Stock Analysis Sept 15, Issue 26, Vol 7 - I wish I could put the...

Stock Analysis Sept 15, Issue 26, Vol 7 - I wish I could put the PDF on Hot Copper - impressive with diagrams with a valuation matrix. BRU have an option to get 30% after a successful drill, they have to pay 90% of the drill cost to OBL. Possible to get $8 a share after the drilling.

This is why the stock is going up and will keep going up.

I have put the detail of the report below:

"Oil Basins has contracted the Hunt Rig and plans to drill its long

anticipated Backreef structure in the Canning Basin during October.

Oil Basin has received optimistic interpretations of this stratigraphic

trap from consultants who estimate that the prospect has potential

to hold 270 mmbbls of recoverable oil or 500 Bcf of gas in sands

which occur at a depth of around 1,500-1,700 metres. While

StockAnalysis believes such a target is optimistic, the seismic

evidence is sound and a $1.9 million (dry-hole) test is certainly

justified on the evidence.

Oil Basins has undertaken an underwritten 1:1 issue to raise over

$5 million, which will fund its commitment to 100% of drilling costs.

Dry hole costs are estimated at about $1.9 million with a further

$0.4 million required for testing and completion if hydrocarbons are

present. OBL will be carrying quirky company Backreef Oil, led by

leading anthropogenic climate change sceptic, David Archibald for

10%. If the well proves to be a discovery, Buru is most likely to

exercise an option to buy a 30% interest in the project by refunding

Oil Basins for 90% of its drilling costs.

A well to 1,800 metres is planned and scheduled to take 9 days to reach total depth.

Large sediment fans are interpreted to lie east of the Blina oilfield and seismic

interpretation supports the theory with possible direct hydrocarbon indicators seen.



Big seismic line map



StockAnalysis assesses a discovery at 10% of the estimated P50 prospect, which would

be 27 mmbbls of oil or 50 Bcf of gas, valuing the oil with a net present value of $18 per

barrel and gas at 45 cents per Mcf.

Discovery of oil at this size is estimated to be worth 56 cps to Buru and 81 cps for Oil

Basins retained 60% interest. A discovery of the size that OBLs consultants have

targeted would be worth over $8 per share to OBL and $5.65 per share to Buru, but

StockAnalysis is not predicting this sort of an outcome.

Conservatively, each well in such a target might have potential to recover about 1

million barrels of oil, if hydrocarbons were present".