the Announcement on the 19th Sept has a table with an oil price of $60 .00 shows a payback of 0.56 years (207 days ) at an IP of 50 BOPD so seems sharply different from your absolute statement Sector lead , although you never mention BOPD rate
My rough calculations showed AKK were being optimistic about payback I came up with 277 days against their 207 days ie :
well completion cost $500K
net price per barrel = brent $60- 8 = 52.00
52* 75% = $39.00 after royalties
Lifting cost = $3
So $36 net back in gross profit
At $40 a barrel it looks barely economic to me
32(Colorado price ) * 75% = $25.00 after royalties
Lifting cost = $3
So $22 net back
$500k / $22 a barrel =22727 barrels of oil needed to pay back
At 40 barrels a day average that would take 568 days to pay back and guessing the IP would have to be around 80 barrels a day to get a 40 barrel average , given another ASX driller in the area had fast decline rates a number of years back .
AKK Price at posting:
0.7¢ Sentiment: None Disclosure: Not Held
