10-02-2012, 05:21 AM
jft,
I am a fellow uber, but be careful when you say, "Expected cash flow will be $4.5 Billion for IOC owners." Note that is for the complete project, but post selldown IOC will probably only own 30% or so. Which is still huge. If it trades 10 times that CF measure that would approximately value IOC at almost 4 times its current valuation (this doesn't consider any proceeds from selldown, but assumes the proceeds are used to fund the project and drill a bunch). Also, $4 billion in CF for the entire project isn't estimated until 2019. Lots of execution required between now and then. Of course, if you want to be uber bullish though, you should try and estimate the value of IOC at 12 mmtpa from E/A, then throw in some sort of production off of B/T plus whatever else they may find.
Best,
Sam
I am a fellow uber, but be careful when you say, "Expected cash flow will be $4.5 Billion for IOC owners." Note that is for the complete project, but post selldown IOC will probably only own 30% or so. Which is still huge. If it trades 10 times that CF measure that would approximately value IOC at almost 4 times its current valuation (this doesn't consider any proceeds from selldown, but assumes the proceeds are used to fund the project and drill a bunch). Also, $4 billion in CF for the entire project isn't estimated until 2019. Lots of execution required between now and then. Of course, if you want to be uber bullish though, you should try and estimate the value of IOC at 12 mmtpa from E/A, then throw in some sort of production off of B/T plus whatever else they may find.
Best,
Sam