CGX VALUATION Just ran an updated valuation for Demerara, Makarapan-1 and Corentyne Kawa-1 with the following assumptions.
Oil price assumption US $5/boe.Historically, most third party analysts use $6.50 when Brent above $60/bbl).
Corentyne, Kawa-1:
- 500mmboe
- PoS 50%
- CGX Interest 66.667%
- UnRisked: US $1.67B; US $5.75/sh
- Risked: US $833M; US $2.87/sh
Demarara, Makarapan-1
- 1,500mmboe
- PoS 25%
- CGX Interest 66.667%
- UnRisked: US $5B, US $17.24/sh
- Risked: US $1.25B, US $4.31/sh
With US $200M in recovery our "risked" share price assessment for the first two exploration prospects is round US $8/sh with 66.6667% interest in both offshore licenses.
We will likely farm down prior to drilling and should receive reimbursement of prior costs, some form of exploration and development carry, along with a royalty. As a conservative assessment - just divide above numbers by half - that's a ball park figure valuation of the first two prospects.
Its amazing and simply unheard of a company the size of CGX drilling two wells in 12 months wherein both would likely be ranked as "industries top 10 exploration wells to watch". Perhaps the Demarara prospect being listed as number 1!
Both wells will take place in the hottest and most prolific offshore basin in the world.
Bottom line - the share price is undervalued! Just wait a few weeks - analysts are going to be all over this.