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Thank you very much for your response garrym79, it helps me better understand what has happened.
Pt2 Now the discussion id flowing with lots on interesting and alternative thoughts....my impatience meter is now on 11 ;-)
Well at least we have something complex and interesting to look forward to.
Everyone has always expected the drill and flow test to re rate the share price but maybe it'll be the next RNS that provides us with a huge resource and maybe even rewrites the NPR-A plays that us and others should be looking for...
Time will tell GLA.
08.07 - Thanks for you thoughts Garrym , always interested in alternative and structured view where I might have been making assumptions. I fully accept that I may well be off the mark as I've learned from RNS, the more information the easier it is to take your first understanding and not see the subtleties of the language and technical information given also harder it is to cross compare to pre drill presentation...So to be clear I am not saying I'm right, its just my take.
I guess I got to my thoughts based on the following.
1. In the preamble presentations to the drill they talk the 3 main targets, N20, N18 and N14. Former 2 were hypothesised to be analogous to Willow and last commonality to Harrier.
1. The N14 was the deepest target and we didn't go material past total depth. This is hypothesised to be on the Harrier Shelf break and therefore a Harpoon analogy. I believe from this, I'm taking this as the deepest target 88e discuss and one which wasn't test due to the operational issues.
2. The Surprise zone from what I can gather sits above N14 somewhere as that also couldn't be tested.
3. Other prospective zones higher up could be tested and were low saturation.
I've read over the 3 past RNSs and can see why you have the opinion that we can't fully understand how the actual results map to the pre-drill presentation.
However a couple of bits of information, maybe not definitely, point to the N20 and N18 not being as good as hoped -
- They have indicated that depending on map/remap Harrier might up high graded for 2022. You could easily argue that its efficient to do that anyway with encouraging results from Merlin, particularly in the N14 to get a step out understanding and in the event the surprise zone maps up to Harrier also. This is not saying Merlin -1 wasn't great because if the N14 and another zone are that decent then its still a result...I don't care if they don't find good results in 'Primary' targets as long as they find something good in something!
- I'm with you that I suspect the surprise zone, really is that if they are surmising that this prospect hasn't been targeted in the NPR-A before...(remember thats a statement covering not just our land but a number of other companies and wells). I like the Torok idea, especially after the understanding from Charlie-1 ie gas and condensate given the additional burial event and also the PANR presentations speaking to their hypothesis of more oil bearing in the Torok at shallow depths. If the surprise zone does look like it could be torok in the NPR-A That to me sounds like a major information discovery that I'm sure would hold interest to many other explorers.
I also concede I might have been a bit swift to write off the N20 and N18 target, although if I have to make a call, I'm still sceptical of them given it would appear the shallower drill targets where the shallower results were the less encouraging the results.
Now the discussion is flowing with lots of intere
Thank you for your posts garrym. VGLA
08.07 - I’ll respond a bit more shortly. Just a quick note. I corrected point 3 to read N20 and N18
my thoughts below your numbered points;
1. The bottom zone is the N14 (a Harrier target)
-I don't see enough detail to state that. If you mean as it was already a target overlapping Harrier, then maybe. Their seismic led them to conclude which were named targets and which ones opverlapped. I think any new payzone they drilled will require some re-evaluation prior to stating it extends below merlin and harrier. These new zones, they will need to link them to Nanushuk or Torok or indeed, a new system (laid down over geological time), generally the rocksniffers have a timeline to enable them to call it Nanushuk or Torok, or something new. They will be busy re-building this puzzle.
3. N20 and N14 - sounds like it didn't hit the spot given Willow.
- I need more coffee and to re read, not sure how you get to this conclusion.
They show us N14, N18 and N20 so where are all the other N Nanushuk numbers? I could be N15 or N16 where they found oil, for some reason they stated N14, N18 and N20 were the targets, a few surprises for this company. For sure, next few weeks or months we will get an RNS stating where we now are.
They stated to use the well to perform a well sidetrack, there exists a prize and imagine their frustration at having to pack up and wait a year. New sidetrack required as wellbore clays now unstable. Sidetrack well, perhaps drill to 3300 feet and set 7" casing to isolate the non productive areas above and potentially problematic zones. Now when they drill a 6" hole from 3300-5300feet, that production zone will be disturbed for less time and may remain stable long enough to execute the original 5-7 days wireline programme.
RNS does state that geological chance of success is now significantly increased in Merlin 1 and IMO subsequently Harrier,
I think we have to wait on 88E lab work and re-modelling of all their new data into a new RNS for us like the image on page four of this;
No need to apologise, to many on here are disingenuous. Your posts speak for them selves, and that’s not me blowing smoke up your back side pal lol.
