Re: Unconventional Exploration. Present For The Future.
in response to
by
posted on
Jan 17, 2009 05:30AM
Developing large acreage positions of unconventional and conventional oil and gas resources
One of the questions was whether the 340bcm was the total risked resource for the whole trough and they said it was but it was very conservative
I remember your post, and have read it many many times since then. That was a nice piece of work. I'm still sceptical about their numbers though, and what it represents.
"The discrepancy between the two estimates does not come from any calculating errors, explains Attila Holoda, but probably from the size differences of the geological structure considered"
Probably? I think it's safe to assume that MOL's numbers only represent the Szolnok, but regardless of what they say, I think it's still questionable as to the area it represents. But we can all agree that in any case, the quantity of gas is enormous.
I think there are just too many variables at this point to be trying to come up with exact figures. When you have a lot of variables, and start throwing in risk factors, the errors become exponential.
For example, 4 X 4 = 16. Apply a 50% risk factor to the result, and you get 8.
Now apply a 50% risk to both numbers. 2 X 2 = 4.
The end result is now only 1/4 of the correct answer.
On the other hand, if you have 3 or 4 variables, apply a risk factor to all of them, and STILL come up with valuation of $1.25 per share, that's quite promising :)
Of course if they can't get the gas to flow economically, none of this really matters.