I hope you are right, but when I was doing my research on PVR I read an article saying that they were hoping to get $6 per barrel in any farm out deal, but may have to settle for $4 or 5. Unfortunately I can't for the life of me remember where I read it. However, even if the article was right it would still be a pretty decent rise in the SP.
a post of the highest order , thanks for the detailed answer so we know majors are sniffing and we could have one asset worth 2.67-4.5 area alone makes this an outstanding buy and as you state plenty more .
I too think LOGP will sell their 20% stake in Barryroe before production starts. I believe that is LOGP's stated aim. LOGP only have 2 employees and they are both Directors. The company is not geared up for production.
Price per bbl of oil? Well some North Sea assets have been bought recently valuing the oil in the ground at US%17 per bbl pre production. And that's been heavy oil!! Barryroe's oil is more valuable light oil albeit with a relatively high wax content of circa 18-20%. However, by all accounts, the wax can sell for more than the price of oil.
At US$17 per bbl that values LOGP's 20% stake at US$17 x 56MMbbls (current P50) = US$952m = £635m or £4.50 per share. Being conservative and taking US$10 per bbl that gives £2.67 per share.
Of course what we don't know is what reserve figures for Barryroe the latest CPR is going to issue.
PVR have indicated they want to keep 40% of their current 80% of Barryroe. I should think a Major would become the operator since they are geared up for operating such a big field whereas I doubt PVR are. So if a Major took 40% from PVR and added LOGP's 20% that would give them 60% and they would be the operator.
PS. Don't forget LOGP's 3 other Celtic Sea licences awaiting farm outs. 2 are 100% owned, the other 99%.
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