IMO the market value of the 3 Senegal blocks is a lot more than...

IMO the market value of the 3 Senegal blocks is a lot more than what’s on the table at present ($4.5 mill plus a $65 mill free carry for the first well)

Comparative FAR/Senegal value projection using FAR's recent Biebu Gulf sale in China:

FAR have will receive $10 mill US for their 2.5% China Biebu Gulf stake with approx 80 mill barrels in reserves if it produces more than 1 million barrels in the future.
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If my maths are correct a 90% Senegal stake is 36 times more than FAR's 2.5% stake in China.

Now Senegal offers 1 Bill+ barrels. I billion barrels divided by 80 mill barrels is approx 12.5 times more oil in Senegal than in Biebu Gulf.

> FAR's projected value based on 90% Senegal stake based on recent China sale:

$10 mill US multiplied by 36 multiplied by 12.5 = $4.5 Billion US (Potential value of the 3 blocks)

> FAR's projected value based on 20% Senegal stake (Shell take up option):

20% Stake (8 times multiple based on FAR's 2.5% China stake)

$10 mill US multiplied by 8 multiplied by 12.5 = $1 Billion US
or $1.266 Billion in aussie dollars

FAR projected Share Price based on approx 800 mill shares including options/convertible notes if exercised/converted

$1,266,000,0000 divided by 800,000,000 = $1.60 per share (approx)

Note: It's late & I've done these calculations on approx figures, so all corrections gratefully accepted.

> A $1.60 FAR share price would make a lot of us extremely happy based on 1 bill barrels found.

> $0.80 share price on 500 mill barrels is still a great result

> Now 1 bill+ barrels found & share price with 20% stake is heading well above $2.00.

These projections are based on FAR's recent Biebu Gulf sale which was brokered with oil at approx $50 barrel & in much tougher economic conditions. The $10 mill US sale price realised for Biebu Gulf would have been potentially much higher if oil was back up over $100 a barrel as forecast by many in the near future.

I realise the cost of drilling & production is much higher in Senegal than in Biebu Gulf China but we cannot rule out the possibility that Senegal may offer multiple billions of barrels of oil in areas not yet surveyed given the large reserves found off the West African Shelf. The vast amount of past data & leading oil specialists in the field have predicted this over the last 50 years.

If the 10 mill US sale price for Beibu Gulf had been much higher this would have had a huge impact on the above calculations. E.g. a $15 mill US China sale price increases the above projections by another 50% taking the 90% value of the 3 blocks to 6.75 Billion US & FAR’s 20 stake to 1.89 Mill Au or $2.36 per share if 1 bill barrels of oil found.

First time I’ve extrapolated some potential price values using a recent comparative sale. (Real world prices). Found the results pleasantly surprising assuming my maths have not let me down. I can handle the embarrassment if I’m way off & look forward to any input.

Hope this is helpful in determining the potential value of these 3 blocks & FAR. Look forward to other opinions & reasoning.

Please DYOR