inp getting slaughtered, page-24

re: valuation then between yarrow2 and ipo Ian, think you are being generous to Inp on a few fronts:-
1. Flax DST at 500 bbls a day, against a 5.2mmbl field-thats a bit high for the recoverability isn't it?,(ie the field is not that big?)
2. Due to the directorsrelated parties royalties you should not be using A$15 barrell for a reserve valuation, but a significant discount to that. With the royalties at 12.5% well head return, that is around a 30% NPI on current revenue/costs-drop the per barrel reserve rule of thumb back to A$11 (and that is being generous).
3. The Yarrow step out failure creates a whole new world of uncertainty depending on its reason for site selection. If it were a standard step out, ie non aggressive/opportunistic, the reserve reduction is actually a multiplier-it would not reduce the area for BCF collection by 20% say, but it actually is say 50% (I can diagrammatically show what I am getting at-perhaps it is best explained by the area of a circle, if you halve the radius you more than halve the total 'area!).
Conversely, if the the step out was very aggressive, it may have the opposite effect and only marginally reduce the reserve.
Besides its only gas anyway and they are still many many moons from having a contract to sell it-perhaps your value per BCF should also be discounted for time as well ?LOL
Be very careful playing with this stock.
Cheers, TAS