RE:RE:How Close is Parex to Exhausting Reserve Growth?ROIcrusader wrote: There's really no way to tell if they have or not... unless you can tell us what's under the ground in Columbia. I originally bought PXT for two reasons: high netbacks, and huge acreage and have been a shareholder for a number of years.
PXT typically finds and expands pools by drilling out their acreage, and I assure you they are not even close to working through their acres. Take a look at their corporate presentation, there's a slide on the number of acres in each block and what/how many wells are operating in that block (we're talking blocks of 100,000+ acres - that's 156 sections of land)
Fully developing their properties would cost billions, yes, with a b... I see no time horizon on PXT running out of drill targets.
Thank you for this first response. It is very hard to tell anything from a map. Large sections of the property might be inaccessible, or have poorer geology, and the map is not going to give the nuance of that.
There must be some way to understand the scale of their properties. Don't they have any published estimate of 3P + Contingent + Prospective resources?
Let's do a quick math exercise. If they start 2015 with 2P reserves around 66K Mboe and grow these at 50% per year (I am NOT saying they are going to do that in this lower oil price environment, but let's use historical growth as an example). At end of five years, you have a company with 500K Mboe of 2P reserves. It's starting to look serious.
Just as a test of the outer limits, what is the proof that these properties can support 500K Mboe of actual 2P reserves? In the best case, whatever facts we find should support some actual theoretical upper limit, so we can know approximately where growth might stop (absent more acquisitions).
I have a financial model for PXT that I would like to share with you and discuss. Can you contact me at persistentone AT spamarrest.com and let me know here when you send that so I can check spam folder.