Ironbark valuation=$10 per nzog share?
Quote:
Originally Posted by
Wiremu
mistaTea, your comment "given the massive (many billions of dollars) upside potential" for Ironbank I thought I would try and find some measure of that upside.
On April 11 2019 Cue Energy included this in a press release: “This is an exciting time for Cue. Shareholders now have the opportunity to participate in a fully-funded well with a 21.5 percent participating interest. This is a 15tcf prospect, 50 kilometers from existing LNG infrastructure. “It will be company-changing if the well is successful.” Matthew Boyall said.
Presumably tcf means trillion cubic feet. So what is one trillion cubic feet of gas worth?
Steve Maley (Steve Maley, 40+ years of reservoir, operations, economics & management) through Quora replies as following, noting the dollars he uses are US$:
"It depends on a number of factors, including quality, location, contract delivery terms, etc.
In the U.S., the value at the wellhead is about $3.00 per million BTU, which for 1,000 BTU gas is the same as $3.00 per thousand cubic feet.
One trillion cubic feet would therefore be worth $3 billion at the wellhead (i.e., to the producer), which is kind of nonsensical because it will take a while to deliver that quantity.
If you’re contracting for delivery of LNG by tanker, you’re probably going to pay a higher price, probably one based on the energy content on a barrel of oil equivalent basis.
That would be a price closer to $9.00/mcf. The value of a 1 TCF contract delivered over a several year term would be $9 billion to the purchaser.
The cost of processing, transporting, and liquefying the gas is considerable."
Very interesting.
Thanks so much for that pricing.
A quick crude valuation counting NZO share of CUE is a success equals $100 per share of gas over a period of time.
Using a chance of success at 1 in 5 equals $20 a share
Then discount for drilling and development,running expenses etc and maybe $10 a share