This ridiculous market has brought forth this amazing opportunity for us! WLL has about 300 million barrels of proven oil reserves not to mention it's natural gas reserves. Even though oil is $79.00 per barrel, which we all know won't stay that low for very long, WLL's valuation is equivalent to 300 million barrels of oil multiplied by $79.00 per barrel divided by 117 million shares outsanding. My conclusion is that WLL is worth at least $200.00 per share without any consideration of it's natural gas or natural gas liquids valuation. Any debates on my mathematics? I'd say I'm staying long and accumulating more at this point!
In response to your $200 per share valuation ... it seems to me that you made a mistake in assuming the $79/barrel figure would equate to $79/barrel profit ! If you estimate $30/barrel profit the valuation would come to about $70/share , still a nice run from here , but a long ways from $200.
Thank you! I stand corrected. So factoring in the right metrics still comes to a valuation of about $128.00 per share based upon James Volkers hedging per barrel stated the other day which was $50.00 per barrel. So 300 million barrels times $50.00 per barrel divided by 117 million outstanding shares = 128.00 per share. Still insanely cheap!
Oil is only cheap because of Govt pressure to keep it low....Politic's don't like it when the masses complain about gasoline prices....Govt's (ie Venzuela) keep it low to control the masses and allow them to think all is right in the world...
Meanwhile.....all other goods are not affordable...
Oil is a finite resource....expensive to find, produce and refine... its value is limitless without intervention
Today's news certainly seems positive to me...comments?
09:05 EDT Whiting Petroleum updates on well completions in North Dakota
Whiting completed the Norgard 21-13H well at its Hidden Bench prospect flowing 2,522 barrels of oil and 3,258 thousand cubic feet of gas or 3,065 barrels of oil equivalent per day from the Middle Bakken formation on September 17. The flow rate was gauged on a 48/64-inch choke with a flowing casing pressure of 800 psi. The well was fracture stimulated in a total of 30 stages, all using sliding sleeves. Whiting owns 59,170 gross acres in the Hidden Bench prospect, located in McKenzie County, North Dakota. The Company plans to drill a total of 12 wells in the prospect in 2011. Also at Hidden Bench, Whiting completed the Johnson 31-4H in the Middle Bakken flowing 2,089 barrels of oil and 2,587 Mcf of gas per day on July 28. The well was tested on a 48/64-inch choke with a flowing casing pressure of 600 psi and was fracture stimulated in a total of 30 stages, all using sliding sleeves. The Johnson well is located approximately three miles northeast of the Norgard well. In the Company's Pronghorn area of the Lewis & Clark prospect, Whiting completed the Smith 34-12TFH in the Sanish Sand formation flowing 2,446 barrels of oil and 2,959 Mcf of gas per day on September 15. (WLL)
I won't debate the valuation, but I do think the following:
Oil is prob. going to go lower, to the mid 70's. for a bit - maybe 3-4 weeks.
WLL and all other energy/oilers will get hammered by shorts all next week, creating even lower share prices, maybe even into the 20's.
WLL and a lot of other Bakken oilers will recover the S/P a bit and report huge amounts of new production i Q3,Q4, and Q1FY12
Greece going bankrupt in Dec 11 will hurt, but I think that S/P will explode in Jan FY12
I sure as shizz hope so...
Greece's importance in the world is overstated! They represent a very small percentage of overall GDP and have always been in default since the beginning of time! I blame the Eurozone representatives for even letting them become a Eurozone member country. Greece mis-stated their financial standing and qualifications to them.
As for oil demand, just because the US and eurozone countries are in decline, there is enough external demand from developing regions. Remember the overly dysfunctional and incompetent Obama regime still does not allow drilling in the Gulf so this bodes well for inland drilling demands.