Hi
@Hogesjzz30Please note the 40-100 million BOE is not what BRK have now, but what they potentially could have if they just repeated the process they have done up to now, after monetising their current 3 DSU's through production and PUD asset sales, and scaled up by a factor of 5-10 which the funds generated by the monetisation process should make possible.
As far as ascribing a value to those reserves, you cannot just multiply those reserves by the current price of oil, firstly because they are BOE ( barrel of oil Equivalent), not just oil.... and secondly you have to value those reserves at a NPV value, typically NPV10 ( NPV with a 10% discount) because those reserves are produced over a 15-25 year time frame, not all in one instant.
At the current price of oil /gas ,depending on the percentage breakdown of oil/ gas are in that BOE , a range of US$10-20 would not be unreasonable IMO.... and you would get people arguing for both lower and higher values.
So , if BRK in 2-3 years time were to have acquired 10000-13000 acres and proved 40 million BOE with an NPV10 of US$ 10 per BOE, you would get a value of US$ 400 million. If those 10000-13000 acres were to prove 100 million BOE, and were ascribed a NPV10 per BOE of US$ 20, you would come up with a value of US$ 2 billion.
You would expect all BRK 2022 options to be converted so the shares on issue would approach 5 billion.
To estimate a potential value per share ( not price per share) and using the above value ranges, (before any discount would be applied to any PUD sale and ignoring production revenue) it would be fair IMO to ascribe a potential value range of US 400 million/ 5 billion SOI or US 8 cents to US$2 billion/ 5 billion SOI or US40 cents .
Even if for whatever reason there is a problem with the Jewell ( heaven forbid) and it disappoints, the fact that the SWISH play is exploitation, not exploration, a negative well outcome will dent, but not derail BRK's march forward.
There is no doubt that there is a fair bit of bow drawing to get to the above point and no argument that a lot of things have to happen over the next 2-5 years. However understanding the BRK business model , the background of management both in Australia and the USA, lessons learned and the current milestones achieved to get to where BRK are in July 2021, BRK will build a significant asset base in the USA over the next few years.
Cheers
Dan
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