Dan Ulmer: Big dreams of spending oil money
Both my loyal readers frown and scratch their heads whenever I start doing math, so hang on. Since you seem to still be with me here, let’s say you got an email from your uncle saying that your grandparents owned 40 acres of mineral rights east of Glendive, Montana. And let’s just say, for figuring sake, that they happened to strike oil and the well pumped 2,000 barrels of crude oil per day.
Then for more figuring sake, we’ll peg the price of a barrel of oil at $100… the math would then indicate that 2,000 barrels times $100 equals $20,000/day. Then we’ll assume that 5 percent of each barrel will come to you each day as a royalty, the math here indicates that every day for the next 20 years you’d get a check in the mail for $1,000 or $30,000 per month for an annual total of $365,000.
Now let’s say that you’re taxed at 20 percent, so your earnings would decrease to the point that your daily cash flow would be reduced to $800 and your annual take home after taxes would end somewhere around a mere $292,000. In 20 years you’ll will have accumulated and most likely found a variety of ways to spend $5,840,000… and that left me wondering what I’d spend that on.
So here goes, I’d like an island in the Caribbean, but I don’t think I could get more than a speck of sand for a mere $5,000,000, so that’s out. Maybe a condo on the coast of Belize would suffice… or a rental in Aruba. Then I’d need a pair of Speedos and a snorkel.
I’d settle for a new pontoon, a couple of snowmobiles, and maybe a Harley Davidson motorcycle.
I’d like to travel to some ski resorts so I could pretend that I’m 18 again and maybe buy a nice car to travel around the country following the seasons and seeing what there is to see.
But then again it would be kinda fun to become a philanthropist donating money to worthy causes that tickle my fanciful desire to leave the world better off… Alas, my desires seem to wane much faster than they used to but it’s still fun to fantasize about owning my own jet and flying to San Diego for an evening dinner at the Hotel Del Coronado then making it back home in time for the Letterman show. Maybe flying off to Colorado for a couple days of shooshing Vail, maybe Miami for a day of jet skiing in the ocean or a flight into Anchorage for some crab and halibut. But alas, my $5,000,000 won’t buy me a jet, so I’ll have to fly commercial…
And as reality begins to return I need to tell you that my uncle did email about my deceased Grandma Cora still owning 40 acres of mineral rights in the Bakken. So my relatives on the Ulmer side of the family are somewhat abuzz and hoping that something may come of this news.
Of course there are a few details as my grandma had five children who created 26 grandchildren who begat 35 great-grandchildren who have since begat more offspring than we’ve been able to keep track of… so there’s a lot of division to be done here and since both my loyal readers will affirm that math has never been my forte, I will let you check the results of my calculations.
My math seems to indicate that even if the dream of striking oil came true, my share of this windfall would have to be divided up amongst all them other relatives and thus I might be able to afford a latte at Cappuccino on Collins so I quit fantasizing.
It’s kinda fun to think about what you’d do if you won a ton of money… at least it was for me for a minute there… and that private jet thing would be kinda nice.
Here’s hoping that you get whatever you need whilst you’re waiting for your ship to come in…