My only question is how can he come up with these numbers, they all told him their plans as a % of free cf?
FCF is one of those fuzzy non- GAP concepts that can be easily manipulated . In my opinion, the only definition that is meaningful is CF after capex that is required to maintain production. But who knows what is required to maintain production?
First of all, not all production is equal. Light oil might be very different than heavy-sour crude or gas so one should look at production and netbacks.
Second, even if we assume that all production is equal what is the cost of developing production. The best guide might be a company's historic F&D costs. But are they repeatable? Is it all -in costs for land, seismic, drilling, infrastructure etc or just marginal costs from developing already discovered reserves?
So as a rule of thumb, I would take the annual production and divide by their 5-year all-in F&D costs to determine what I need to subtract from CF to get to FCF and then adjust up or down based on the above factors. Not a simple calculation.