Hi cmonAnswering your questions - yes, the gas was expected. It...

Hi cmon

Answering your questions - yes, the gas was expected. It was estimated to be 20 mmcfgpd (see page 3 of the May 2020 investor presentation).

The 19.4 mmcfgpd is the initial flow rate. How this flow rate goes over the year is beyond my understanding.

The current gas price is US$2.58 per MMBtu, that is $2.58 per every one million British thermal units contained in the gas. With 1 cubic foot of natural gas having 1037 Btu then 19.4 mmcfgpd is equal to 20,118 MMBtu (per day) or $51,904 per day. Over a year this would be around $18.4m assuming the platform is shut down for around 10 days for hurricanes, maintenance etc and of course, the well continues to flow gas at this rate. Also G1 initial flow rate for oil was 375 barrels per day so at a oil price of around $42 you would need to add another $5.5m pa. So in 12 months time G1 would earn gross revenue for Byron of around $24m. Sounds great, but then you would need to deduct royalties, cost of production, transport costs etc to arrive at a net figure that could be used to pay for further wells at around $11m a pop.

BTW, I note the May investor presentation talks about net oil production but within this appears to include gas. This could be made clearer.

Finally, I always enjoy examining your analysis so thank you for being one of the few brave enough to put it out there.