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Southern Pacific Petroleu (SPPTQ) Message Board

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  • Bottomfisher1 Bottomfisher1 May 21, 1998 6:28 PM Flag

    Definitely an asset play.

    I am also a long time investor in SPPTY & CPMNY.
    I sold at $3� (on the way up.) I want to accept
    your question answering offer--and the query relates
    to the production cost of oil from Queensland shale.
    Ten years ago, SPPTY said that estimated shale oil
    production costs were $40 to $45 per bbl. They also said
    that Japanese interests were financially helping SPPTY
    stay alive as a reserve for Japan in case world oil
    became scarce and shale oil production turned
    economically viable as an oil source for petroleum-poor Japan.
    Question: What has happened since I sold, if anything, to
    bring oil shale production costs down? What is the
    current and estimated future production cost of shale oil
    per bbl? Thanks in advance for your answer.

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    • Alot has happened over the past 15-20 years. The
      AOSTRA Taciuk retort is very efficient. In full swing,
      several years out, I betcha the cost can drop to
      $7-8/bbl.

      At first, the twins won't have the economies of
      scale in Stage 1- which is limited to one retort module
      producing app 4500/bbl per day. It doesn't matter that much
      anyway, since they have some significant tax & R&D relief
      for Stage 1 & then some.

      If Stage 1 works OK,
      they'll go to Stage 2, app 15,000 bbl/day- or maybe
      they'll skip to Stage 3, a full 65,000 bbl/day. The shale
      is very rich, lays close to the surface, very little
      overburden on top, good climate, & very close proximity to a
      port. The twins should come in better ultimately, in
      terms of operating cost, than either Suncor or
      Syncrude, both of which operate under harsher overall
      conditions in Canada. The twins are talking about a little
      more than $8/bbl operating cost.

    • As we understand it P/B U.S.$ +/- 12.00. Don't hold us to it we took this off the top .