Look at the hassle i got, when i called out some on here just for saying imho and view that the sp will retest and or break the 1.5p support...proven right of course. All i was pointing out was to be mindful of the elements that could and would drive the sp up or down and just be ready for the reversals...the volatility with 88e when nearer results gets extremely hectic and hard to call, although some on here would be ****y and say they got in on the dips and sold on the tops..every time, yeh right.
Have to say now that some dust is settling for now, the quality of posts by the regulars has been spot on..and it is Reassuring that we have a broad spectrum of people posting their knowledgeable insights in highlighting the pros and cons in mitigating the risks while highlighting the technical aspects of potential new prospects TBC.
17:33 Sure LSE have had to buy a new cloud for my filter list, but only one green bar today (so far) and lots of decent posts and comments, long may it continue :-))
Yours, rodrod1, are far from drivel. However I've never had such a huge filter list for a share (despite some of our previous encounters!)
I apologise for my drivel :)
@garrym79: absolutely love these objective, detailed insights. Thank you.
After a few weeks of drivel its very welcome.
11.49 - Worth noting that finding a good target and having operational issues is far better than not finding what you want but it being operationally sound...for obvious reasons. You can fix any operational issues next time but if the oil isn't there then thats forever! ;-)
11.35 - Very much appreciated my side....and anyone who applies reasonable and rational intelligence to the board...
Thank you very much Garry, I know you are a reluctant poster at times due to comments made by a few in the past but I am sure a huge majority appreciate your posting and of course we can always use your posts as a platform to research to increase our own personal knowledge.
3. should be N20 and N18
Thank you for a return to realistic, detailed conversation.
11.35 - Thanks Garrym, very helpful and aligned to my way of thinking.
PANR have had similar issues in the Talitha after a forced stop....only difference between them and us was time. Whilst disappointing, we had to buy XCD, plan the well, find a FO partner and then got caught within a left field political stunt...we have to accept we've, net, done an amazing job to get to where we are with Merlin given the challenges...the fact it also looks like it could well be a winning is really amazing.
I think your last comments point to what I think, being:
1. The bottom zone is the N14 (a Harrier target)
2. The surprise zone is....a surprise and needs remapping to see if that is likely to be at Harrier (company thinks so given their statement about it extending across the acreage)
3. N20 and N14 - sounds like it didn't hit the spot given Willow.
Conclusion in my mind is high grade a Harrier drill for 2022 and use that as the step-out, or as I've said before - step-in given N14 is actually a Harrier main target, (maybe with a visit after to sidetrack and flow the lower Merlin targets. (ie a reverse of this years plan).
Thats before any consideration too Charlie-2 or what might be targeted for the SMD and Kaparuk in your central leases after debrief of Talitha well.
There is sooo much positivity to look forward to if people can adjust their vision a little further upon the road...
Are you inclined to agree?
NMR tool indicated good mobility across most of these zones.
The reservoir has permeability (it will flow)(they use the word reservoir so it stores stuff)
oil signature in the fluid using an optical fingerprint sensor
Multiple prospective pay zones in sandstone reservoir between depths of 3,400’ and 5,100’ have been identified; however, more analysis of the data is required to determine gross and net pay.
Almost 2000 feet thick gross ‘payzone’ we just need to know the net pay (data data data) which we can only determine from drilling/lwd/wireline/coring
The word ‘pay’ the zone will pay us back.
Flow testing can give flows close to calculated values and can help determine distance to faults. NOW if the sandstone has fractures in it, the flow tests figures get higher ... more $$$
They know what they have found, they state they will use the original well to sidetrack from, so they know it is worth going back to. Options; isolate everything below 3000feet and perform a sidetrack from this depth if all formations from 1512-3400ft is stable
Slugging of hydrocarbon and water then occurred, which is often a precursor to hydrocarbon flow from the reservoir (reservoir flows)
Only operational problems, not finding oil problems.
Hole condition, from 1512ft to 5267 feet is open, claystone is time dependent, once we made the 8-1/2” hole through it the clay will be absorbing fluids from the drilling mud and becoming unstable. 88E effectively re drilled it (clean out trip) after the wireline, but it will just keep self destructing. NOW a big question, will you get your 7” liner (casing pipe) through it and successfully cement it all the way back to the casing shoe at 1512ft??? To flow the well the plan was to line the well, perforate and flow each zone. Without a cemented liner the flow test will be tricky (zonal communication)
First wireline run touched the cylindrical wellbore effectively, second run couldn’t. So I’m thinking the ‘clean out’ run where they re drilled out the bad condition hole has become enlarged where we needed to test. No point over thinking this part, whats done is done. Sandstone can be very friable but it does sound like the clean out trip contributed to lack of second test.
