re: Ann: Fortnightly drilling report - Anothe... You twisted my...

re: Ann: Fortnightly drilling report - Anothe... You twisted my arm tui.
I am just about finished reading it (some parts a couple of times ha). I agree, it is very well written, covers everything.

So, up until July 2012, I held a company called Aurora Oil and Gas(AUT). Its a Australian company in the U.S, producing in the Eagleford shale, its MC is $1.6 billion. They are currently producing a bit over 9k barrels a day.
Their acreage is pricey to say the least (disclaimer- it is a clearly proven shale basin), but.. its liquids rich and valuable. How valuable you may ask, well.. in recent corporate deal, AUT increased its acreage in arguably the most prime spot of the Eagle Ford shale, they bought 1440 acres for a measly $95 million. Yes, that's right, they paid over $65.5k per acre.

Now, Senex says they have 1.2 acres that could be shale rich. Well.. if you take out everything that SXY currently owns, i.e. 8.1 million barrels of oil (2P) and the 85 million barrels equivalent of coal seam gas reserves & resources, the $165 million in cash and all its other tenements and infrastructure, then the company's MC of $740 million, means that this possible acreage is worth $616 per acre. OF COURSE there is much work to be done etc etc drilling, development, booking BUT... I merely want to try and get across that this is the main reason I bought into SXY. All the other things I mentioned is great for an Oil & Gas stock, but I wanted more.. for 'free'.

SXY also aim to materially increase the 2P amount of its Coal seam gas in the next 12 months. I wonder if this has been discussed before, but if SXY does want to go 'all in' to the Cooper, would it be viable to sell is Coal Seam gas interests..? to fund what will be a big bill (but a worth while one). As if they can increase the 2P to near 50 million barrels equivalent, then we are talking huge numbers. I mean even at $10 a barrel, that is half a billion. No more capital raisings for a while I would think.

SXY also aims to get some nice 2C numbers for the Cooper Shale in 2012-2013. I must admit, I am a holder of other Cooper stocks. As the 3 main ones, BPT, SXY and DLS (STO is the sleeper btw-they are spending big $$ but all very hush hush) have the dominant positions. All their individual drilling supports the others, either directly or indirectly as every drill that succeeds in turn leads to proof of concept and hopefully future commercialization.

Between BPT, SXY and DLS(with J/V) off the top of my head we are talking $200 million plus next year in Shale drilling expenditure. 1 year!!

Sadly no red for me tui- its a work night and I need my wits when dealing with teenagers.

Looking forward to further discussion and please correct me for any mistakes etc.