Post by
westcoast1000 on Oct 21, 2014 10:14pm
Gas reserve value to a major
Greetings, all,
As we know from previous posts and news releases, the Argentine government has announced a large price increase for delivered new gas production from major producers. As I recall it will be $7.50 US per GJ/mcf instead of the current price of around $2.75. In effect, that means the RPT gas reserves (P1 and P2 and up) are worth much more to a major than to RPT at this point in time. It is possible the price increase may be extended to junior companies, but given RPT is trying to pursue its strategic directions in the corporate update, a sale or trade with a major may well be possible. That means with good negotiation RPT should be able to capture some of the additional value of reserves in anything RPT gets back from a major partner.
WC
Comment by
2j3kl on Oct 22, 2014 7:52am
This post has been removed in accordance with Community Policy
Comment by
TheRock07 on Oct 22, 2014 9:00am
2013 reserve estimates assumed $4.04 US. At $7.50 gas, the 2P reserves would baloon upwards to about $7 US per share. Contractual gas processing returns ( to 2018 ) boost the NAV by $0.21 per share each year, independent of their gas production. The share price is detached from reality at present. Value always emerges. It will here too..
Comment by
groundpounder2 on Oct 24, 2014 11:39am
Rock Can you explain your NAV of $.21 per share each year, independent of production. Are you saying in 5 years NAV is around $1.00 per share? cheers