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I'm not surprised people are getting twitchy I'm really nervous of the outcome, so I have to keep reminding myself and looking at the SWP presentation.

The company policy of keeping this drill tight and not releasing information of any sorts is discerning . Shareholders should have been informed on why the plans had changed and why the extra money was required in my opinion

The map of Bonasse is a good place to start to remind yourself what we have. The oil presence is shown in red and water in blue. The P10,50&90 contours are shown with Saffron placed near the centre.
What is P90. We have an estimated 19m reserve in place, that means there's only a 10% chance of not finding that oil.
Looking at that map instills confidence in me for a better than expected result.

I've never heard of a well being widened, that fact alone makes me believe there's a lot of oil down there.
The section through the Lower Cruse is still the 8" for a 7" casing and will house a 6" pump, which should cope with the sand influx.
I'm not sure if they will produce from all the 3 zones at once or not

I'm still confident but nervous
ATB:))

Hi everyone
Sorry I've broke the silence
Just read this long article by John Kingham of ukvalueinvestors

It's mainly about why investing in house builders and Help to Buy scheme
Very level comments

ATB:))

Hi Peter
I didn't explain myself very well.

$32,500 guesstimate would be costs associated with lifting the oil.

The costs for drilling etc is capex from cash in hand or Lind money and the payback for this out of revenue, once the payback has been completed the revenue goes into Cerp coffers :))

Hi Peter
That's a hard question
10 bopd from the top 2 levels at $50 revenue =$500pd x 365 =$182,500 pa
Take out costs guesstimate 32,500 would leave $150,000 pa income

My hopes are for 50bopd from both layers that would be $1,825,000 revenue without the Lower Cruse
Payback in nearly 12 months

Let's keep are fingers crossed
ATB:))

Just had a reply from my lad whose an accountant
He says the IRR is the discounted rate to bring the NPV back to zero
The figure can only be achieved mathematically over a long period so can be forgotten about
$88m still looking good over ten years :))

Morning Peter
The increase of the well diameter suggests that this is no longer a pilot well but a production well :))
To have 2 sections 17.5" and 12.5" before casing suggests to me there 2+ zones ready for production without the Lower Cruse.
The increase in dia doesn't necessarily mean there maybe more reserves in the lower level
The definite increase in reserves will come from the top 2 levels

If the reserves are a lot bigger then this will need more than one drill to get it out and a future CPR report will take this into account , therefore reducing the amount of reserves that can be moved from possible to probable to proven i.e. P3 to P2 to P1
This is where the follow on wells will be in my opinion, to increase the proven reserves. I think Clove might get forgotten the prize/asset is too small
ATB:))

SWP presentation
I'm no accountant so I've googled
IRR and NPV10

Unlevered internal rate of return which has a discount figure of 117%
Still none the wiser on this figure

NPV10 of $88m
My take on this $88m is the expected profit over 10 years which has been worked out using the discounted rate on outflows and inflows. It takes into account the value of cash now and the value of that cash in 10 years time.
This is all based on 11.5m recoverable barrels

This is why I keep saying the more reserves increase then all these accountants figures increase and more investors will look at Cerp

ATB:))

Hi LLL
That's not near Bonasse , it's to the NE and closer to South Erin.
The Chatham Road north and south goes both ways from the main Southern Highway towards the coast.
I've seen worse roads around Swindon lately where the verges are all collapsing with all the water around

There are big numbers involved but there are 2 figures to consider
The "money pit " $500m can be used to borrow money but you have to deduct liabilities and divide by the share issue before a Net Asset Value can be assigned.

