2,500*365*$25= $22.8m a year based on current oil prices. At 10x earnings that's $228m, or £150m- which is a value of 7.5p a share. Texas would top that up by a few pence to basically makes the price today risk free- that is IF it comes off, and IF you're prepared to hold for 15 months.
I'm not sure whether 2500 barrels a day is achievable mind you. PL, in my opinion, has a tendancy to be over-optimistic. However if Texas is sold next year, we can afford to wait for Trinidad to start delivering the goods, as the company would have the capital it needed to run for a long time yet (if we can get $100m+ for Texas).
To raise the price from here substantially, however, more oil will need to be discovered. That means either Georgia coming off, or a Herrera formation target finding commericial oil. That will allow the drive to 10000bopd as originally stated when Range acquired Trinidad- now that would add some serious value.
RRS Price at posting:
17.0¢ Sentiment: None Disclosure: Not Held
