RE: RE: That's enough for me! How do you figure that 4,000 Boe/d can be kept flat with $20-25 million in capex?
Think about it this way: Given the high decline nature of Arcan's Swan Hills asset base, corporate decline is now around 30% or higher per year. Let's assume 30%
4,000*0.30 = 1,200 Boe/d that needs to be replaced in order to keep production flat.
With spending of $22.5 million, that implies a capital efficiency of $22.5 million / 1,200 = ~$19,000/Boe/d. Find me an oil-weighted producer that can add light oil production at that capital efficiency and I will find the financing to go in business with you.
Maintenance capital is probably more in line with a capital efficiency of $40,000/Boe/d, so ~$50 MM, just to keep flat.