E.g. NAV = £400m - no liabilities, divided by 800m = 50p

Would we ever get to £382m asset value.
10m recoverable reserves is less than the estimated Pmean or P50 but this is without any recoverable reserves from the Upper and Middle Cruse

P50 mean of 11.5m + 3.5m (guess) for the Upper layers would =15m
A low P30 figure of c6m could still get us to the 10m with the Upper layers
A high P70 figure (which is my hope but probably too high) would get it to c20m recoverable reserves

I get confused with big numbers:))

Hi Harel
On a $60 oil price Cerp get $50 revenue:))
I believe it's upto a 10m barrels produced mark

Oh and I do rely on the Presentations for the information so I can read between the lines :))

Hi LLL
I hope no one else is listening but for one of the first times I think I am agreeing with some of what you say.
The company is asset rich but cash poor.
Cerp is stretched but all these assets do give us a benefit in being able to choose where to spend the money we have , to get the biggest bang for your buck quote.
At the moment Bonasse is the star prize with $50 revenue per barrel.

What's happened to the finances:-
Snowcap hitting water was a bit of a blow, was hoping for it to produce 80 bopd at $30 =$2,400 pd
Spt tax has had a dramatic effect at Goudron, even if the water flood does produce loads will it be worth turning the taps on
The Saffron well of course has cost more than anticipated. The company said they could afford the pilot drill out of their coffers but as they said they needed a buffer, which is where the first Lind loan came in. The drilling activities were looking very promising and the decision to increase the drill diameter and install production casings was taken. There's most of the first draw down gone and they needed another buffer
The Board then decided to start taking salaries in cash
It's not cheap to do what they are doing with Saffron and I think we have to take it on the chin with the second Lind loan, I hope there won't be a third but maybe.

Before Saffron produces anything Suriname will need some sort of cash for capex

So those are the negatives as I see it and I feel it's going to get tougher over the next month or two.
We need rewards of some description, where are they coming from:-
I'm hoping for a min of 200bopd from the Lower Cruse and eventually another 100 from the higher levels =$15,000 per day at $50 revenue. This income should self feed the rest of Saffron in my opinion.
The CO2 project starts January and we start to get 50% of the revenue after PRD get their costs back maybe take a few months.
Once going Suriname should start to self fund and hopefully with PRD help with more CO2.
These 3 projects should lift the reserves/assets by a long way and help to provide cheaper bank loans.

Initially I can see a dip in finances and maybe more loans but the medium outlook looks very promising.

The biggest positive would be Competent Persons Report issued in the early Spring showing a big uplift in reserves which will give us a money pit in the ground to borrow against

Hi in4
Thanks for reminding me that it was FRM1
I scrubbed out my notes about it when I got lambasted for posting the costs, thinking I got it wrong.
Well it looks like I was more near the mark.
I have read or heard something about another well that went fairly low but not sure
I don't know where the 400m target will be but I suspect it will be deep and out of our reach (financially) at the moment.
A joint venture is the only option for that one and I believe that may happen in next year or 2.
With the licences we have the order of spend must be:-
Bonasse,Icacos,Goudron, South Erin

Not mentioned Innis cos of Predator or Cedros which is still an exploration play.

More infill drilling at Bonasse then over to Icacos for infills and well deepenings.
That's my thoughts on future plans not Cerps
ATB:))

Hi Peter
I missed your remark about the seismic.
They've only shown the information for the Saffron well in my opinion so no need to show what's below at the moment .
From the SWP presentation Leo explains how the Cruse layers have been forced upwards by thermal forces, whereas at Goudron these layers are way lower.
There's more"bang for your buck" at Saffron:))

Hi Peter
It's the agm one
The 1000 target was met just but the financials of achieving that goal were unrealistic with the spt restrictions
ATB:))

Hi Peter
Hope you had a good Xmas

The lower oil bearing rocks are not at a constant depth ranging from 3,000' to the east of Trinidad to possibly 14,000' under the SWP.
There hasn't been a drill yet that has encountered these zones under the SWP but one drill I believe did get stuck about 12,000' down
The costs for doing this would be prohibitive, I won't say the cost as l got knocked to pieces when I suggested the sum last year but if you want to hear Leo say it listen to the 2018 presentation that neon posted last week.
If you are asking where the 400m target is I would have to say I haven't a clue where or how deep it is but it's onshore :))
ATB:))

