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"The organic-rich shales of Mongolia are thermally immature near the surface, locally forming combustible oil shale, but reach oil maturity (maximum Ro of 0.8 to 1.0%) in deeper areas ranging from 7,000 to 8,000 ft."
"Within the 4,690-mi2 high-graded prospective area of the Unegt and Zuunbayan troughs in the East Gobi Basin, the Lower Cretaceous Tsagaantsav Formation contains an estimated 300 ft (net) of organic-rich lacustrine shale at an average depth of 8,000 ft. TOC averages an estimated 4.0% and is oil-prone (Ro averaging 0.8%). "
* 55 TCF (gas). * 85 billion barrels of risked shale gas and shale oil in place, * Oil gravity averages 28° API
Maybe I'm being naive but I'm thinking they can drill this to target depth without an RNS or a leak. And then announce news on completion as the RNS said. Significant volume should give away any leak either way.
Great post. Agree with what you outlined.
I think they should encounter Oil shows in the deeper zones. Does not mean there is no Oil from shallower targets. Both could be Oil bearing.
The US EIA report that I looked at pointed out that deeper zones are more likely to be Oil rich and specifically quoted 8000-10000 feet (i.e. c.2400 to 3000 metres). On my phone...so don't have the exact content. Will post bit later.
Great post. Just today I came across a video by Shell showing the drilling process.
Excellent watch to gain a better understanding of the drilling process. Will post the link later on.
Yes, mostly what you covered is in that you tube video, size of drill bits, casing, cementing at diff levels, etc.
It's not a straight through drill. Multiple stages involved.
With the rich oil burning outcrops in Block 5, statistically speaking we are more likely to get at least an oil show.
Edison Research stated that in the Wildhorse and Fox wells, if there is some oil, chances are high that they are going to have more shows at various depths. Of course the inverse can happen as well.... no shows up top would mean way higher chances of no shows below. We have outcrops soaked in oil in Block 5 for SL and Fox. We have live oil shows at a lower altitude at the Fox drill (oil flows up).
So basically, this is pretty solid. Of course the SP will fluxuate, but if you buy for the asset, the management, and the industry outlook, you can't go wrong.
You already have some chinese buys coming in (presumably... noted from previous posters and the buys with 66). Probably means a little bit of family from some of the drillers decided to buy in. Considering the timing, it was probably around the turbidite strike. All hearsay and precision guesswork, but positive nonetheless.
If this is a "duster", it will be after they put the well tester to work and find commercial feasibility. Because statistically speaking, we will have oil shows. Unless the rig burns down (unlikely), we should at the very least be at above 10p with oil shows (because IMO 10p is still waaaay underpriced)
IMO stop losses should only be used in stocks that have high volume and market cap that cannot be manipulated as easily. A cheap price for a great asset and a solid management team with tremendous industry support is probably the worst time to sell. But hey, your $$££ your decision.
understandably they have been a little vague, first drill and all, multiple zones, follow up wh drill, in the gobi desert. fair enough id say. what an opportunity this is. agree with their conservative approach, under promise and try to over deliver.
75mpd is conservative IMO (assuming access to all rig and pipe requirements are easily to hand) that includes casing off whichever sectors look good on the logs. So first zone is water table depth and then cased so they can then switch from water to mud, get through first potential zone and case as appropriate, second bonus zone and case or continue etc. From other drillers experience at this stage it appears they case off potential hydrocarbon zones so they don't get wellbore washout and that would mean the hole is too sketchy and could mean they cement it up and hinder fllow later on when perforating any potential zone. So ideally you have a drill case through a zone with layers of net pay behind a tidy cased section on pipe and cement. You dont want to drill through a potential payzone without casing it or your mud weight and pumping will potentially screw that payzone. With two real targets and multiple bonus zones you ideally start off with a big rig and large casing so you dont run out of pipe width and compromise drill bit size when your deep in the key target high pressure last leg.
I'll go a little further,sea beds where millions of years ago,sea life and decay,basically created the oil and gas that gets trapped in the higher pockets,within different formations, as these where sea beds left after volcanic eruptions,knowing they exist, with water beneath, the way I read this is the oil staining proves that trap exist higher up,so early on SL should deliver, but who knows,but exciting.
BGG,did a small bore cut down to around 1000 meters,away from marked traps,in the TUG RUG,what they were looking for was evidence of oil staining,they then planed to drill Wild Horse,and Snow Leopard, with the record BGG had the most successful British company in recent years,accredited with 17 oil and gas discoveries,and they were looking for billions of barrels,best chance that has ever happened, especially with 100% of the find,to Petro Matad.
Oh,expect also as we get down nearer TD,panic,from the negative spin brigade, they want this SP as low as they can frighten small investors off,SM123 (I'll be derisking soon).as TD gets closer buying in,is more like it,I've been around too long to take any notice.
Bpc was down around .5 of a pence in December of last year and was the board dire at the time or what..!!! Well that was the time to buy; even screaming it at the time but you do need to have a bit of faith in such moments
Never thought that investors who consider themselves as a market guru could be in such a desperate and panic state. Tranquility, excerpt and excellent weekend to all our true Matadors. Please do not forget the time works for us now and very soon the whole situation will change in our favor in the most magnificent manner.
Hi Ojay, Well, we've already had one Firesale from 13p to 8p and unfortunately I cannot see an end to this selling as the volume has been very low in comparison to the 1st placing ,and thus not able to soak up the sells without being marked down.The market in Matad simply could not take another large placing without severe consequences to the sp, and the Flippers may well still have 10's of millions of unwanted share to sell ( at any price) and thats why the sp's falling.
I suppose the danger now is that due to the lack of volume - some flippers will still be left in when the 1st duster's announced and that could seriously exacerbate the expected fall or stifle any rise,if the drill hits oil, but fair play to the market makers, they have dropped this nearly 40% now and it's been a smooth, steady decline in nice little increments, (well,apart from the initial big drop on the day the devastating 2nd placing was announced).
So they have maintained an orderly market in a potentially volatile share and facilitated all buys & sells with minimum disruption,sadly,they are the only winners.
I'm as gutted as anyone,but this is the Wild West of the Investment world and we always have to expect the unexpected- so yes, I will be derisking soon.