Yangarra Resources Ltd T.YGR

YGR Decline Rate

[Helloworld]

Kav or Cliff do either of you have enough info to say whether the YGR decline rate in their presentation is accurate. Based on Y1 of 308 bpd, Y2 of ~150 bpd, Y3 of ~110 bpd, Y4 of ~80 bpd, and Y5 of ~70 bpd, it would seem a 30 well per year should result in over 20k per year ultimate production. Does this seem likely?

[cfliesser]

I am no expert on this, kavern might know better.

[pennydredful]

When  your  drilling  for  oil  like YGR   high decline  is a good  thing  as  it means  you  are  getting  the product   out quickly  and can  recover   your costs   quickly  .  When  buying  production  high  decline is  not so good   if&

[fullyautomatic]

PE of 10 on Q1.. Haha yep never thought of it that way... Rig is back on the map at to finish the 14 well pad!!! LFG boys

[TheRexmember]

High decline rates are never a good thing. The higher the decline rate the less economic a project is. The more a company has to spend just to maintain production and the main reason this company fell out of favour for two years and debt got out of control when prices plunged. It was also why production type curves were lowered almost 25% and attracted a large short position to the company

[kavern23]

Pennydredful does make good points on decline rates. Decline rates were not as much of an issue as low intial well results for some wells in 2021 until they got the drilling program turned around in like Sept of 2021. A company has to manage the type of land that they have.   When oil prices are high, higer declining wells should be high graded and drilled.  And the lower intial

[pennydredful]

Nuttal   didn.t  believe   the reserve  numbers.   This   is  like  saying    YGR   pulled   the wool  over  the eyes  of     the  Engineering   company   (similar  to  an  Auditor)  that  prepared  the  Reserve 

[TheRexmember]

You are correct Penny - they did pull a fast one. It is why they restated the type curve - the decline rates were higher than stated in the reserve report.  By not addressing the reserves until this year it probably helped to avoid cutting the credit line when prices were low.  That is where the opportunity comes in though. As Kavern mentioned payback is crazy fast. High prices really