The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
SvS - quelle surprise - no answer and retreat to citizen smith stance!
i can have an opinion on nuclear fission, but if a nuclear physicist made a statement i would defer to his take
BPC are geologists and oil men, yet you do not defer to their understanding of their own play!
anyway - your position is noted and agree lets no go there :)
Hi ShouldveSold
It must be the elusive chromatically challenged person in the wood pile now there is some politically incorrect verbage
Bohemia
My take is that its the % probability of 2 individual events as individual values
the average for them combined is just as per CoS calc assigns
as migration isnt a seperate value - if it was then it would be 30% overall as 1x1x1x1x0.3 = 30%
or put another way average of 4 and 2 is 3
its not 100% x 30% = 30% as you maintain, as thats not assigning any value to the Source at 100%
All im doing is interpreting the data BPC have shown us where BPC assign a green - i.e seal is in place -
As to application elsewhere - remember this:
"in the event of success, Perseverance #1 would substantially de-risk the total B structure, which extends for between 70 and 80 kms, has a mapped areal closure of over 400 km2, and has a 'best estimate' aggregate recoverable resource potential in excess of 2.0 billion barrels"
And they had a drill that was 80% successful by CoS criteria
SvSS
“the Saffron discovery has already been proven”
Sort of. The first well produced 25-50bopd. Another of those is not going to add much value.
Kevin, the Saffron discovery has already been proven. We are in field development stage not the exploration stage.
What are the chances of a successful find of saffron 2
10 percent?
1 in 10 chance
Anyone know
Who un-recommended my post when I owned up to being sarcastic???? Show yourselves !!!! This unconstitutional and against the BB code.
Great work and analysis Tiburn, fantastic. We can only hope that the carrot is dangled and it attracts the attention and we get some positive news on any form of tie in, farm in, licence sale. Just anything and I hope Mr Potter doesn’t get greedy. Fingers are very well crossed for a brucie bonus but I have given up on it being a cert! Great work though!
"So average for the calculated source at 100% and migration at 30% = 65%"
When you calculate the probablity of two things both happening, you multiply their %s, not average them. If West Ham have a 50% chance of finishing 4th and thereafer a 1% chance of winning the Champions League, actually finishing fourth (raising qualification to 100%) wouldn't make there probability of winning next year's CL 50.5%.
If you want to use 100% for source and 30% for migration, the maximum compounded CoS is 30%.
Moreover the other 100%s you use are not reasonable. We have (presumably) seen that there are reservoir and seal in the Aptian. You could say that the "play probablities" for this are therefore 1.0 and 1.0 instead of 0.9 and 0.8. But, just like P1's risks were slightly higher than the play overall, no individual prospect will have 1.0 like the play: there is always the risk that at a different structure the same reservoir sands are not adequately developed or the trap is breached. But even that analysis is completely overshadowed if they next target Jurassic horizons: they haven't done anything to raise the probablities of seal and reservoir in the Jurassic.
We both know where this debate will end so rather than re-visit that destination, which I am sure isn't fun for anyone to read. I'd rather protect this level of acknowledgement where we can all make our points, choose to agree or disagree without getting personal or holding grudges because of whatever beliefs.
Just because I may disagree with you or Starchild on various points that doesn't mean I dislike or think anyone is a silly for the opinions they have if its backed up by reasoning.
P_I knows his place Tiburn
Tiburn: Perhaps you should drop an email to BPC suggesting they emphasise in baby language to PIs what you covered in your last few analysis posts. If it impressed SvS, I'm even more impressed. (and apply for a consulting role at the same time!)
I suspect a new CPR will be issued for Percy-1 to get an independent perspective.
GL
Starchild
Thanks Star - they just need a bridge between Geos, big business approach to translate and emphasise, they have some great data and if it had been packaged better we may have had more positive sentiment - I can provide consultancy services at reasonable day rates to BPC if asked!
This is genuine work Tiburn. You have managed to derisk & prove the Bahamas basin model, raised the CoS to 65% of discovering OIP & in commercial quantities.
No Oil Major has been able to do this to date, not even BPC has released this as official news. Its outstanding work and I think BPC would be lucky to have you as an employee.
I am looking forward to a broker note upgrade, an increase in market sentiment & significant increase in company valuation based on your findings.
You have certainly restored my faith in the Bahamas licence.
:)
Separately; the code 1 trade last week has not transpired to have any meaning. Has this debunked the belief for anyone?
So P#1 position rationale was as follows:
"This location has been chosen, based upon high resolution 3D seismic data, as the best balance of lowest technical risk, geological conditions and recoverable volumes at the crestal point on the northern segment of the very large B structure."
As they were trying to establish all the parameters
Trap
Seal
Reservoir
Source
Migration
It was a balance - Geo, tech, cost spend, enviro risk management.
But these risks have been managed - they have proven its possible to drill in Santaren channel, at reasonable cost and time, safely and established a WPS.
So next drill positioning analysis will use these findings as proven and focus more on one aspect which is where the oil has migrated, so one focus area instead of trying to achieve 5 simultaneously, having to make accommodations, balance risks.
It explains why BPC were pretty upbeat in RNS, the drill was a technical success when 80% of their targets were met and the Jurassic play was proven. Its why Majors will be upbeat aswell.
The comms needed to explain this better or emphasise these aspects in a focused/exec summary manner, spell out the nuances as this is such a complex sector, yet here we are two months later.
