Canadian Oil & Gas Companies Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Canadian Oil & Gas Companies

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Goldberry who wrote (8562)	11/28/2001 6:54:30 PM
From: Richard Saunders	Read Replies (1) of 24921

Graham - further to what Stan indicated. The production is gas weighted & the per flowing number that Stan mentioned is based on a 6mcf/1 barrel conversion. It wasn't too long ago when conversions were being done at 10:1 On a 10:1 basis the price of production using ESTIMATED production for 2002 is just under $53,000 per daily barrel of production....... A swack of the reserves - 85% area? - purchased are classed as proven. There is a difference between proved reserves which aren't yet producing and proven producing reserves. Without looking at the engineered report it's impossible to say how much capital spending will be required to turn in-the-ground-reserves to cashflow generated from production. Also, I noticed the McDaniels mention also indicated the production assumptions for 2002 to be ESTIMATED. Generalizing however McDaniels is a reputable firm and I believe tends to estimate on the conservative side of the page however keep in mind that engineered reserves are ESTIMATES. Sometimes there's a difference between estimates today for stuff that is assumed for the future vs the reality that actually happens.......... A good example? Watch for annual reports that start to appear next spring and see what general ceiling tests for previously estimated reserves start to translate into based on Dec.31, 2001 commodity prices vs. estimates being made for the same a year ago. Write downs for many balance sheets coming soon to oil and gas companies near you....... It has started already. EEE Cdn88 wrote down $245mil. recently, Anadarko did some of the same a while earlier and more companies will be doing it too. Interesting days ahead, especially if some of the banker types start getting involved in situations that may be riding with aggressive debt, etc. Stay tuned.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next