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Gold/Mining/Energy : Oil Sands and Related Stocks
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To: Bearcatbob who wrote (1905)8/20/2005 6:10:57 PM
From: Taikun  Read Replies (1) of 25575
 
Bob

CLL (SAGD) is assuming 60% recoverable:
connacheroil.com

UTS (Fort Hills Mining) is also assuming 60%:
uts.ca

PBG claims THAI can get 80% recovery, but this has only been lab-tested and we are waiting for results of the pilot.

There is a cashflow analysis. You have to make assumptions:

1. Sell output to an upgrader, if capacity is available
2. Sell output as low API oil, like BVI, who don't reap very much reward
3. CLL builds upgrader

My NAV approach is for a takeover, and based on the numbers used on places like Rob TV, it seems $3.50-$3.30 (either 0.67 x recoverable or $1 x 3P) is the NAV used.

Remember even TOT didn't pay for the DCF of the DCE project at Joslyn Creek. If DCE had gone into production its shares would have gone much higher than what TOT paid, because TOT took on execution risk (ie billion dollar cost overruns). DCE was mining and SAGD.

BVI is also pre-production (SAGD) and appears to trade at approx 75% of NPV.

The market appears to be discounting CLL's NAV of $3.30-3.50 by approx 20%. I'll be surprised to see CLL trade over $2.75 short-term, which is why I believe the NAV approach is the best at present.

Did you read the RBC oil sands valuation report in the Yahoo Group? You may get more answers there. That report showed UTS's valuation of 0.21/bbl in the PCZ deal (all est recoverable, UTS is mining and SAGD) and the two Chinese deals at 0.45 (MEG, SAGD) and 0.14 (Synenco Mine & Upgrader)

If anyone has any comments that would be great.
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