibility to go much higher. They aredrilling in KURDISTAN ... not Oregon! There's TONS of oil in Kurdistan... billions and BILLIONS of barrels.