Spud date and how to calculate SP Well is to be spud on Friday. This is a few days later than planned as the winter road was closed to repair damage. Over 600 heavy trucks where headed north and the road could not take it.
A very rough way to calculate share price is;
OOIP x Recovery Factor x $15/bbl
418 million shares (fully diluted)
OOIP is 10 billion bbls oil ( MGM: Jan 4th FP article as posted)
Recovery Factor (Rf) is 6%. Husky is getting 10% for its southern shale oil plays. Trilogy is getting 10 to 24% for Montenay shale oil.
$15/bbl is the value of a bbl in the ground based upon a NPV @10% constant prices for oil. You can check out TD Waterhouse on Crescent Point that the stock market is paying almost $40/bbl for their oil. The lower value for Canol oil reflects the higher capital cost, operating costs and the fact that the oil will not be on stream for a couple of years. This number has also been adjusted for the formation volume factor of 1.2.
Based upon that you can work out a range of values for the share price. Even at the lowest range, MGM is worth many multiples of it penny stock price.