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As I understand the deformation now: if you are able to pass the deformation with CT and if you can clean the well bore, this diameter restriction will not hurt, nor reduce the production (perhaps you will see a small pressure loss there only)
For the future: if they are not able to manage to run with CT or another string to total depth, it is possible that we can loose the production from the frac stages, deeper than the restriction.
I read as there being a reduction in flow rates say 20-30% reduction but not a total block of flow rates since they still had communication with the rest of the well bore.
Villamaria, thanks for the youtubelink.
This is my text from 23rd of March:
Ok, now I understand. They say, the casing (or production liner?) is deformed between frac stage 7 and 8
Yes, this can be a problem. For example: If the casing is completly collapsed, zero gas flow would be possible. If the casing is just a little bit deformed, that shouldn't cause a big flow restriction.
But, how do they know it is a casing deformation?
If you have not invested in borehole measurements you do not know much. Perhaps they ran a simple caliper or a lead impression with "on-board tools"? But a caliper only tells you that you have a diameter reduction. Can be a liner or casing damage/deformation but you cannot be sure. Can be anything else, causing a diameter reduction, restriction or even a lock up, hold up. To be sure you need more sophisticated tools and logs. Did we ever get the info that they ran a down hole camera or sophisticated logs with CT or a well tractor in this hole? I do not remember.
After you understood the diameter restriction you will see if this hold up can be removed, repaired or not, or if you lost in the worst case, frac stage 1 to 7. And after that step you can think about production logging tools to measure the production contribution of every frac stage.
After the video: Obviously Org thinks this is a deformation of the casing. Yes, can happen, it is not a well integrity problem (because it is not part of the barrier envelope - good argumentation from this Org guy), yes this deformation or ID reduction of the casing is and can be a future paine in the a^$. If you understand the deformation there are concepts how this could be repaired, removed - but no 100% guarantee that one of the repair try works. If yes, fine, if no, we have to live with this pain as we have seen already.
The latest press release had me go back and listen to when David Close explained the well deformation to the fracking inquiry . Here is a link:
If someone with some operation experience can have a listen from 10:30 to 12:30 and provide their views on the stage 1- 6 being able to produce. Especially with the mention that the coil tubing could could not go through passed the deformation.
Glad to hear that Origin woke up again. As junior partner little Fog can only be the little but annoying pain in the a$%# for Org, because Fog does not employ specialists, who could try to influence, improve the work programs from Org.
In parallel Fog should put some more lip stick on this pig in South Africa now. I think it is not the best idea for SA to use the recently discovered offshore gas to generate electricity. In my opinion SA should use the high rate, high pressure offshore gas for LNG export and use the shale gas from Fog to generate the electricity.
Fog, go for the final double strike Beetaloo&Karoo, endgame and sold.
I was really pleased to hear that Origin has added into the mix for 2021 -- the re-testing of the 11 Amungee fracks. This is being done to determine how many fracks were actually contributing to the 1.1 mcf/d flow rate that was achieved over the 60 day testing period.
We know that there were probably a couple of fracks around the geologic fault that because those two fracks weren't actually right in the B shale zone -- those two fracks were most likely not contributing anything to the 1.1 mcf/d flow rate. This would indicate much better total results in areas where the geologic fault was not present -- especially with a full length 3 km horizontal.
However, what will be really worthwhile knowing is whether any more of the remaining 9 fracks weren't contributing??? If Origin is able to determine that -- for example only 7 fracks were the only real contributors to the 1.1 mcf/d flow rate -- then the Amungee would have flowed at closer to 1.65 mcf/d if all 11 fracks - were contributing. More importantly -- a successful 3 km horizontal in just the B shale zone alone -- could potentially be in the range of 5 mcf/d flow rate -- which is getting into the same range as very successful Marcellus horizontal shale wells. If this is the case, and Santos has more great success with their horizontal right next door -- then this goes a long long way to proving up commerciality as mentioned by that analyst last year.
