OOO .................. I have done a lot of research on M&A activity trying to fathom the premium a TO company will place on the SP and found that rather, in a TO situation, considering the SP consider the TO as a reserve replacement.
E&Y now seem to do annual reports on the previous years M&A and they definitely don't look at a TO as a premium of the SP but rather how much the companies 'Proven Reserve' was valued at (note here EY also rate unproven reserves) as 'Reserve Replacement'
There are a few problems in looking at these as the companies are only required to report reserves as boe but EY do look at the M&A that are weighted more to each gas or oil, the last report I looked at (2014) listed the oil weighted M&A at ~$US13boo but it does vary from a low of round $11-12 to a high of >$20, thus take a low figure of ~$12 up to ~$20, I guess it depends how desperate the TO company is to replace their reserves (note here that Shell has just terminated the Arctic exploration at a cost of $US7b and found didly squat, this tells us just how valuable a proven reserve can be considered)
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