RE: shareholder value18 Feb 2022 08:21
goza, we have quite a few similarities, both oil industry, both running out of years, similar amount invested in echo though my paper loss is not as big due to averaging down heavily in March 2020 and again in Sept 2020 when echo was well below todays sp.
I agree with much of what you say, however the deal with Phoenix means we must repay 60% of CL costs so we need a million spare dollars minimum to get this tested and into production, on top of that we need another million (or so) as working capital for the rest of the operation, this is money we did not have so i can understand why CL has not been tested.
I also agreed with MHs strategy of concentrating on low cost well interventions which will increase production for minimal outlay, that said i struggle to understand why we are not jumping on three of the wells mentioned in the recent tier 1 doc, two of the Chorrilos wells (CMo-8 and CMo-24) are expected to give an uplift of 75 to 100 bbls/d each, the projected workover costs for each of these wells is $100k to $150k.
Then we have CBr-4 gas well in the Campo Bremen field expected to give an uplift of 2 - 2.5 MMscf/d with capex between $50k - $100k, why these three wells have not been worked on i do not know, we must certainly have the cash in hand for this sort of outlay that would increase overall production by around 40%, even mid case uplift we would recoup expenditure in a month at todays oil prices.
I also tend to agree our solar project is a complete waste of time while we have wells like the three mentioned above waiting to be done.
Yes we need to give MH and echo time, however i can understand investors frustration as i to feel we could be moving faster than we are however its the long game and the end result that counts and i am in the fortunate position that i can wait.
GLA investors.
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