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Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: upanddown who wrote (1190)	3/8/2001 12:29:02 PM
From: excardog	Respond to of 23153

John RD has never been know to make very good purchases from what I've read. Within the past couple years they've sold Louisiana assets to TMR and Canadian plus GOM assets to APA. Now they are offering to buy BRR for pretty big dough in my opinion. Don't get me wrong I think it's great for the sector just don't think Shell is all that shrewd. Only my 2 cents

To: upanddown who wrote (1190)	3/8/2001 12:41:08 PM
From: Think4Yourself	Respond to of 23153

Fadel Gheit on CNBC yesterday said that RD Shell botched this up badly by lowballing the bid. He thought the bankers who advised them were partly to blame. I agree with Excardog. Of all the large cap energy companies Shell has the least informed upper management. On several occasions in recent years the CEO has shoved his foot into his mouth up to the knee. His statements of record clearly demonstrate that he doesn't appear to understand the industry he is in.

To: upanddown who wrote (1190)	3/8/2001 1:31:56 PM
From: Telemarker	Respond to of 23153

Hi John. <<Anyone know how to value E&P's on this basis?>> I'll take a shot by explaining the way I do it. I simply use enterprise value, divided by the reserve base. Enerprise value = market cap of common plus long term debt and any preferred equity. I like to use only proven developed reserves, others may choose to include proved undeveloped. The calculation and its result can be done either on a boe or mcfe basis, using a 6:1 ratio. Most E&Ps are capitalized at a rate of $5/boe on the low side and $10+ on the high side. But, not all reserves are equal. Factors such as oil/gas composition, weight of oil, processing requirements of gas, distance to commercial market, etc. would theoretically be considered. Danwilson_Yorkshire posts extensively on the Yahoo! VPI board. He uses this method to rank companies in a database that he maintains and liberally shares this information on the board. That board is worth a visit, IMO. Perhaps this was all an oversimplification and thus really didn't answer your question. I'm sure there are others who understand this better than I. Would be happy to hear from them on this. Regards, TM