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Newt,
My point is prices in NY and Montana have very little in common and one has nothing to do w the other. It seems that Oleo is saying the same thing about the multiple sections of the amungee.
Good post Longknife, as I agree that neither Falcon nor Origin would deliberately put out any flow rate that wasn't backed up solidly by the company they hired to run both the equipment and and analysis of the restricted flow rates before and after the casing deformation. However, your "equivalent" comparison to REIT's in NY and Montana is pretty hard to interpret -- LOL.
Oleo,
I always appreciate your posts and your expertise- thank you. I am concerned that you are saying that Falcon and Origin are deliberately misrepresenting the amungee extrapolated flow rates. I don't believe that either co would not know how this works or perhaps there was language in the release to protect them, but if not, this would seem to be a major effort to defraud the stockholders. An equivalent would be a REIT saying hey we get $2500/month for an apt in NY so we should get $2500/month for the new prop were building in Montana.
Pleasure
But sadly it does not help us to get Fog sold for one or couple of dollars per share :-(
Oleo thanks for the insight. I’m sure many on the board appreciate your thoughts. Sorry I mis-stated the 5mmcft/day language.
Tnbird,
Before I repeat my old comment. Be careful with the oilfield units. 5 MM cft means 5 million cft.
IMHO the 5 MM cft per day calculation is not trustworthy!
First, physics is wrong.: You cannot say if we get 1 MM cft /d from 200 m, than we should get 5 MM cft/d from 1000 m in a horizontal well because friction loss, pressure drop etc. work against this simplification.
Second, geology is always full of heterogenity , that means if you have a certain geology, mineralogy, stratigraphy etc at 200 m, the other 800 m will never ever have the same geology, mineralogy, stratigraphy etc as the 200 m. And that means the reservoir parameters which deliver the production rate will be different for the 800 m. So second, the geology works against this simplification as well.
If you have 2 producing horizontal wells and you want to compare them, then it is possible to say well A got xx cft/d/m and the other well B got yy cft/d/m (here I mixed up oil field and SI units and m means meter). But you should not present calculations as Fog and Org.
I do not know if Fog does not know that, or if they know it and sold it to investors whose field of expertise is not reservoir engineering. And it becomes worse when a company as Org echoes this 5 MM cft/ d bull$hit.
Oleo
What are your thoughts on the recent Beetaloo Amungee flow rate update to 5 mcft/day??
Yes, that's the one.
So that was an unstimulated test? Wow, ...that's even better than I had remembered!
jmo
Unstimulated: means no acidizing, no hydraulc fracturing job
"shows. One of the wells, drilled in 1968, had an unstimulated flow rate of 1.84 million cubic feet of gas per day from fractures. 'The acquisition of the permit gives Falcon access to another potential unconventional energy basin and an additional option for Falcon's exploration portfolio,' stated Marc A. Bruner, CEO and President"
Unstimulated, vertical well in SA, and now compare to the vertical 0.364 million cub feet per day well in the Beetaloo from recently.
I've been involved in Falcon since the Foldeak days myself. I recognize some of the names on here from the old Agoracom board.
I'm still highly optimistic on the Beetaloo, and believe that further exploration and appraisal will continue to prove-up this world class resource.
As for the South African acreage, I seem to recall that years ago, another explorer did a relatively small frack on a simple vertical well, somewhere in or close to Falcon's Karoo acreage, ... and at least initially it demonstrated something around 2 Million cubic ft/day of gas, which is highly encouraging.
Perhaps some of the long timers will remember the details?
jmo
The Mako in Hungary is not very attractive. Deep=expensive wells are needed. The wells are hot and you get problems with the temperatur stability of the used chemicals for hydraulic fracturing. I discovered Fog, when Fog started to drill there in Hungary with Exxon and I was very curious about the results but shied away when the first news were published about this tight gas play, basin centered gas accumulation. I think the gas market in Central Europe is perfect and there was a fair chance because a company like Exxon farmed in but finally it was a duster and Exxon left.
