estion 4. Comprethensive calculation for integrated oil company in an US plese answer questions follow instruction. (Totally 50 marks) An integrated oil company is interested in bidding on a prospect. The lease bonus is expected to $30.000. In addition, during the same year, $0.5million will be spent on intangible costs and S0.5 million will be spent on tangible equipment. During the second year, an a milion will be spent on tangible equipment. Assume the useful life of the equipment to be seve yers. The production is expected to start in the third year. Based on the analysis of nearby and gecophysical data, the initial production will be 80.,00 barrels in a year and will decline at a rate of 8% per year. The production is expected to last for at least 12 years. Assume that the Qu recoverable reserves are estimated to be 800,000 barrels. The oil price can be assumed to be $20 /bb during the entire production phase. The royalty payment will be 12.5%; the severance tax rate is 7% and the income tax rate is 34%. The operating costs, including the ad valorem tax, are expected t be S100.000 and increasing at a rate of 4% per year. Assume the salvage value at the end of 12 years be zero. Calculate the net present value if the MROR is i 5%, what is a ROR on this property? Requirements: 1) Explain bow to calculate depreciation based on ACRS methods. (5 marks) Q Fill in the blanks on the below table Iwhen yeu offer the maximum bidding price 630 marks) (5) Calculate the NPV for the project. Do you think the project is a feasible project or not? Why? (5 marks) (P.S. the discounting net revenue without blank (15) is $277.951.06) 3) What kind of depletion method will be applie! in the calculat va? Plesse explain ti aiculation process based on the depletion method. (5 marks) (3) If the company is independent oil Company, what kind method will we applied to calculate it’s depletion. Please explain the method. (5 marks)