February 20 @ 11:30 am – 1:00 pm
Note: this is the rescheduled meeting from January 23, 2024
A New Economic Yardstick for Today’s Late-life Production: Holdback Low-rate, late-life producers figure prominently in the portfolios of most oil companies, but they also create a unique financial trap for their owners. Decades of delayed plugging has accumulated liabilities while production and cash flow have tapered down. Combined these make it possible for cash-flowing properties with a positive present value to be net liability instead of an asset. This presentation explains the unexpected, the dangers it creates, and how to foresee the trap so that the tax-paying public does not end up footing the bill for our former profit centers.