Banter and General Comments .. BRK, page-11068

Hi mate

Thanks for asking a " critical " question.

Firstly, all wells will be horizontals.

BRK have guided from their reserve report , that their share of drilling the 20 wells the report is based on , will be ~US$151.8 million.




BRK guided their share of the 4 wells to be drilled in the FMDP would be ~US$26 million.

They also guided that the FMDP would produce 715,000 BOE net to BRK in the first 12 months of production.






Extrapolation well productivity is a little challenging as cant really use the FMDP as a guide . The 4 wells will have ~30,000 feet of lateral coverage ( 2 x 10,000ft + 2x 5000 ft) , 50% of which is Sycamore and 50% is Woodford. We don't have a breakup of how much of the 715,000 BOE is Sycamore vs Woodford but it will be more than 50% being the more productive zone. As no other development will have such a high % of the Sycamore it would be inaccurate to extrapolate the FMDP.

I would have to go through all the Courbet well records up to now, plus the Gapstow , and the 4 BRK wells to calculate the production per lateral foot and average that across the Sycamore wells and Woodford wells separately, then extrapolate that over the expected BRK development wells. I can do that but it will take a while.

One thing I will extrapolate, is the 12 month FMDP cashflow, using the last BRK presentation as a guide.



If we assume todays prices of US$ 72 per barrel oil, and current gas, NGL prices, the net margin per BOE is closer to US$ 35.

Using that as a guide, the 715,000 BOE 12 months production will produce ~US$ 25 million net cash flow, or a payback in ~12 months. At US$ 40, it will produce US$ 28.6 million cashflow in 12 months, with less than a 12 month payout.

I'll see what I can get from the other stuff, but it will take a while.

Cheers

Dan