I don't quite understand how LT can state XOM will spend another $billion on E/A wells. Per p51 of the annual report: "We have spent $268.0 million on PRL 15 which includes seismic, Herd Base/Hou Creek wharf and camps, roads, FEED for wells, gas gathering, condensate stripping, and pipelines". That includes I trust the 5 completed wells. Per the presentations to Raymond James and IPAA earlier this year IOC is projecting 8 mtpa (about one billion cu ft/day) will require 5 - 11 wells. Just for the sake of argument, @$25M/well (pretty high with existing infrastructure and limited testing!) that's 40 more wells! I seem to recall Antelope 1 and 2 combined for more than a billion cf/d by themselves. [edited post, I earlier dropped 3 zeros a couple of places above. Oops]
Seems to me a lot of LT's argument on the value of IOC's first 4 TCF (at $1.25) is that it gives the company a way to book the rest of its reserves and get the $1/mcf for the condensate. If there were a case to be made for incompetent IOC management, by God sale at that price for those reasons would be it.
Seems to me a lot of LT's argument on the value of IOC's first 4 TCF (at $1.25) is that it gives the company a way to book the rest of its reserves and get the $1/mcf for the condensate. If there were a case to be made for incompetent IOC management, by God sale at that price for those reasons would be it.