Hi LLL
I'm not really with you on the concept of onshore Trinidad being totally different from offshore.
As I've tried to explain the lower levels of oil of the Herarra etc are from the Jurassic period and these spread under the whole area of the basin.
The N American continent was moving anti clockwise away from S America causing thermal thrusts,wave formations,traps, faults
By the late Cretaceous period Africa was moving away from S America pivoting around Suriname causing great pressures, thermal thrusts, deposition, traps,canyons, faults. This had a great effect on the Columbus basin to the SE of Trinidad which would have felt the effects of both movements.
The SWP has some evidence of the thermal movements thrusting lower lying stratigraphy upwards and possibly forming the up dip fold at Saffron.
It's very complex and no one can say at this time that the offshore formations don't run under the SWP as there has been little exploration

Hi Harel
Looking at the map on that site that LGO posted of the Jurassic age there looks to me like an island in the Trinidad location . I doubt it's the same as most of Trinidad is alluvial deposits but there are elements of volcanic activity.
Most of the oil in Venezuela is as you say heavy but it's more like the Canadian tar sands but at deep levels around the Orinoco basin. Over the years the lighter oils have migrated towards Columbia and Trinidad leaving the heavy oils behind.
The oils of the Herarra under Trinidad I believe these were formed in the Jurassic age and formed part of the Venezuelan/Guayanan basin and stopped around the border with Suriname.
The oil fields off the coast of Guyana are not Jurassic oils but late Cretaceous and just encroach onto the shore regions.

WNZ has 24m of reserves at the moment assessed by the few drills that have taken place and 2d seismic
There's a lot of work to do to increase those reserves but is underexplored and with Tambaredjo having 80m remaining and Tambaredjo North West/Calcutta are producing around 16,000 per day the prospects for WNZ look very promising

Hi Harel
You haven't got your history right either, 350m years ago was Carboniferous period. Jurassic period 209-145m years ago was the period where the oil was first created under Trinidad and Suriname.
The late Cretaceous period contains 2 periods of time Cenomanian and Turonian and these source rocks feed Taredejo north and Calcutta fields.

The south of Suriname has the border of the pre Cambrian shield and there is definitely no oil there

Oil origins in the Venezuelan, Guyana & Suriname basins started forming in the Jurassic period 150m years ago. At this time Trinidad was closer to Florida than Suriname, and the Caribbean and North Atlantic were a lot smaller than today. Africa and South America were one continent and North America was moving away westwards.
This was the start of the oil fields stretching from Venezuela to Guyana. These fields were gradually covered over with alluvial deposits and are the fields at very deep levels in Trinidad.
About 120m years ago Southern Africa and Southern America started pulling apart , pivoting around Suriname and caused huge forces creating many faults, traps, canyons, thermal forces. The next generation of oil was being formed at this time and 90m years ago Africa had split forming a large channel off the coast of Suriname/ west coast of Africa. This channel was being filled continually with sedimentary deposits covering the source rock with deposits. A big rift had formed to the east of Guayana causing many faults/traps .
The early Jurassic oil had now migrated and been trapped under the Taradejo field in Suriname in the numerous faults, whereas the second generation oil formed in the new waters between Africa/S America. This oilfield was gradually split in 2 off the coasts of Suriname and the west coast of Africa with little on land.

WNZ field has had minor drilling and 2d surveys so little is known, but it is riddled with faults and traps. Any oil is not likely to be connected as it migrated from way down and got trapped
The field is going to need a lot more 2d and 3D surveys to find these traps.
There will probably be less opportunities to find secondary oil.
The forthcoming drilling and EWT will give more insight into the geology of Suriname and WNZ
The oil in WNZ has an API of 16 and is a sweet heavy oil with a low sulphur content
Exciting New Year ahead good luck everyone:))