ARPETROL LTD V.RPT

What we have h

[TheRock07]

Let's summarize the asset base 

1...gas processing plant
Annual gross of $9.5 million in fees , cash flowing $5.5 million.
Plant has operational life of at least 20 more years.
Gas prices are increasing , so future cash flows should continue to increase.

Valuation..... $25 to $30 million at 5 to 6 times cash flows

2....... Current production
220 boepd generating $2.5 million in sales and $0.5 million in cash flows.
Valuation..... $3 million at 6 times cash flow

3......Faro Virgenes 2P reserves of 6.9 Mmboe 

10 % discount NPV of $115 million US if internally developed.
$55 million if sold outright

4...Faro Virgenes Tertiary Reserves

Estimated to contain 100 million boe valued at discounted value of about $70 million by Raymond Janes

5......Canodon Luck block

Estimated recoverable prospective reserves of 4 million boe valued at about $30 million 

6......Vaca Muerta Shale oil blocks

????????!!!

Valuation perspective

The highly profitable gas processing plant is easily worth $25 million.
Current production adds another $5 million.

These are hard monetizable assets that could easily be sold for combined value of $30 million.The remaining assets esp the superb F  Virgenes 2P reserves with huge exploration upside are the company makers

The other two assets could be quite valuable but cannot yet be quantified.

Current market cap of $12.5 million is well below the $30 million of its current cash flowing assets

Management took a substantial chunk of the 2011 financing at 13 cents a share... About $3.25 in post consol

Conclusion...., Very undervalued and moving above $1 in the short term and development of FV could see the former target of. $7,50 achieved

[DocPat]

I agree with you entirely ROCK .. This company is vastly under valued and even at fair value today has enormous potential .. $7.50 definitely in reach .. maybe more .. IMHO Doc.