Valuation Metrics to consider, page-15

That picture taken from a presentation by Ian Cockerill ... an author that should be well known here, right?

"Heterogeneity in Unconventional Plays and Quantifying Sweet-Spots in the NEBC Montney"

Ian-Cockerill-Presentation

@Motors

talks the non-homogeneous point I was making earlier

Why should Ian be well know here?

TSV Montey Finding Sweet-Spots and Quantifying Recovery Potential in Unconventional Plays:

A 2016 article written by Ian Cockerill and Aaron Hughes

If you haven't watched this video already I highly recommend spending the 15 mins it takes ... really well explained.

The upshot for me is then how that IP30 data (which we soon will have) of "Liguids-Gas-Ratio" map and subsequently to draw out the "Liquids-in-Place" of Mmbbls per section. From there it goes to the Common Recovery mapping techniques to identify the sweet spots.

Ian and Aaron also utilise the NEBC Montney Play Atlas  and associated well data - here is what is was in 2012. (takes a while to load though). If you look closely enough at some of the detail you can see the beginnings of Saguaro and Black Swan acreage

Montney-Play-Atlas

Hopefully this picture "positions" CE1 acreage a little easier into the area of interest - 94G using the NEBC Atlas, Saguaro, & CE1 maps.

What this does do for me is reinforce that the acreage had high potential before Calima assembled its original land packages.I am not challenging the the geo's (since I'm not a geologist) - what I'm interpreting is that their application of Common Risk Segment Mapping techniques identified a potential sweet spot in a area already identified as part of the extended Montney Trend - something which I expect to be confirmed by the drilling package in Stage 1.

The more I think about (or overthink) this "asset play" though the more cautious I become ... not that it wont have intrinsic value but that it might be difficult to monetize quickly ... which puts partial development on the cards and that takes capital (lots of it because wet gas needs gas plants and fractionation capability) while we wait for the bigger fish to nibble. And LNG Canada IMO has no need.

I keep thinking that BSE's acquisition of Camel Bay's Jedney/Nig area in 2015 was priced (unadjusted for risk) at CA$2,421/acre, $8.89 per 2P BOE (with WTI $60.14 and NYMEX Gas at $2.41).

I think CA$2,500/acre is reasonable, assuming the proof is shown from drilling. Also like to know the 2P they'll receive from Stage1 and estimated from doing Stage 2. Means I think I have to hold longer than what is commonly thought here. Hope I am wrong about that part.

Also interesting is this pick - again its 94-G. Source is BCOGC

One last thing (if you're not already bored to death or think there's too much work here)

Taken from BMO Capital markets in 2014,

"THE OUTLIERS: FINDING TRIPLE DIGIT IRRS IN THE UNCONVENTIONAL MONTNEY FAIRWAY"

BMO-Capital-Markets

The interesting parts for me were (also own CNQ (or CRNL) & therefore "Septimus") was the reference to "Jedney" area (acquired by BSE but close to us) and then Blueberry (own COP).

Who says O&G stocks aren't fun!