Here is a link below to what might be one of the types of downhole tools that Origin would have to use to test the actual flow rate at each fracking point along the 1 km horizontal section of the Amungee -- (after they have re-opened the Amungee well and cleaned it up).
Thank you for a nice up to date summary, most of which showed the POQ and the board had a workable plan. A major failing is POQ's compensation was not renegotiated at the 4 year mark. I believe with events and the uncertainties that followed, show the board was somewhat negligent in not going back to POQ and renegotiating his extension, which could have happen, had the original contract included that provision. But the reality is one qualified person could do the necessary journal entries and bill paying( with a second signature as required by a board member(s)). Then, at the appropriate time an accountant quarterly arrive at a smaller office (to be negotiated if possible) and do our required review and later the annual audit. The fact is FOG is in survival mode until the drill bit confirms or not if we have the success we shareholders hope for, or the alternative a tax write off if results fail to be as hoped. This is not rocket science; rather, simply a matter of better judgment by our paid representatives, the board of directors. POODS
Poods, while it is somewhat easy to blame POQ for any failings and long delays we have had over the years with Falcon, -- it is probably worthwhile looking closely at what could have been done differently?? that would have changed our current situation?
POQ was brought in to Falcon by John Craven just over 8 years ago -- with a mandate to sell Falcon's interest in the Beetaloo with a compensation package that was based on an expected four year time frame. The moratorium was the first major change in that time line, and then there were numerous Origin delays; horizontal well failure; further delays with Covid; and now limited flow rates from a high salinity 117 well.
When POQ took over running Falcon -- he very quickly changed the landscape of Falcon's future -- by rejecting the ridiculous Hess ultimatum and very quickly securing deals with Origin and Sasol that put Falcon in a significantly better position. POQ then had to renegotiate the Bruner legacy of Overriding Royalties that would have killed the Origin/Sasol joint venture completely. POQ successfully reduced the ORRI's down from 12% to only 1% -- with an amazing Origin requirement that they would have to pay for 70% of that expensive reduction in the ORRI's.
POQ was travelling almost non-stop over the first five years -- gathering over a million air miles . There were numerous trips to Australia, South Africa and Hungary -- as well as many investor presentations in London, Toronto, New York, Houston, Sidney, Vancouver, South Africa and Los Angeles. I attended three of the four presentations that POQ held in Vancouver over those years, and cannot find any fault in what POQ was doing then and what he has been doing since.
It is also worthwhile keeping in mind that with Covid and the current waiting game for results from the Beetaloo -- then is not a great deal that can be done -- except working closely with Origin and keeping pressure on them to make today's announcement of accelerated exploration programs. There is little value to starting another dog and pony show with the big investment banks or potential buyers -- until there are some good results that show a clear path to commerciality. POQ has already made those presentations to thousands of investors and big brokerages around the world, and without something new to show -- any expensive travel would not be a wise use of Falcon's cash position IMHO.
What explosion? I sure don't see it, but am almost done having added another 500k shares. I put a call into Ann and POQ both and most probably will not hear back. But, if I were invited to the board, it would be with conditions that among other things would improve some things. We have no control over what ultimately may be down the hole, but as shareholders we have been abused and we are not amused at all. We have a relatively expensive farcical board in my opinion. POODS
I was thinking that although origin isn’t interested in helping w Falcons sale, they may be interested in helping their potential farm out??
James and Longknife, This update from Falcon is really welcome news, but since this is Origin's plans for the 2021 drilling program -- I doubt this has any real input for a potential sale as Origin is not particularly interested in helping direct Falcon's sale. However, any good commercial indications for any one or hopefully all three 2021 exploration wells will certainly increase Falcon's prospects towards a future sale.
If the Kyalla 117 well cleans up and flows unrestricted, and the results are as good as the data and 17 hour flow test have indicated -- then Origin will come back in next Spring for at least one full 3 km horizontal to test commerciality at that location.
