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Zargon Oil & Gas Ltd ZARFF

Zargon Oil & Gas Ltd is a producer of oil and gas. It is engaged in the exploration, development, and production of oil and natural gas in Canada and the United States. The company works on three phases of oil reservoir exploitation which include Primary recovery, Waterflood recovery, and Tertiary recovery. Its portfolio includes Alberta plains north, Alberta plains south and Williston basin projects.


GREY:ZARFF - Post by User

Comment by PetroExploreron Dec 10, 2018 9:29pm
88 Views
Post# 29094881

RE:PetroExplorer, facts about PSH's deal in ND & ZAR's ND asset

RE:PetroExplorer, facts about PSH's deal in ND & ZAR's ND assetYou are comparing apples and oranges, but I'll give you some partial credit, in that $40,000/boepd might be attainable.  Looking at the reserves, and taking a 10%NPV value, we would get $17.75 million on Total Proved.  I believe they are stating around 409 boepd for Q3, so that works out to $43,400/boepd.  Still a bit under your estimate, but plausible.

I have compared both presentations: PSH is buying land that is 55 miles from Zargon's properties, that is in the heart of the Bakken.  There are numerous horizontal wells, surrounding the PSH lands, and nothing surrounding Zargon's lands.  Zargon doesn't appear to have Bakken wells, but there could be some minor potential.  They appear to be in a poorer quality part of the Williston Basin.

So you can't compare the amount paid by one company, for prime acreage in the heart of the Bakken, with some scabbier lands held by Zargon.  But looking at last year's yearend reserves, we are in the ball-park, at around $40,000 boepd.

Your estimate of $65,000/boepd, is just too high, based on the different quality of the two assets.

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