Replies to post #7357 on Hero Technologies Inc (HENC)

[Smooth]

Will the real P please stand up? This P stuff can be confusing!

When probabilistic Monte Carlo type evaluations are adopted, this is a statistical confidence level for an estimate.

P50 is defined as 50% of estimates exceed the P50 estimate (and by definition, 50% of estimates are less than the P50 estimate). It is a good middle estimate. Mean and Expected (same level of measure just different names) usually lie about the P40-P30 levels in oil field evaluations and are therefore high estimates. P90 and P10 are low and high estimates respectively.

P90 means 90% of the estimates exceed the P90 estimate. It does not mean that the estimate has a 90% chance of occurring – that is a very different concept.

The central limit theorem indicates that the P50 estimate has more chance of occurring than the P90 and P10 estimates.

[Smooth]

Got myself confused here too...P90 and P10 price targets were incorrectly swapped...P90 price targets were actually P10 targets, and vice versa. Corrected below. Sorry for any confusion!

1. P90 is the low reserve estimate

2. P10 is the high reserve estimate


Corrected Price targets

Henc: P90 pps = $7.50, P10 pps = $29

TGC P90 pps = $3.50, P10 pps = $15




Original Price targets


Henc: P90 pps = $29, P10 pps = $7.50

TGC P90 pps = $15, P10 pps = $3.50


Again, it's crazy to think that these possible price targets are based on just <6% of the company's acreage where either 2D or 3D seismic have been shot to date.

[tchauncy]

Smooth- It is good you are reminding all as to the reserves potential, but the info you are putting out is only for about 32,000 acres where 3D was shot on PEL 112 and is based on the ISIS Volumetric Reserve Engineering report put out in 2010 which only covers conventional oil (not gas, shale gas, Coal Seam gas, or shale oil). (112 is still my personal favorite for the long term)

TMK, there are no published reserve potential estimates for the 25,000+ acres shot on 444 where we will drill next. But from several sources, I have heard that both Management teams feel the 444 reserve potential is even larger than 112.