MS, some rough calc's of mine which I am using for benchmarking which whilst not exact may give some insight. I haven't included hedging but think that since March qtr there has been a step change in operations where receipts less production cash costs have now covered admin for the last 2qtrs and using the Dec. forecast numbers this could be similar in Dec. (see below)
Please note my boed will be different to what coy has reported as I have used price to calculate the oil equivalent value as I find the result is easier to compare to others and eliminates issues with gas/oil makeup of sales when comparing to different operations.
Re the older wells they are likely to be paid off by now so as long as the cash received is greater than cash cost they would still contribute with lower prices.
An important number for me to watch has been the production costs which appear to be consistent over the June / Dec qtrs whereas last year this was up and down. As more wells come on line these costs should be more predictable and individual wells should have less effect on overall numbers. Imo the current SI wells are possibly masking a better performance for this year and if so will only be a timing issue. The cash effect of this should probably flow into March 2015 quarter but some of the receivable may be booked in Dec accounts if they get producing this mth.
All is my opinion, whilst the key numbers are based on the qtly's the further analysis may have some flaws but is good enough for my purposes which is more to do with benchmarking and identifying value. SSN is a good stock to watch and also imo a good litmus test for overall mkt sentiment. Currently I think for O&G that sentiment is poor and is most likely a big part of the reason SP is not reflecting some good fundamentals.
Cheers
