re: av (another) look at this! I’ve re done it…no point doing...

re: av (another) look at this! I’ve re done it…no point doing all that work at it being unreadable because people have to update the mistakes in the original calculations.
The following is a reassessment of the Esponda field incorporating the corrections made after reading Poyndexters comments.…later on I add Oriva throne income and calculate 5 year total worth of the three projects (Oriva, East and West Esponda).

****Estimates of flows rates of Esponda*******

**East Esponda At Oriva average flow rates = 2349 Mcf/quarter/ well x 21 wells x $ 7.29 per Mcf = $US359608/quarter = $US 1.438 million a year.


If wells flow At Western Gas Average Rates (3750Mcf/quarter) = 21 wells x 3750x 7.29 = $US 2.296 million/ year

**West Esponda (assuming full 230 wells suggested in announcement from Oct 2005)

At Oriva rates = 2349 x 230 x 7.29 x 4 = $US15.75 million/year
At Western Gas average well rate = $US25 million/year

**West Esponda – assuming 115 wells

Probably better to assume half of those are actually drilled in West Esponda

Therefore using Oriva flow rates = $US 7.8785 million/year
At Western gas rates = $US12.5 million a year

**** Total potential resource value: Oriva Throne Plus estimates of East and West Esponda over five years ****
Western gas state average well life is 7-8, but last few years I assume flow rates decline
I assume five year well life.


***Total resource over five years (ASSUMING 115 Western Gas Wells)
*Using Oriva flow rates to estimate Esponda
Oriva Throne = $US.998 million/year (from previous post…not including dewatered well)
Esponda East = $US1.43 million/year
Esponda West (130 wells) = $US 7.8785 million / year
TOTAL= (.998+1.43+7.87) x 5 years = $US51.5 million/.75 = $68 million aussies ****

*Using Western Gas average flow rates
TOTAL 5x (.998 + 2.3+12.5) = $78 million/.75 = $104 million aussies

***Total Resource over five years (ASSUMING 230 West Esponda wells)
*Using Oriva flow rates = $US 90.9 million = $121 million aussies
*Using Western Gas Average = $US 137 million = 182 million aussies

Being a pessimist – i.e. using oriva flow rates and only 130 wells in West Esponda - gives a total value of $68 million aussies over five years. But then coal thickness so far in West Esponda aren’t up to expectations so that may suggest caution on even this figure. Personally, will wait for a bit more info to come out…doesn’t pass my divide by 2 rule to account for company exaggeration and my error.

However, the optimistic value is close to $182 million (i.e.23o wells flowing at Western Gas average) compared to a current cap of $45 million. Worth a look as a punt…but will take a fair while to figure out which scenario will unfold.

Hope this is legible...feel free to criticise...I really need to get back to work.