@SKM - I think what may have "spooked" some is that this article...

@SKM - I think what may have "spooked" some is that this article came out between VD's articles and as such may have be perceived as part of an orchestrated "pump".

@JM - The value in this article (for me) is that while I like to focus on peer metrics what this article does is look internally only to justify how it manifests value. There is no better explanation than the following:

" In the simplest terms, doing nothing but re-investing existing cash flows, they can be producing 7,000 boe/day just out of the existing Eagle Ford acreage with existing proved-undeveloped locations (again, completely ignoring any contribution from probables)."

Now this author uses the Strip pricing for his economics statement - so he is being conservative

"Basically, at around the 7,000 boe/day mark, this asset is throwing off $150mm in positive cash flows and, assuming a $25.00 DD&A charge, an $85mm contribution to EBITDAX. If you drill the 15 wells needed to just do maintenance of this production rate after that, you're looking at a total of around $86mm CapEx. Net result: $64mm pre-tax cash flows on average for about 6 years!"


You (JM) had questioned earlier whether LNR is still genuine value - and for me it remains so. I have been tempted to add more but haven't (only due to potential multiple "contraction" in a global sell off) but at present IMO it has a margin of safety that is superior to others (esp on ASX).