RE:RE:darned if they do.....darned if they don't!!!Ferret
It's in the detail my friend. Easier to post a comma delimited file (see below) than a picture of the back of my envelope ;-)
My conditions were $100 oil and <$25m cap ex per year. Result - payback in just under 5 years.(look at the net line)
Debeaude's was Current prices ($114). Putting that into my spreadsheet. Result - payback in just over 3 years.
My assumptions: 5% interest on note; 2500 boepd first year and 2800 boepd subsequent years. Pick your oil price and insert!
If oil industry paybacks are calculated in some other way to produce a different result pls let me know.
,$100,Year 1,Year 2,Year 3,Year 4,Year 5
,Carry Cost,170,141,103,62,20
,Cap Ex,25,25,25,25,25
,Interest 5%,10,8,6,4,2
,,205,174,134,91,47
$30 cost,Operating cash,64,71.5,71.5,71.5,71.5
,Net,141,103,62,20,-25
,,,,,,
,,2500 boepd,2800 boepd,2800 boepd,2800 boepd,2800 boepd
,,,,,,
,,,,,,
,$114,Year 1,Year 2,Year 3,Year 4,Year 5
,Carry Cost,170,128,75,19,-39
,Cap Ex,25,25,25,25,25
,Interest 5%,10,7.6,5,2.2,0
,,205,161,105,47,-14
$30 cost,Operating cash,76.6,85.8,85.8,85.8,95.8
,Net,128,75,19,-39,-110
,,,,,,
,,2500 boepd,2800 boepd,2800 boepd,2800 boepd,2800 boepd