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All previous wells were cheap workovers or sidetracks of old soviet era wells for Gas and Oil. Agreed if these are the only assets generating revenue this would be bleak.
WRB is a fresh drill based on a modern 3D survey. We are yet to have the results of this drill other than oil coming to surface but drilling muds need clearing with chemicals before flow testing can start. If WBR is a duster, then a raise and probably a new strategy is needed JKT alone isn't going to keep the lights on let alone contribute funds to continue drilling.
So it isnt dead already. Its battered and bruised for sure.
The wells aren’t ‘failing’ they just flow at rates that are sub economic and dribble away to nothing. Slow painful death. This is essentially dead already.
Holy, this company has a history of well failures even when the well is supposed to be an appraisal well of an existing Oil and gas field. So yes for low COS wildcat drilling I agree that you have to accept that you will get a high degree of failures as indicated by the COS but not for the two wells currently targeted. That was the whole point of completing 3D (at expense) to identify the exact optimum location, if either well fails then you have to question the BOD's operational execution competence imo.
Anyway like you say, lets hope both come in and the BOD hit their 1100 bopd target and I imagine that all will then be forgiven.
Cperkin, this is oil and gas - anyone who demands that all stated target aims are always hit 100% should not be investing in this space as it is risky business. Previously I said 700 bopd would be ok by me but since you put words in my mouth 50% delivery on the aim of 1,100 barrels (550bopd) would also still be just about ok for me. This would deliver a revenue of between $10-12 million per annum to Block which would provide plenty of funds to keep the company running and to deliver an additional well program.
Don't get me wrong, I would fare rather see 1,100 bopd and $20+ million a year come out of the two wells than I would half that, but I am also realistic enough to accept that not everything works 100% of the time especially in oil and gas exploration.
I stick to the opinion I voiced here the other day:, as long as the company is still fully funded to drill the second well then they should be allowed to complete the campaign that they raised the money for. and be judged on the combined production from both. However, If they have wasted this money and are no longer fully funded then management have failed shareholders and should be forced out immediately.
Assuming that the second well is drilled and the two well program is completed then this is how I would define success.
1) If they deliver 1,100bopc then I will be praising management to the skies.
2) If they deliver 550+bopd then they have earned the chance to continue running the company as this will provide enough income to enable them to continue a drilling campaign without raising further funds via equity.
3) If they deliver less than 550bopd then they should fall on their swords as new money will need to be raised via placement for further drilling campaigns and I would want somebody else to be in charge for this
So at the moment I am in wait-and-see mode but I am fully ready to call to replace the current management with a different team that have a track record of successfully drilling in Georgia if this campaign does not deliver.
Well one thing for sure he is on his last chance as the dreadful SP performance can not continue for much longer. GL all.
The barrow boy surely has to resign now, everyone including contractors is losing money, market doesn’t trust him
Agreed CP - As an ex self employed small business person if I had only done 50% of the job I would have been paid zero.
Yes agreed Hepseal, they are behind plan, however I don't think anyone will mind too much if they deliver sustained flows of 1100 bopd as per the target.
The question is will they? I certainly can't agree with Holyrollers 50% target of that figure as being good enough (1 well which after all is a sidetrack from existing production) I only wish I could get full pay and bonus for only hitting 50% of my primary objectives through my lifetime, easy money & easy life.
The locations of WBR and JKT have been chosen with epf pipeline distances in mind. Laying surface plastic piping for Gas is cheap and fast. It is delivered in 200M coils and is fast to join.
CP - The problem with the "two months" figure is that if WR-BA and JKT-1 are proved to be commercial they will then have to first construct the two respective connecting pipelines across country to connect to the EPS before commencement of proper production so I would envisage that would take you into the new year. All this against a backdrop of diminishing oil inventory and cash in the bank.
This is what the last placing was for,
Circular issued 12th December 2020.
Pursuant to the first phase of the development strategy ("First Phase"), which is to be undertaken during
the course of the next 12 months, the Group intends to:
x Restart the two existing wells at West Rustavi, WR-38Z and WR-16aZ, to resume oil production
and commence gas sales from the newly commissioned early production facility.
x Continue base production from existing wells in Block XIB, Norio and Satskhenisi.
x Drill one new well under the West Rustavi PSA ("WR-BA").
x Re-enter an existing well under the Block XIB PSA ("JKT-1") and drill a new horizontal sidetrack.
x target an initial production rate of 550 bopd at each of WR-BA and JKT-1.
x Workover of existing well WR-16aZ at West Rustavi, including the installation of an electrical
submersible pump, to target increased production of oil and gas.