From Shallower zones; Fluids recovered via downhole sampling will now be sent to a laboratory to determine hydrocarbon saturation, phase and constituents; they, however, are deemed to be mostly comprised of water.
09.22 - thanks Garrym. Would appreciate your further thoughts on the RNS.
Without having direct industry knowledge I have spoken to my contacts. Whilst disappointing, they all said the operational issues are quite normal. They also said it would be company suicide to say this is the best we’ve seen without knowing the data they have can be used to independently provide a very positive analysis RNS. We have the first run wirel line and can certainly get a good understand of certain characteristics plus a remap of the extent of the new zone...given where we are the next RNS is key
the power cut would have been the wireline units power system. Our well like any well is just a hole in the ground which the wireline team arrive at and throw their equipment down. Wireline are self sufficient, they just need fuel, food and a place to sleep.
Rigs do have power cuts also, can be avoidable by having preferencial trips (turn off the heating before the pumps etc) and sequential starts (after a blackout, turn on essentials like air compressors, fuel pumps first etc).
The wireline equipment was stuck in the well, perhaps caused by powercut and standing still. In the 8-1/2" hole they had 4" tools with wheeled legs (point your elbows out - wheels on elbows, you are the 4" tools) anyway, the claystone can swell and collapse when opened and left for days, then sandstone smothered in thick drilling mud 'cake' is also sticky when the weight of drilling fluid is higher than formation pressure (differential pressure sticking - tools are sucked against sandstone) so it is high risk for 88Enenrgy to say 'lets do another wireline run' once bitten, twice shy etc. In my mind, when I read the ANN on Monday evening I was happy enough with the oil find but knew the SP would tank. My quick thought was they had seen enough, have their plan B in the background and decided not to risk millions of dollars (share holders cash) on lost wireline equipment. Other thoughts were, to free the wireline they would have pulled hard on the 5200 ft long wireline cable... damaged cables, couldn't continue... who knows. The wireline cable is stronger than the weak point 'rope socket' at the top of the wireline toolstring. Now if we had left wireline tools in the well, the law requires you to make several attempts to recover them when nuclear sources are used (more cost - working time available etc). Perhaps us shareholders should be thankful 88Energy have not left behind a train wreck to fix next year.
This is well known in the oil industry, big customers like BP and Conoco are sent the good tool package and best men, small one well a year outfits like 88Energy get the left overs, just a fact of life and good business sense.
Well testing wise, I had it in my head that the well test team would finish at PANR and come over to us, perhaps PANR had delays, meant no men or equipment for us? Been busy this week so I have not had time to over think this one.
Us long term holders have to be honest with ourselves. This is the oil exploration game and there is absolutely no guarantee of success - quite the opposite really most small cap oil explorers fail. So it could be argued we've done quite well to be where we are now. We have to take responsibility for our investment/gambling decisions.
But let's be honest in allegedly "the most oilest place on earth" 88 energy hasn't had the success we all hoped for after multiple rolls of the dice. Thus far they haven't been able to prove up even a single cubic nanometre of oil or gas.
But we do have inhouse estimates of '1 tcf of prospective gas' and other potentials. Lots of potentials and prospects but nothing proven as of yet. We've had suboptimal drilling positions, no horizontal drilling and power cuts (no back up generator?).
We haven't proven up anything yet. So how valuable are our assets? How much would any interested party be willing to pay for these potentials and prospects that they will have to prove up themselves? (These are genuine questions and I am very interested to read people's thoughts on this)
At the moment I lack confidence that it would be for many multiples of the current market cap but then again I'm not privy to the data & I'm no oil and gas expert. I'm happy to be proven wrong.
On the plus side, this time around as of yet we haven't collapsed to sub 1p share prices. Then again past performance is not indicative of future results. I do wonder if the market is giving us a fairer valuation compared to previous years. Perhaps 1.xxp is the new suppressed share price.
The US market adds a new dimension to things and I believe they have the potential take us to the next level. Perhaps they already have. Of course us lay people don't know whats going on in the background. We still may be greatly rewarded by holding onto our 88 energy shares - or not.
This company can drill anywhere in there acreage and revisit any previuosly drilled well and it will always be he same reaction.
If they succeed they make even more money if they fail they continue to draw there fat wage packets.
We the small investor are either lucky and have sold or unlucky and held.
Nothing strange at all.