Tracer Petroleum (TCXXF) Message Board

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Gold/Mining/Energy : Tracer Petroleum (TCXXF)

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To: Peter G. Troyan who wrote (875)	12/11/1998 12:09:00 AM
From: Saracen	Read Replies (1) of 1261

You are forgetting about the $2 million work commitment. This works out to a total of $3 million for 80% of 400,000 barrels (= 320,000 barrels). (You can't count the probable or possible barrels, because you don't know until they are proven if they are going to turn into cash flow.) By my calculations, that works out to a total commitment, albeit in the future, of $9.38 per barrel. With oil prices under $11 per barrel, I do not see how Tracer can possibly make money on this. I guess they are hoping that the $2 million work commitment will turn some of the probable and possible into proved barrels.

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