RE:RE:RE:RE:Next steps for RPT? What are the values of the alternativesYour point would be true if they sell at our estimated prices.
But their average is around there with recent insider buys.
Also, they will probably decide to develop which is where the bigger money is.
Lets take offshore FV with its 7 million boe of 2P.
They need 20 MMCFPD to get the $7.50 premium gas price ( about $50 per barrel incliuding liquids ).
The average well produces about 11MMCFPD, so with 3 wells , they would easily qualify.
Taking their adjusted numbers of 2P ( at least 14 million boe ) @ $50 US per boe, the gross revenue from RPTs FV offshore field would be about $700 million US over the real RLI of the field( $50 X 14 MMBOE ).
Remove $60 million of capex for the cost of drilling 3 wells and another $60 million of sustaining capex during the RLI period and we have $540 million US.
Typically, operating costs are about 50 % of net gross, which results in cash flows of about $270 million over the life of the FV field.
RLI would probably be close to the average of 8 years which is about $35 million per year in average cash flows.
A JV at 50 % and fully carried for well drilling capex and RPTs accrued share would be about $135 Million US or about $17 million US per year.
6 times that, and the fair net value to RPT would be about $110 million US ( 6 X $17 m ).
Thats the risk/reward estimate, undiscounted.
Its my impression that they will rework some wells this year.
Beyond that, there are a variety of options, already specced.
But, its appearing that they now have their driveway ploughed.