Managers at Terlingua Drilling identify a potential new drilling project. They estimate the following expected net cash flows if the project is adopted.

• Year 0: ($1,250,000)
• Year 1: $100,000
• Year 2: $400,000
• Year 3: $400,000
• Year 4: $200,000
• Year 5: $200,000
• Year 6: $300,000
• Year 7: $100,000

Suppose that the appropriate discount rate for this project is 10.6%, compounded annually.

Calculate the net present value for this proposed project. Do not round at intermediate steps in your calculation.