Seeking Alpha

Stan Holland

 
View Stan Holland's Comments BY TICKER:
  • Cano: A Closer Look at Valuation [View article]
    LOL, yes I am the same guy. I'll see you on the Yahoo Message Board.
    Aug 1, 2010. 02:18 PM | Likes Like |Link to Comment
  • Cano: A Closer Look at Valuation [View article]
    You did a great job with this post. I spent many hours studying your spreadsheet. The thing that concerns me the most is the low production relative to the resource base. What is the reason for this?
    Aug 1, 2010. 11:32 AM | Likes Like |Link to Comment
  • Cano: A Closer Look at Valuation [View article]
    Robert,

    Thank you for your excellent analysis. It helped me very much.

    Concho, by their own estimates, is paying $18.21 per Boe for Marbob

    see page 8 of CXO's 8-K - EX-99.2 - July 20, 2010 for details

    $18.21/boe = (acquisition value + development costs)/(proved + unproved reserves)

    A little math shows that development costs are $14.1 per boe. Therefore CXO is paying $4.10 per undeveloped barrel and of course $18.21 per developed barrel.

    You stated that you know that PDP's are more valuable than non-PDP's, but that you didn't know how much more. Wouldn't $14.10 per boe be a decent number to use as the difference between a PDP and a non-PDP instead of trying to use a 10:1 or a 5:1 relative valuation? Wouldn't Concho's development costs be approximately the same as Cano's?
    Jul 31, 2010. 10:26 PM | Likes Like |Link to Comment
More on CFW by Stan Holland
COMMENTS STATS
73 Comments
55 Likes