RE: $65,000/boepd !!!
Absurd , absurd , absurd for so much oil. Nobody reads any more, nobody makes calculations.
FFO is almost $30M annually and this gives cash for minimum 10 NEW wells as the cost per well is $2M for SCS (40% WI).
1) Assuming IP-30 550 boepd, this gives a 5500 boepd gross which is NEW 2,200 boepd NET for SCS in 2013.........
2) EXCLUDING the waterflood improvement from the EXISTING wells that DOUBLES the production on average.
3) EXCLUDING the 150+80 boepd that will be added into production in Q4
The Company suspended approximately 80 boe/d of production of low netback natural gas weighted production in the second and third quarters and does not expect to re-start this production until natural gas prices recover further. In addition, the Company had 150 boe/d of oil weighted production curtailed in the quarter due to maximum rate limitations on wells located in Judy Creek in the Beaverhill Lake and Pekisko formations. The Company expects these curtailments to ease over the next 12 months as the Company expands its Pekisko waterflood and further develops its Beaverhill Lake pool.
4) EXCLUDING the NEW wells which were added at the begginning of Q4 2012. I quote:
At the end of the quarter, Second Wave had 3.0 gross (1.2 net) wells waiting to be tied in or completed. Subsequent to the quarter end 2.0 gross (0.8 net) of those wells were tied in and placed on production, leaving an inventory of 1.0 gross (0.4 net) well currently standing waiting on completion operations.
5) Waterflood has worked for ALL the neighbors of SCS thus far....look at today's news from PRY.V (pinecrest), the first results from ARN.V (Arcan), Legacy (LEG.TO) Q3 report, etc. etc.
Why would not it work for BHL ?
Look at the IP of the wells in BHL....they hit over 2,000 boepd like they drill in SAUDI ARABIA.
SCS owns the SWEET SPOT of BHL and it is repeatedly obvious.