Hi sharks, On the smart phone so hopefully this is intelligible.
I read almost all of your posts across the various stocks we have in common. Likewise reading the non cheerleader posters that understand the stock or area of operation provides useful data.
The purpose of my posts was simple. Most people remember just the numbers and not the context - perpetuated by the title. I think what the herd loved and remembered was the $50 pure profit and the bopd being produced. I read it and immediately think "can't be" using today's pricing, EUR model.
So in challenging, the simplest correction was to WI%. You're response shows that and it was simple to apply right off.
The next was production. I still think we are way off but that's my opinion. BTW it is hyperbolic decline - exponential decay while similiar is a different curve but easier to calculate.
I'm pretty sure my model is ok when measured across a number of wells in a field. Happy to share with you and discuss separately.
I was also trying to reinforce the point that even with the decline that was concerning Goldie an NPV model showed development was economic and highly profitable. I believe you asked for NPV analysis
IMO the 2 factors that most effect NPV is the bopd and PoO. The first 2 years for each well is critical (the payback) and then profit for reinvestment.
The first things I did when making my various shale investments was to understand the hyperbolic decline model, how it works, how to calculate cumulative production, how to stack up your own model against the production numbers put up by the company and how the well economics pay out.
I have a passion tor numbers, reality checks and not being run over by the herd (you aren't in the herd).
Best regards
SSN Price at posting:
12.0¢ Sentiment: Hold Disclosure: Held