But they are writing their RNS with Majors as the target audience, so they see no need to simplify, assume some knowledge of your investment and its sector.
PI understanding is irrelevant to BPC, as is current SP and sentiment to them.
They have much bigger fish to fry and that is securing a Farm out, then PI will benefit.
Thinking further on the revised CoS calc from slide 28 in presentation, bottom left table
Trap - 100%
Seal - 100%
Reservoir - 100%
Source 100%
and Migration should be higher than 0% as it will be the focus of analysis, they have to give themselves a conservative 30% chance for this to be proven instead of carry on 0% as per P#1 drill findings.
So average for the calculated source at 100% and migration at 30% = 65%
Overall CoS now in 65%+ range
The latest presentation has some good data on P#1 findings to date, but the forward work prog is to evaluate the data and update all the modelling - this will take time, it is years of work being recalibrated - it all adds confidence for next drill targeting, evidence they can present to potential Farm out Majors now the CoS has increased substantially towards 50% for next drill as outlined in my previous post - its why BPC had unsolicited interest on drill result, this interest may grow as the modelling is recompiled and findings shared with them - BPC know the oil is there, its just finding the best target now.
This is the ongoing work as per slide 29 future work programmes:
1 - Perseverance #1 data to be recalibrated with a well tie into 3D.
2 - Complete Biostratigraphy assessment, show geochemical analysis
3. A vertical Jurassic well positioned to evaluate untested Aptian reservoirs / closures at B South and or C structures, offering dual well targets
4. Immediate focus on revised 3D basin modelling with updated burial history, refining geothermal gradient from P1 data and including reservoir and source rocks inputs using the producing US Gulf of Mexico Jurassic Norphlet – Smackover play system
5. Integrate P1 data, refresh prospect inventory, renew licences and farm-out process based on new Jurassic play.
One aspect Potter mentioned pre drill was an impermeable mudstone drape across the structures - so the oil may have migrated from P#1 trap area but will be captured elsewhere.
This is mentioned in deep Geologicalese slide 29 as "clastics trapped in drapes"
"Syn rift clastics trapped in drapes and pinch-out against basement horsts and sealed by a thin Callovian/Bajocian salt or shale that forms the decollement"
Or in other words, the oil is present in a clastic formation (this being geology made up of fragments of pre existing rock, so good porosity for oil to reside as not solid, also it flows) and trapped by this impermeable drape, sealed by shale.
The Syn rift aspect is explained in this paper for any insomniacs, rifting, depositing of sediments, how they formed:
https://www.spgindia.org/10_biennial_form/P084.pdf
The key aspect of this post drill analysis work is item 4 - reservoir and source rocks inputs using the producing US Gulf of Mexico Jurassic Norphlet – Smackover play system.
Its using this known producing zones geology and characteristics -extrapolating/interpolating for Bahamian licence areas for the Jurassic play target. It was a notable pre drill supposition now proven that Bahamas was analogous to this huge system, at shallower water depths than 2200-3000m in GOM.
https://www.shell.com/about-us/major-projects/appomattox.html
A 500 m barrel reserve and producing 175,000k bopd.
This isnt the past BPC Major farm out discussions context now.
As per usual Tiburn another great post.
The Perseverance drill was actually a 1 in 4 chance - 24%
So what did they find? how close was it?
https://d1ssu070pg2v9i.cloudfront.net/pex/bahamas/2021/03/25213812/bpc-update-presentation-march-21.pdf
Slide 28
table bottom left hand corner
Pre drill risk assessment for Perseverance 1:
Trap - 100%
Seal - 80%
Reservoir - 60%
Source and Migration - 50%
Which when multiplied together gives a 24% chance of commercial success.
The drill post drill assessment is green or successful in 4 of the 5 key criteria necessary:
Trap - 100%
Seal - 100%
Reservoir - 100%
Source 100% and Migration 0% o - r red = a 50% average
So all parameters were successful for a working petroleum system, but the oil has migrated from this trap to another.
So re running this calc again, with a new focused drill for where they think the oil may now be:
Trap - 100%
Seal - 100%
Reservoir - 100%
Source 100% and Migration - 0% or red = a 50% average
CoS has now doubled to 50% for next drill
Which is summarised in RNS as :
"The Perseverance #1 well result has confirmed the presence of a working hydrocarbon system, validating the Company's structural play concept. In addition to obtaining an invaluable new sub-surface dataset which, in BPC's view, reduces the exploration play risk for any future exploration activities in this frontier province, the well verified the structural model the presence of competent seals, high porosity reservoir and hydrocarbon charge. The combination of these play elements points to significant hydrocarbon potential remaining in a number of independent, untested play systems and structures seismically identified from 2D and 3D within BPC's extensive acreage extending over its four (4) southern exploration licences covering approximately 12,000km2 (4,700 square miles - 3 million acres)."
And the focus area is the Jurassic:
"Additionally, data derived from Perseverance #1 provides a modern-day well tie to recalibrate existing 3D mapping of the Aptian intervals untested in closures and structures elsewhere in the licence areas. The primary focus of the ongoing post-well evaluation work is on the deeper Jurassic pre-salt clastic, structural play and the extent to which potential multiple-target drilling locations can be optimised to access and evaluate untested shallower closures whilst testing this primary, deeper play."