The Vertical DFIT testing on the Velkerri flank should give fairly clear indications as to whether the Verkerri wet formation that Empire has shown to exist --- carries over to Falcon's 76 permit area on our eastern edges.
The Amungee re-test is very interesting -- as there were indications that more than the two fracks located next the geological fault did not contribute to the 1.1 million cu. ft. per day discovery. If the Amungee horizontal only had around 6 fracks contributing out of the 11 fracks completed -- then this would a fairly significant improvement for any future commercial wells and give the Amungee a better comparison to what Santos has found next door??
Trading Volume has really exploded from this RNS.
I’m wondering the same. ESP as their are no plans to dig addl Kyalla wells which make me believe that they are not confident of cleaning that well up....or they ARE confident and would like to have all three regions represented for a sale? Idk and am no expert.
Looks like we doing some things in parallel, which is fantastic. I suspect that is result of the government pitching in 50 mill, possibility of the sale in my view have not changed. If napkin deal has been completed or not, flow numbers and resource estimate is the key.
Looking forward to reading the comments on this forum regarding this RNS; I am not geologist. I find it interesting that part of the 2021 work program is to perform a production test at Amungee NW 1H. Depending on the degree of success, would this possibly suggest we're getting closer to a possible sale?
Fri 19 Mar 2021 07:00
Falcon Oil & Gas Ltd.
Planned 2021 Work Programme - Beetaloo Sub-Basin
19 March 2021 - Falcon Oil & Gas Ltd. (TSXV: FO, AIM: FOG) is pleased to provide details of the 2021 work programme in the Beetaloo Sub-Basin, Northern Territory, Australia with our joint venture partner, Origin Energy B2 Pty Ltd., a wholly owned subsidiary of Origin Energy Limited ("Origin").
The 2021 work programme is expected to include the following:
Resume clean-up operations of Kyalla 117 N2-1H ST2 ("Kyalla 117") and commence an extended production test ("EPT")Drill Velkerri 76 S2-1 vertical well ("Velkerri 76")Perform a production test at Amungee NW 1H
2021 Work Programme Detail
As announced by Falcon on 19 January 2021, Origin submitted a notification of discovery and an initial report on discovery to the Northern Territory Government.Unassisted gas flow rates ranging between 0.4-0.6 MMscf/d were recorded over seventeen hours, which are preliminary indications of well performance, and an EPT is now required to determine the long-term performance of Kyalla 117.
2021 work programme includes:
Resumption of reservoir clean-up operations using an artificial lift technique.If the Kyalla 117 clean-up is successful, progress to an EPT.
Targeting the Velkerri play along the south-eastern flank of the Beetaloo Sub-basin, which is predicted to be in a liquids rich gas window.
2021 work programme includes:
Drill a vertical pilot well to acquire core and log and run diagnostic fracture injection test data across the Velkerri.
Amungee NW 1H
On 22 December 2016 Falcon announced that, following a 57-day EPT of the well, production averaged 1.10 MMscf/d.On 15 February 2017 Falcon announced that Origin had submitted the Results of Evaluation of the Discovery and Preliminary Estimate of Petroleum in Place for the Amungee NW-1H Velkerri B Shale Gas Pool to the Northern Territory Government amounting to a gross contingent resource of 6.6 TCF, 1.46 TCF net to Falcon.
2021 work programme includes:
A production test to be carried out to determine if all frack stages contributed to the initial EPT conducted in 2016.
Philip O'Quigley (CEO of Falcon) commented:
"This year's programme covering three different plays in the Beetaloo will provide key information that will help determine the future appraisal and development programme. The prospect of multiple positive results is exciting, and we look forward to providing these results as soon as they become available. Falcon is fully carried for the 2021 work programme costs."
Falcon Oil & Gas Ltd. +353 1 676 8702
Philip O'Quigley, CEO +353 87 814 7042
Anne *****, CFO +353 1 676 9162