rfe by project

For those who know the RFE story, the piece in yesterday’s Age actually confirms Red Fork’s strategy of building cash flow from oil production now at the same time growing its land position and reserves in its Nat Gas projects at the low point in the price cycle. I was surprised that many (including the journalist) missed the relevance of the last paragraph - RFE is generating revenue from oil...

The article also highlights the importance of some of the co’s key competitive advantages.

Some facts:

West Tulsa

100% owned and operated.
2.9 million barrels of oil in certified 2P reserves.
NYMEX Oil US$70.3
Total cost of production less than US$20 per barrel (including finding & development costs, royalties, and state and federal taxes).
2P reserve generates total NET revenue of US$145 million at the current spot price.
NPV at 10% of approx. US$30 million.

Osage

100% owned and operated.
1.0 million barrels of oil in certified 2P reserves.
NYMEX Oil US$70.3
Total cost of production less than US$20 per barrel (including finding & development costs, royalties, and state and federal taxes).
2P reserve generates total NET revenue of US$50 million at the current spot price.
NPV at 10% of approx. US$10 million.

East Oklahoma

100% owned and operated.
Certified 2P reserves per well of 0.3Bcf.
NYMEX Natural Gas US$3.36
Total cost of production less than US$2.00 per Mcf (including finding & development costs, royalties, and state and federal taxes).
2P reserve generates total NET revenue of US$320 million (assumes 600 wells drilled on 80 acre spacing’s and gas price escalation from current spot price to a maximum of US$6.00 Mcf).
NPV at 10% of approx. US$75 million.

An expanded EOK Project would double these numbers to:
NET Revenue of ~US$600 million and NPV at 10% of ~US$150 million.

All this generates total NPV for the Company of approx. US$190 million

Assuming exchange rate of $0.80 this equals A$240 million.

Add current cash of approximately A$30 million to get a total NPV of A$270 million or $2.00 per share.

The Company has no debt and is fully funded to execute this plan and unlock this value.