Goldman Sachs recently released a company update on Chesapeake Energy Corp. Within that update, they place a value of $0.30/mcf to $0.68/mcf on their assumed unbooked resource in the Marcellus Shale.
Talisman Energy's (TLM) Hudson Hope presentation states that there could be as much as 350 bcf/section of gas in their Montney lands which are adjacent to Canadian Spirit Resources Inc. (SPI). TLM also states that they believe their recovery rates will be from 10% to 30%.
Interpolating TLM's numbers across SPI's Montney lands, one can determine SPI's assumed unbooked resource in the Montney Shale:
44 sections of deep rights x 35% net interest = 15.4 net sections
at up to 350 bcf/section = 5.4 tcf
10% to 30% recovery rate = 0.54 tcf to 1.6 tcf
SPI is currently trading at $1.60/share with 48.7 M shares outstanding = $77.9 M market cap.
SPI is currently valued at $0.05/mcf to $0.14/mcf or 16% to 21% of Goldman Sach's valuation of CHK's unbooked resource.
This valuation does not include any other SPI assets such as infrastructure, cash, tax pools or Gething rights.
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