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Shamelessly copied and pasted from Lemonsfool and also posted on another board, a long post by DSPP is certainly is food for thought........
My take,
1. Implicit in this is that the well PIs have both continued to fall. That can be a function both of what is driving the fluids to the well, and the nature of the fluids being lifted (i.e. they get heavier the more water there is).
2. The #6 well, flowing on its own, under natural flow has continued to increase in water cut. To my mind this indicates a high OWC that is being sucked in from below, and that water flow path is becoming preferred and the 'cone' (though it will not be a perfect cone given the fracture network) is becoming more firmly established. On this trajectory the #6 well would eventually cut so much water that it too would start slugging, just as the #7z well did. Slugging can cause equipment damage, and poorer functioning, and ultimately a well simply ceases to flow.
3. They have clearly not tried to flow the #7z well naturally again, because of the slugging. This indicates that the watercut in the #7z well had become too great, and the PI too little, for the #7z well to flow naturally in a sufficiently steady manner to be produceable.
4. There is no allusion to temperature profiles, chemistry signatures, or wet seaweed fronds as being suggestive of perched water. No actual evidence has ever been put forwards by the company in support of this, only asides. Given the complete absence of that evidence, and given the way in which all the actual evidence presented is consistent with water entry from below, then it seems to me that the local OWC in the area of the structure immediately below these two wells is relatively high up in the structure. All the evidence in the public domain suggests this is 'coned' water, not perched water. As such it will not get produced out and will in fact only ever increase unless water shut-offs create temporary reprieves (which I very much doubt will be worth it on a CBA basis).
5. They did not find a natural flow rate at which the cone in the 6 well did not worsen, this means that the water is too close to, and too mobile, for a critical rate to be established. That means that there is no pathway to a stable watercut that does not increase.
Continued.....
6. They can - and are - able to run both the #6 and #7z wells simultaneously on ESPs for the time being. This increases the oil production from the 12,000 bopd (#6 alone, natural) to 15,000 bopd (#6 + #7z, lifted). So only 3,000 extra bOpd. They have not given a watercut associated with that combo, which means they have only recently (3-July) started it, and what ordinarily happens is that as the cone below #7z relaxes an area of localised increased oil ingresses that then gets sucked out on ESP startup giving a temporary dry oil blip, then the cone fully re-establishes and worsens. My best guess is that they will not find a stable watercut on lifted flow, and that it will simply continue to worsen and it will be a matter of deciding what is the acceptable rate of increase vs the short term production.
7. They are sufficiently confident from a flow assurance perspective to hedge for an average 10k bopd for 6m. That gives us some insight into what timeline the company expects before the ESPs would (if ever) experience too much slugging and/or gas breakout and/or exceeds the AM FPSO waterhandling, i.e. at least 6m. It may be that they can see flow assurance beyond that, but felt that they could take a longer term view on a better floor price at a later date, but that they needed cash assurance in the shorter term, i.e. the board is now being a lot less gung ho.
8. Material downgrade. No **** sherlock.
9. IMHO implicit is the OGA will post-determination give them sufficient sanction for the Lincoln Crestal tie-back, which may by then be at a compatible pressure, flow rate, and PI to match the AM EPS facilities.
10. (This was not in the RNS, but is something I have been pondering). There is a material difference in LinWar API (lighter, gassier) deeper and to the south, then north and higher to Lan (slightly heavier, less gassy). Then look further north to Halifax and one has to wonder if it will be sufficiently shallow as to be even heavier API. That in turn means that the API might be materially more viscous and so flow less well in the fracture system (if the fracture system is viable up there).
There is plenty of room for this to be downgraded to a fizzle. There is some potential for a pathway to developments that might eke out a return. There is a faint hope of more than that, but not at this point enough to make me interested in a punt. The board are being a lot more candid and less skewed in their presentation of the data. There is at least one very heavyweight fixer on the board who Ker have brought in to get the best possible outcome - but we do not know the identity of the bondholders and so we do not know whether Ker's interests are fully aligned with private equity-only interests. At 10-15kbpod, worsening, those bonds are not going to get repaid or rolled painlessly.
regards, dspp
The implications of DSPP's post/theory doesn't bear thinking about as by implication it possibly means that price sensitive information could be being withheld or glossed over under some guise or other.
As as holder I am now further worried but felt it right to
"let their at it" on the this bb.
I
After him trying to sell scattergraphs with 5 variables I lost complete interest in DSPP crayon man. Someone who was supposedly heavily invested and then talked down his share until he had to sell at a loss is not someone i would look for any advice from.