But I always liked more the Karoo in South Africa and the Beetaloo in Australia. Currently we do not get the best results from Australia and I become not nervous but a little bit worried. A vertical well with an initial flow rate of 0,364 mmcft/d is a candidate for the Halliburton cement truck, for plug and abandonment. This well did definitely not hit any sweet spot in the Beetaloo. I would not exclude with 100% that a horizontal well (with how many frac stages?) could produce some gas there but the chances are much better to get a horizontal well with very good flow rates when the vertical well got already a good flow rate.
In the E&P business it is always good to have a contingency plan. Back in the old days the Karoo was the number one choice for Fog. But we had political troubles in SA, turned away from the Karoo and went to the Beetaloo in Australia. Perhaps the chance in the Beetaloo to produce hydrocarbon condensate attracted Fog as well, because gas fields with condensate earn much more money. So the Beetaloo was something like a more or less successful but ever lasting contingency for SA. With today's postmark I get worried because in the Beetaloo we have not seen any commercial flow rates which can create a share price of 30, 50 pence immediately. We have some more carried wells there but we need at least one well with commercial flow rates within the Fog concession or at least in the neighbourhood.
In the mean time the situation has changed in South Africa. There is not enough gas in SA, they have blackouts there and it is planned to shut down the old coal power generation stations. Mining , fertilizer etc companies and even Sasol are worried that they do not get enough gas in the future there. And I hope that Fog starts to reanimate the Karoo that we do not crash completly, in the case a commercial flow rate cannot be demonstrated in the Beetaloo. The world has changed when a South Korean steel company thinks that it is a good idea to buy an oil and gas company. And in such a world it should be possible to find a farm in partner for the Karoo as well to get the next steps financed in South Africa.
Yes, it was certainly challenging. However, basins often take many years of trial-and-error, along with advancements in technology, before explorers are able to 'crack the code'.
The first step of course is to have sufficient quantities of hydrocarbons present, which I think has clearly been shown at Mako.
Therefore, given the favorable 'macro' set-up we find ourselves in today, I was just wondering if Falcon and/or some other entity would be willing to give it another go.
jmo
JS490, I am fairly sure, if memory serves correct, that even though there was clear indications of lots of shale gas in the Mako -- the majority of that gas was in primarily in a sort of sandstone formation. Even though that formation was up to 1000 feet thick in spots with lots of gas indicated -- that sandstone formation didn't lend itself to fracture stimulation as there was less than ideal propagation potential from fracturing of that particular formation.
While lots of gas appeared to be in place the fracturing of that formation would have resulted in some form of collapse of the compressed sandstone for very minimal flow potential. That was part of the reason that Exxon was drilling way past the sandstone layer and hoping to hit a more frackable rock structure deep below the sandstone layers, but ended up with the deepest and most expensive water well in Europe.
The mid-Velkerri by comparison (and similarly for other successful shale gas deposits in the US) is a much more brittle rock structure that allows the fracking process to send out long fractures in the rock surface that are held open by the tiny pieces of rock in the stimulation mixture injected under very high pressure.
I realize this is completely out of left field, given the understandable current focus on the Beetaloo ...but I wonder if any further significant activity will take place on Falcon's Mako acreage in Hungary?
While the previous testing results were mixed to disappointing, we know that there's a VERY large volume of gas in place, which was demonstrated to be 'moveable'.
Technology and techniques (drilling, completion, testing, etc.) for unconventional formations have advanced since they tested the Foldeak with Exxon 12 years ago.
There's areas and formations at Mako that haven't been fully or adequately tested yet, ...and again this is in light of the advancement of industry knowledge over the last decade-plus.
Given this is on land, in Europe, and coupled with today's tight supplies and high prices, ...perhaps Falcon/potential JV partner(s), would be willing to go back and give the Mako another look?
jmo