RE:RE:Seeking alpha articleSumms it up well indeed.
"Note that 60% of Pipestone's land falls within the VRGC3 area and another 15% falls in the VRGC2 area which have demonstrated the best economics and thus, make up the majority of Pipestone's growth plans."
First time I hear VRGC3, 2 and 1. It´s explained well in the current company presentation (slide 8). Note that these are the type curves with 2,500 m lateral lenght. PIPE implemented 3,000 m laterals in its latest well, therefore an adjustement of +25% could be made to EUR.
So let´s estimate an EUR of 400 mbbl condensate per well no mater where it is on PIPE´s land package (VGRC1 is a bit lower but the smalles part). This sums up to 20,000,000 USD per well when we assume USD 50 WTI over its life time. And yes, 20 mm US Dollar, not CAN. Drill and complete costs PIPE 5 mm USD. Plus the midstream part, to bring the well on stream. Let´s assume 3-4 mm USD, maybe one has more accurate numbers. So overall it costs 8 mm USD to bring the well on stream vs. 20 mm USD worth of condensate producte over its life time. You have to work over the well after some time but this shouldn´t bring the costs above 10 mm USD.
You see were I´m going here. And this assumpting just includes the condensate production (and USD 50 WTI). PIPE also gets approx. 25% of its revenue from gas sales.
So make your own assumption how much worth PIPE really is.