3. They have clearly not tried to flow the #7z well naturally again, because of the slugging. This indicates that the watercut in the #7z well had become too great, and the PI too little, for the #7z well to flow naturally in a sufficiently steady manner to be produceable.
why would they want to run well 7 again naturally? well 6 is clearly the better well in terms of production and water cut. you would never choose to run well 7 over 6. since they cant be run together at higher rates the obvious thing to do was run well 6 naturally and then try both with the ESPs..
.cant be bothered with the rest of his post
Fair enough CaptainSwag. I can't say that I know much about his posting history hence the thread title.
Seems you've identified an ulterior motive though.
MK111,
'As as holder I am now further worried but felt it right to
"let their at it" on the this bb.
How very considerate of you.:O)
This has for a long time been a major issue for me. Dr T never engaged in serious discussion about perched v aquifer water. It was a case of you had to believe it because he said so. For a while, I did believe him. But as the water cut got worse and worse I eventually started to lose faith in him. Now he's gone and soon the truth will come out. Dr T wasn't telling us the whole ugly truth. At least that's what I think. The share is priced now for bankruptcy. It may yet come to pass. By the time the next CPR is due we'll already know. I think Dr T's stubborn inability to accept what was happening at his train set has cost many LTHs a lot of money.
Lol .....I meant " let the air at it"
Believe me the more that his post is shot down in flames the more comfortable I will be. No point looking at investments through rose tinted lenses and some good counter argument would surely be useful to all.
To some extent the nature of the water cut is immaterial since Hur announced in a previous RN S that there was a suspicion of a second perched water pocket causing inteference. Going forward it will be far more problematic trying to avoid perched water pockets with future drills than just drilling shallower holes to avoid aq uifer water contact.
Please could someone help me understand why Dspp says it is
“Implicit in this is that the well PIs have both continued to fall”
And
“The #6 well, flowing on its own, under natural flow has continued to increase in water cut”
The first I don’t understand at all. The second, I thought well 6 had been producing at c. 8% for a long time and as the RNS states was still the case before the ESPs were switched on.
Sorry if either is a really dumb query but they are each key to the rest of his well written and concerning note.
Just a thank you really.
Some very good posts on this and similar threads which has been refreshing to see on this bb.
It has been good to see. So many other BBs are so full of infighting that it feels like we are at election time.
have just read the 'coning & conning' thread and, frankly, dspp's assumptions have so much unsubstantiated assumption - some based on poor (wrong) physics, that i can't be bothered to correct his assertions here. Note to dspp: Assumtion is the mother of all f-ups.
gla
Assumption, even! lol. Apologies for typo.
gla
jasond;
1. Please could someone help me understand why Dspp says it is
“Implicit in this is that the well PIs have both continued to fall”
He doesn't seem to understand fluid-dynamic drag, that's why he doesn't understand why the PI would fall in an exponential manner. (Exponent < 1).
2. “The #6 well, flowing on its own, under natural flow has continued to increase in water cut”.
7z and 6 have 'virtually instant' pressure communication meaning there will be flow between them. This flow rate will be a function of pressure difference in the fluids at the relevant points, with viscosity an additional significant factor, the latter effectively meaning water flows more easily.
Given the state of siesmic knowledge of the Rona RIdge, dspp's assertion/hypothesis that the oil at the Halifax end would be too viscous to lift is baseless carp. The drill results there are more indicative (shame about the bullheading).
Now don't get me wrong - dspp MAY be right - but the evidence does not support his hypotheses.
gla
DSPP has no idea of what oil is like at halifax. he might as well say it was molten chocolate
trice believed it was in line with lancaster
JAdam, I don't believe that dspp is a charlatan, he just has a different interpretation. I used to occasionally attend the odd reservoir management meeting three jobs ago, and even with some of the best people in the industry sitting around the table you get divergent views even on conventional reservoirs early in a project. Over time once more information came in. their opinions would slowly come together towards better understanding and a solution. It is detailed reservoir information that is in the public domain that we lack so you will get divergent opinions and differing theories as to what is going on. Trice wasn't a fool and neither were the guys who independently wrote the CPR and checked HUR's data (including the Oil down to and water depth).
Blimey.... JAdam is it dummy Thursday;
- The faceless alias's on blogs
- - The faceless alias's on blogs most CERTAINLY DO LIE
- - - The faceless alias's on blogs most CERTAINLY DO LIE, thus I trust the business first
- - - - showing he was wrong, a cowardly but just crack on with the spam anyway poster imo
Let me just suck some air in ....all those bad, nasty, people out there.... who would have thought it ?
Anyone would think you were JK Rowling ....
bartlebobton
Is JK Rowling really a bad person?
DiveC .... absolutely not ... I met her once, at the soft play area in Leith, when I lived in Edinburgh. She's a lovely women, warm friendly and self deprecating. ... She just had one of her kids there, he was a delight...messing around with my youngest.