Michael - so far you have given me nothing to show me AUT is overvalued?? just some irrelent garbage about CVN and ABC. CVN is mainly situated in AUS and THAILAND, the wells they are drilling are hit and miss just like the ones coming up with SUR. AUT has %100 success rate on 18 wells with massive flowrates and good decline rates.
AUT is due for a reserves upgrade soon not to mention the 60 wells being drilled this year. AUT has more than 3 times the acerage of TXN. A perfect example of why AUT commands a premium over its peers is TXN's recent delay with fraccing their TEAL well, this has resulted in TXN's SP being stagnent for a couple of weeks now, while AUT is still powering ahead and adding value to shareholders every week. Delays are only going to get worse as 2011 has the biggest budget for drilling/fraccing and exploration. AUT has 4 full time drill crews and 2 full time fraccing crews so you know what you are getting with AUT and you always know that every day they are adding value to the SP as they are always drilling and fraccing. More land aquistions will be coming up as well and as stated by our MD. Massive hedge against the rising oil price as well.
Its a bit hard to work out how many BOEPD AUT will be earing at the end of this year as their interests vary in each project, but im predicting between 10,000 and 15,000 BOEPD, on a conservative %20 interest and 750boepd ON 80 wells. This gives you 12,000boepd
12,000 boepd x 80 = $960,000 -%40 royalties = $576,000 a day
576,000 x 7 = $4,032,000 a week or $190,080,000 a year, on 330 days a year -36 days for mechanical issues. This is highly conservative as i am using $80oil and an average of 750boepd.
Dont get me wrong i think TXN is a great buy and thats why i hold.
Add to My Watchlist
What is My Watchlist?