May I say congrats to all on getting a JV. This would certainly be welcome news wouldn't it. Shouldn't it?
Ah but what would an AKK release be without a fair amount of obfuscation. Details, the devil is always in the details omitted by AKK. That is the beauty of publicly available information.
My question would be on the actual structure of the carry - as we are led to believe that with these conventional wells that do not require fracturing that the bulk of the well costs are in the actual drilling. I've seen companies note the "Drilling Cost" for wells in the DJ-Basin at around $97/ft. Call it $100/ft and i f Pierre wells are 4,000 feet the drill cost is $400K. I'd be more interested in seeing what a typical AFE cost is for a Pierre well and what exactly Pierre Energy Partners is paying for and what AKK is paying for.
I'd also like to know who Pierre Energy Partners are.
Now here is something just as important. AKK and its JV partner make money when they discover and produce oil. AKK has continuously referenced the field next door (Florence) and Comet Ridge and how the best well has produced over 180,000 barrels and is still producing.
That well is an outlier. AKK doesn't tell you that 15 wells produced less than 20,000 Bbls and that the median well production is 16,463 Bbls. Now correct me if I'm wrong here but at $50 oil and producing 20,000 Bbls, GROSS REVENUE is just $1M. Yes that certainly is high impact but not the kind you what.
Since its public data here is the data for you and some charts to look at for easy visualisation. The data is presented sorted by cumulative production (2000 -2015 (Jan)).
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