vtsnowedin wrote:
Any details about the recoverable reserves these two had in hand? Considering the pace of new discoveries working fields with a known production end game should be worth a lot more then leases in undrilled areas.
From quite near the end of the report:
Proved 3,612 mmboe
Probable 2,913 mmboe
Discovered resources 6,279 mmboe
Risked exploration 4,212 mmboe Total reserve 17,016 mmboe
Shell reserves total proved reserves 13.1 billion boe
That is what is quoted in Shell's report - they have been known to have told the LSE porkies before about their reserves...
SO 13 plus 4 equals a nice boost to their reserves. That is probably the real value in the deal.
Might not pan out exactly that way, VT.
But, BG said in its annual report published last week:
"In certain specific circumstances, it is possible that BG Group's partners in BM-S-9 (Petrobras and Repsol Sinopec Brasil) have a right of first refusal to acquire BG Group's interest .. in the event of a change of control of BG Group plc".
BG and Shell declined to comment on the BM-S-9 rights.
Mods do you think the Shell/BG merger should be in a separate thread?
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
SO 13 plus 4 equals a nice boost to their reserves. That is probably the real value in the deal.[/quote]
Might not pan out exactly that way, VT.
[/quote]
That is what I expect. Hard cash investments in real proven reserves by those that can tell the difference while the average Joe gets dazzled and bamboozled by ponzi schemes on the "ground floor" of the next big deal in "Arctic" Deep water"" fracking"etc.
Actually VT, Shell has been caught up in the Ponzi hysteria of both shale and Arctic Deep Water.
The bottom line is that there is a great deal of panic in the big oil cos as to where they can secure the rights to hydrocarbon reserves for future profits. Then there are the variables of the cost of production and the price they can get for it on the market.
Given the muted performance of Shell on the Stock Market it would appear that the City consensus is that Shell is paying over the odds.
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
raspberry-blower wrote:Actually VT, Shell has been caught up in the Ponzi hysteria of both shale and Arctic Deep Water.
The bottom line is that there is a great deal of panic in the big oil cos as to where they can secure the rights to hydrocarbon reserves for future profits. Then there are the variables of the cost of production and the price they can get for it on the market.
Given the muted performance of Shell on the Stock Market it would appear that the City consensus is that Shell is paying over the odds.
I don't know about the present leadership at Shell oil but this past president of the company appears to have his facts straight. The clip is from January but they did another last week and both stuck to the bet. http://video.foxbusiness.com/v/40025528 ... show-clips
I read somewhere that it is not so much about reserves but cash flow. Shell needs money to pay dividends and BG seems to fit the bill for the next few years.
biffvernon wrote:Yes, for 'reserves' read 'stranded assets' so the whole industry now has to be in cash-flow maximising mode.
Yes we are thinking alike on this one. Once the EROI becomes less than about 5 - 9 there is little point of getting it out the ground for energy or transportation fuels.
There was a program on the NatGeo last night on the decommissioning of a gas rig in the North Sea. A single field with a few platforms cost 1.5bn so the whole North Sea could be a fortune. (The value of the metal was about 200,000 pounds). Of course the big oil majors will all declare bankruptcy long before this happens. Give all the equity to shareholders, replaced it with debt, pay off all the executive's golden handshakes and then declare insolvency.
BritDownUnder wrote:I read somewhere that it is not so much about reserves but cash flow. Shell needs money to pay dividends and BG seems to fit the bill for the next few years.
Here we go:
Shell sells 185 UK petrol stations as retail divestments continue
US shale, and hence global oil production almost certainly peaked in January. EIA figures and future oil production estimates are out there with the fairies.
There will be significant recovery in oil price before year end. What happens after that depends on too many unknowns - Chinese demand is a big one, Libyan and Iraqi production another.
The current feel good factor in the UK was perfect timing for the general election, except that the Tories are suffering from the 'If the economy is booming why are we facing even more austerity?' blowback.
Economists seem to understand that the fall in oil price has been a big plus to the global economy, but still fail to realise that $100/barrel is why the economy was on life support in the first place.
PS_RalphW wrote:Brent has crept back up over $60, testing $61.
US shale, and hence global oil production almost certainly peaked in January. EIA figures and future oil production estimates are out there with the fairies.
There will be significant recovery in oil price before year end. What happens after that depends on too many unknowns - Chinese demand is a big one, Libyan and Iraqi production another.
The current feel good factor in the UK was perfect timing for the general election, except that the Tories are suffering from the 'If the economy is booming why are we facing even more austerity?' blowback.
Economists seem to understand that the fall in oil price has been a big plus to the global economy, but still fail to realise that $100/barrel is why the economy was on life support in the first place.
Stock market technical analysts are talking about $55 being a breakout price, and that this will lead to significantly higher prices in the coming weeks.
Myself I prefer to read tea leaves, but the only reason to consider technical analysis, is that if enough traders believe it, it can become a self-fulfilling prediction.
PS_RalphW wrote:
There will be significant recovery in oil price before year end. What happens after that depends on too many unknowns - Chinese demand is a big one, Libyan and Iraqi production another.
All the economic indicators for China are showing a serious downturn - so the market takes crude higher.
Who said markets were rational?
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
