RE: RE: RoyaltyOut of 9 previous drills, there was one pocket that initially produced an apparent 4875 bbls/d. Any others have been
disclosed as significantly declining after 1 day and determined non commercial prospect.
What was the gas to oil ratio, how viscous was this oil, how long did it produce and did it also fall off ? Leaving a known producer for 75 years doesn't make much sense, does it ?
Anyway, a 40% royalty off the top is not good when compared to their peers. What is their corporate tax rate ?
Even if it's only 30%, what are you left with ?
What you really have here, is a geological risk of finding hydrocarbons, a risk of finding commercial quantity of
only oil and a risk of development. Multiply them together and you've got less than a 10% chance of this well leading to commercial development.
The well won't be spud until summer, there will be months before any significant data is released. You're pumping now for the short term gain, using long term potential. I've seen this happen for years, check it out. I've already proven multiple handles on the VST board, in fact, the same handles that worked the Oilexco board.