Question
A lease owned by Company XYZ has to be evaluated. The lease is currently producing at a rate of 4000 Stb/month. It is estimated that
A lease owned by Company XYZ has to be evaluated. The lease is currently producing at a rate of 4000 Stb/month. It is estimated that production will be constant for one year, and then decline exponentially at a rate of 30% per year. Current operating expenses are $15,000 per month and are expected to increase by 10% per year in a step-rate manner. Oil price is $15/Stb, and severance tax is 12% of gross revenue. The company has a 50% working interest and a corresponding net revenue interest (NRI) of 40%. Determine: a. EL. b. Remaining 8/8ths reserves. c. Remaining net reserves (your company's share). d. The economic productive life of the lease. e. The cash flow to the EL.
can't understand this question in Chegg we have different answers but in Bard gpt the answer is totally different. Confused can you explain how can make the question
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