The question on reserves is a technical question, and Ill try my best to answer it for you.
Its an engineering decision on when to qualify production and its associated reserves that
come along with that production. As time passes and production levels are optimized, it
is then that a better analysis of what type and amount of reserves that can be attributed
to that production, and its associated zone (s). I dont know if this really matters that much,
it does, but its more important for me that production is stable for a particular well, and when
that happens the technical people have a better idea of how the well will perform in the long run,
(production profile of a zone should be similart in a particular area).
Anyways.... You dont have to look at what Ive just wrote.. Its much easier to get a reasonable valuation in my opinion, using a flowing barrels of day valuation and net off the debt and cash... As you can use production quality and netbacks from one company and estimate whether or not you think your company has higher qualities. If it does then use a higher flowing barrel a day number... There has been some transactions in the area, that are in the public domain. I think PTAs numbers are higher than what has been recently transacted. So im positive on the longer term pricing.. Thats my opinion....