GREY:LSTMF - Post by User
Post by
JohnDDon Jan 09, 2015 6:21pm
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Post# 23304051
December Production Estimate
December Production Estimate
The company's exit guidance is 36-37k boed
My estimate for December production is 36,500 boe/d.
Here is how I come up with this estimate.
Average October production from latest corporate presentation is 36,300 boed
3Q report advises that they plan to drill 26 wells in the 4Q. I am going to assume with declining prices they reduced the number of wells to 21 or 7 wells per month.
At 3Q end, they had14 wells in inventory - that is drilled and ready for completion. 2 are for conventional Sask, which was sold.
I assume no change to the inventory at year end, which would make it 12 wells in inventory at year end. I think this is conservative.
Assume a corporate decline rate of 31%, which translates to an absolute decline of 939 boed/month.
If they drill and complete 7 wells per month - assume 150 boe/d/ well. Production adds from drilling 7 wells per month = 1,050 boe/d.
Net increase per month 1,050 - 940 = 110 boe/d. round down to 100 boed.
Estimated December production = 36,300 + 100 for each of Nov and Dec = 36,500 give or take 300 boed.
Based on the above numbers, it seems reasonable that the company should meet their exit production guidance. But then again you never know with this company.