Net tangible assets per share - AUD$0.08 Share Price - AUD$0.054
We are trading well under the tangible value of the business.
1P+2P+3P oil reserves total 58 MMbbls with a probable average share price of US$65 per barrel over the years to come. 58x65 = $US3.7Billion of oil in the ground. If we take a conservative ROE figure of 5% we can expect to extract US$175Million in profit over the life of the field.
Ryder Scott analysis of a year end independent mid case scenario totals of 149MMbbls of oil. 149x65 = US$9,685Million. If we take the same conservative value of 5% ROE we have a return of US$484Million over the life of the project.
According to the TMS chart ATS is on average producing 80,000 barrels of oil per well drilled, well over the average of 30,000 barrels per year of other producers.
If we take a conservative approach and expect 30,000 barrels per year for each ATS well drilled we will have US$1.9Million per year of revenue from each well. With an expected worst case scenario of US$12Million per well. Expected well drill cost will reduce with large scale operation efficiencies.
Market cap of ATS is AUD$62Million and is the largest holder of the TMS with over 100,000 acres of a total 14 million. Proven economical value of the field has been proven at hedged US$54 per barrel with a PE of 2.62.
Out of 43.8 Billion barrels of proved oil in the US, ATS holds 0.1% of the total amount. This warrants a much higher market cap.
Regards Al
ATS Price at posting:
5.4¢ Sentiment: Buy Disclosure: Held
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