FAR-BPT

I am tending to look at the market cap going forward more so than the SP (Whisky you also seem to be in the same boat) as a ballpark estimate of where we could be closer to production. I have been trying to compare BPT to FAR, just very rough comparison.


BPT current MC of $1.2b at 65c, Before the oil collapse in 2014 they hit $1.80 plus, almost 3 times todays price.
Im not sure what has come to pass with the Drillsearch merger as far as dilution/MC is concerned so I dont know how much of a comparison from then to now SP wise this can be but Obviously the OP is the main reason for SP fall. It has to be said they are a very solid company and Reg has played a huge role with them in that, good to have him advising FAR going forward. This table illustrates the reductions across the board in its business.



They have currently ~$160M cash and $530M debt facility.
FY 16 production estimate of 8-8.6 MBOE of that oil is 3.9 - 4.3mb.
Their oil production keeps dropping, even though they stated for FY15 there was 100% reserves replacement so not sure what the deal is there.
Production of oil: 2014 - 5.2mb, 2015 - 4.6mb and as stated 2016 expected ~4.1mb
The gas is staying steady at 4.5Mboe.





Where FAR will have a huge win over BPT in the not too distant future is in oil reserves 2P, which I would expect to be attributed a certain price when declared 2P, depending on the oil price at any given time?
I expect 1BB plus for SNE so I'm giving FAR 150MB for its 13.7% (1.1Bb) but for now I will lowball it and say FAR get 100mb of 2P, this is still five times what BPT have.



I dont really know what value 2C reserves would be given in todays market, maybe someone else can comment on that? I think its fair to say it would be small in todays market and gaining more value as the OP rises but the 2P is where the money is at. If we even include the total oil and gas 2P on BPT portfolio we still will at a minimum I think have 50% more than them. Going through the monies received though its the oil that generates the big dollars over the gas. BPT 2P in 2014 was ~85mboe and that dropped to the above in 2015, not sure if that will drop again with the next final year results they report. This is also another positive for FAR compared to BPT because there is many big prospects that could again increase reserves substantially not to mention what will become of SNE/FAN when all is said and done.

So in summary on this very hungover day, as we become closer to production we will easily surpass the MC of BPT IMO. It won't be overnight riches that we all thought it may be but for the patient ones it will be profitable. The instos are loading up, its a no brainer. Buy into a premium asset where premium assets are becoming very rare at the bottom of the oil price cycle and its a fairly good bet you will get a better return on your money than a basket of bluechips. By the time we get to production the OP will be higher so the MC of BPT will probably be higher but FAR will be the company in a much better position. I expect us to have a MC of at least $1.5B closer to production and then the gravy of lots of other big prospects coming in also.

Disclaimer:
All of my estimates are being very cautious IMO, I think it will eventually become much better for the patient holders (as per Jubilee) than what I state but they are my estimates, take from that what you want but DYOR. Interested to hear/see others comparisons.