onwards & upwards

After 6 months of procrastination, finally we will have a quarterly imminently indicating approx. $10million in Net Revenue for RFE (on an annual basis). Multiply this by 15 (which is a conservative multiple for a company in RFE's stage of development) and you have a market cap of approx. $150million. Divided by 138 million shares equates to $1.09/share.

However, what this doesn't consider is that the net revenue for RFE is scheduled to be close to $35 million in 2011 and $55 million in 2012. Do the math in regard to the multiplier of 15x net revenue and this equates to a market cap of $525 million and $825 million respectively, divided by 138 million shares = $3.80/share and $6/share.....

All these assumptions are based on self funded development, spot oil price being US$70 (currently approx. US$85) and most importantly, gas spot price being US$6 (currently approx. $4). However, what is the most important detail here is that RFE is one of the lowest cost has producers in the undustry at just US$0.31 per unit. This is the reason why the multiple should be much higher than 15 when the analysts wake up.....

The only risk here for RFE is the gas price, but with the USA recovering much faster than expected and congress set to pass the Natural Gas Bill in May 2010, this is a very low risk..... Nevertheless, at US$0.31 RFE is in the prime seat, not to mention the ability for them to market and sell gas from other producers in the immediate vicinity due to RFE having the critical infrastructure....

Please note Forkers, Exon made their recent massive acquisition based on the Natural Gas price being at least US$7. If it is not at this price or close to it, the bulk of their resources are uneconomical......

This stock is a no brainer and patience will definitley be rewarded. DYOR...