Mixing and matching revenue with production can be fraught with difficulties - E.g. production from one month is booked as a sale in the next…
So in reality you should either stick to revenue sharing or production sharing and stay way clear of working from one to the other.
So the next question comes, is it worth doing with GKP in terms of filling in a gap of knowledge?
Using the simplest spreadsheet at my disposal, I have taken Mikey’s 52.2% interpretation of the PSC, my adjustment by 4% to 48.2% to reflect fees etc. and an extra column.
The idea is to work from known revenue back and check against known production figures, sourced from GKP and MOL data.
Mikey’s figures are way off as expected.
My 48.2% ties in well for the first 6 months, GKP and MOL.
The next column is an adjustment to match the average production for July and August according to GKP.
Given the minimal difference introduced, I feel that the figures produced for production are of use in filling in the gaps. My original concern was that the figures produced would only appear to be useful when they were in fact completely misleading.
Firstly, why does the average daily production on a monthly basis vary so much? Is it the production/revenue problem really that large, or is due to work in progress, or is a mixture of both, or…
Secondly, if the av daily production is the same in the next payment, then I would be expecting gross payment of $29 million plus or minus $1 million to cover reasonable expectations - more days, higher (Brent-22).