OTCPK:ARNBF - Post by User
Post by
coorsmanon Jan 27, 2012 7:23am
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Post# 19456172
The Bottom Line
The Bottom Line The bottom line on ARN is simple.
Under waterflood, which all of Arcan's wells will have, they will on average produce 72,000 bbls of oil in the first year. Using netbacks of $60, which will be easily achievable now that all of the costly issues have been resolved, each well is fully paid for in one year. The wells will continue to produce at 100+ boed for years afterward, which is where the payoff lies. Once they drilled the 400+ potential wells, that would be 40,000 bbls of oil per day, or $2.4 MILLION per day of pure profit. That is $876 million per year, of pure profit. What is that worth to a company like CPG that needs ne oil to help pay its dividend?
Just give that some thought before you hit that sell button.