LGX Oil + Gas Inc ROAOF

RE: Brenda value, crude@$60, 40mm barrels

[KeithR39]

Hi good40, my personnal comments: "Haywood sees a return of $37/bbl, you are using $51" I'd like to see their breakdown. I use crude oil @$60 USD. "You are using 40mm bbls recoverable, Haywood says up to 25mm" They stick to the original reserves report from RML that was lowered by the assumption of individual holes with no connectivity at all. The coming production horizontal drilling can only add more. I assume that any admitted connectivity will increase dramatically this report. "Peak production will be 35k/d with an average for the year of 24k bbls/d net oil...Improving on these production levels will be difficult based on the 25-40% water cut." The declining rate is lowered with increasing reserves. I do assume the reserves to be higher than 25mm barrels, so my declining production rate is adjusted with my program. Basically, our point of view differ because of 2 points: - the price of crude oil - the real reserves data Time will tell.