The chairman of EOG stated a year or so ago that it cost him 18 bucks to get a barrel out of the ground and 12 bucks to get it to market. Has SD revealed what their costs are per barrel? If not, can any of you construct the number?
I figure a $31 cost per bbl. However, when we start talking about "net-net-net-net costs" per bbl you have a lot of things to figure. The $31 cost I use is a "direct cost" per bbl and doesn't include things like SG&A costs etc.
Why do you think SD's cost to produce and market a bbl Is greater than EOG's 30 cost?
If there is truly a 60 buck margin, just stopping all other non direct costs should make this a big cash flow winner.
I think that is a fair estimate. I see it about the same and figure that SD can't make any money if crude prices fall below $65/bbl. Nevertheless, my $65 number is a point where I figure SD would quit drilling for crude.