04-13-2014, 02:15 AM
Yes, I understand that Relker and others on this board (as well as analysts) have done their own calculations for IOC's ownership of a LNG plant, etc. I thank them for their work. My point is that they are ESTIMATES based on ASSUMPTIONS -- a very inexact process. It would be much easier for the market to understand and react if IOC, who actually made the key decisions in the actual negotiations, gave out some info.
What would be so terrible if IOC released a statement somewhere that said something like, "When approached on a straight purchase basis, the amounts being offered for our gas were in the range of $1.80 - 2.00/mcf, but we believed ownership in a plant, subsidizing of wells, etc., was more valuable, and thus we negotiated the deal we did." (Obviously my numbers are just an illustration of the point, and not meant to be accurate.) Using this example, this would let everyone know that gas is being valued at around $1.90/mcf. Now we can value IOC's remaining gas at that value, and it's a good starting point for future gas discoveries. This is much clearer and more accurate than everyone else's estimates.
What would be so terrible if IOC released a statement somewhere that said something like, "When approached on a straight purchase basis, the amounts being offered for our gas were in the range of $1.80 - 2.00/mcf, but we believed ownership in a plant, subsidizing of wells, etc., was more valuable, and thus we negotiated the deal we did." (Obviously my numbers are just an illustration of the point, and not meant to be accurate.) Using this example, this would let everyone know that gas is being valued at around $1.90/mcf. Now we can value IOC's remaining gas at that value, and it's a good starting point for future gas discoveries. This is much clearer and more accurate than everyone else's estimates.
