birch npv, page-11

Well Plough - a good effort and glad to see another poster willing to give this stuff a go.

No criticism here but something to consider.

1. I follow your Opex cost reasoning but IMO it is low.

2. I think your looking at Birch with a "project view" (as I do) but you do still need to take some of the G&A cost into Opex.

3. This is "gotcha" though and IMO its really hard to model. Funding is about timing and linked to Reserves and production. I see your model has Free Cash Flow (as in +ve even after CapEx spent) but I sincerely doubt it would be in the 1st couple of years.

The financing flow (and interest costs) makes a big difference in the DCF expected, all things being equal (production as expected, price received, costs expected).


A 100 wells is pretty tight spacing - are we thinking that they'll go after the secondary plays? 60 wells would be roughly 80 acre spacing.