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Gold/Mining/Energy : KOB.TO - East Lost Hills & GSJB joint venture -- Ignore unavailable to you. Want to Upgrade?

To: Kerm Yerman who wrote (3829)	8/2/1999 7:27:00 AM
From: Bearcatbob	Read Replies (2) \| Respond to of 15703

Thread, please help me out. Assuming I want to buy more of this play - with some reasonable leverage -and I do not want one of the huge risk vehicles - KOB, PYR or HTP. Someone convince me why WML is not the best bet for this. WML has a high impact well - hopefully to be announced shortly with Shell at Slave Point. From what I can see the debt in relation to production numbers are similar to ELK and the current production is almost all gas and associated liquids. Also, with the recent financings they appear to be cashed up - at least for immediate needs ie any funds before results from ELH are available. Thanks, Bob

To: Kerm Yerman who wrote (3829)	8/2/1999 10:44:00 AM
From: Check	Respond to of 15703

Hi Kerm, the squids ate my previous response to you, so I'll be brief. <<Can anyone inform me how we got to the US$0.68 (CDN$1.00) number.>> CDN $1.00 in the ground is a number that I've been using based on some deals that were done in Canada at the time this play got hot. I added a small premium for lower transportation costs and the proximity to a premium market. The last time I was in Bakersfield, (May), longer term contract natural gas was going for around US $3.00. I bet it's higher now. So add in a few pennies for the condensate and you could be looking at operating netback of around US $ 2. We don't know anything about the size of the reservoir and production rates yet, so instead of getting into very complicated speculations and calculations, I find the 2/3 discount a safe and easy way to compare the players. By the way, I've seen some recent analyst reports valuing B.C. and Albert gas at CDN $1.00. I just like to be conservative. (SO what am I doing here??!! <GGG> CIO