New Thoughts from Seeking Alpha This morning on Seeking Alpha, a new case is made for HRT's possibility of success at Baobab, Murombe, and Moosehead. Here is the link - https://seekingalpha.com/article/1491092-hrt-participacoes-has-an-asymmetric-risk-reward-profile-part-4?source=email_rt_article_readmore
The illustration assumes a 50/50 chance of oil v. gas. You can check out the numbers and look at the oil scenario as follows:
Chance of oil success = 1 - ((1 - .26) x (1 - .118) x (1 - .125)) = 43%
Chance of Baobab P50 oil success = 26% x 0.5 = 13%
Chance of Murombe P50 oil success = 11.8% x 0.5 = 6%
Chance of Moosehead P50 oil success = 12.5% x 0.5 = 6%
Chance of Baobab, Murombe, or Moosehead P50 oil success = 23%
Chance of Murombe P10 oil success = 11.8% x 0.1 = 1%
Possible yearend outcomes - 23% chance $7; 6% chance $26; and 1% chance $71.
Risk only what you can lose.
GLTA