maverick = no real future....lol..., page-34

todays digging reveals a real issue with depletion rates.
At no time has the company given any guideance on this issue so you can only look at data available.

While you can never be 100% without understanding each individual well enough wells have now been drilled to at least show a pattern.

What the data indicates is a big red flag to me.

In june 2011 BOPD were 688 from 24 wells with several of those wells not producing for the whole period
By Nov 2011 BOPD was 706 with number of wells 37
in march are saying ave 742 BOPD from 51 wells.


Their appears to be very significant depletion in these numbers.

Also (more red flags) they have changed their reporting on numbers to make this depletion appear less obvious.

Up until Nov gave monthly data. Now are only giving quarterly data which averages the 3 months. I am always suspicious when company's change the way they report data when that data appears to become less favorable.

Another statement I found was that in the Dec quarterly they said that 2012 BOPD had now stabilised at 900. If this was true what happened between end on jan and march for the average to get back to 742.

While they have lots of oil in the ground if depletion rates are high then this severly limits the actaul profit you can make from the field.

For example if depletion is 25% then if you can drill 100 wells a year then once you reach 400 all you do is spend the cost of 100 wells and produce the same amount. Not a very viable situation.

My conclusion remains that this stock remains overvalued. There is too much potential all ready priced in