Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Keith, I’m going to send you a deerstalker hat to wear (may be a tad hot for Aussie climes, I realise) – your sleuthing has reached Holmesian proportions!🕵️♂️🔎
So it appears that PRD’s now involved in delaying strategic infrastructure projects in Morocco...
It's nice to have friends in high places 😎
Great stuff, Keith 👍
Bdt, that's great info, thanks for taking the time to contact the company directly and for sharing👍
And thanks Voskos too for the timely reminder of Bdt's previous posts.
Reading all that info reminded me of a couple of posts from GRH from last May about Sand jet which are worth a re-read, IMO. See 'For Your Consideration' parts 1 and 2, 12/5/23 19:54 and 20:03:
https://www.lse.co.uk/profiles/grh.../?page=16
Note in particular the proppant effect of Sand Jet and its positive effects on poroperm, another reason why, as per the conclusion in Appendix C in the ITR (p58), the wells "should flow gas if formation damage is overcome."
Https://www.malcysblog.com/2024/02/oil-price-kistos-arrow-predator/
"Smart, exciting and interesting is what I make of this deal which I certainly wasn’t expecting but which seems to be a well fitting and more key, a strategically important piece of business. Key and strategic because it fits in very nicely with UK Energy Security Policy, something that should remain the case whatever the colour of the Government and changes AA into a new strategic investor…
The two gas storage facilities have been bought for a fraction of what they originally cost and are a major part of the UK onshore gas storage jigsaw and perhaps more interestingly are ‘fast cycle’ which means that they are instantly available for short term demand. In this respect to begin with Kistos will be working with a ‘leading trading house’ although I would expect them to be doing that job themselves before long, worth the while if you can provide 11% of the UK’s flexible daily gas capacity if called upon.
Being free to buy or sell gas gives Kistos significant extra flexibility in the market it operates and this subsidiary not being considered an oil and gas company will own 100% of the trading business and liable only to taxation as a trader and not the Looney tax. It also has the opportunity to provide the UK with highly valuable ‘cushion gas’ the value of which alone more than justifies the purchase price.
Finally and for the longer term, the company notes that this could provide profitable opportunities in both compressed air and has potential for hydrogen trading should that market develop. It looks like Andrew Austin has yet again come up with a dollar for a dime.."
Just for a bit of fun, you can have a peruse of the facility on Google Street Map:
https://www.google.com/maps/place/Bloor+N+E/@53.1471219,-2.4532996,15z/data=!4m6!3m5!1s0x487a588705aec637:0xfb47660b55a9796c!8m2!3d53.1501583!4d-2.4453532!16s%2Fg%2F1vs1rdg9?entry=ttu
Drule,
From PG's LinkedIn page:
"CEO
Island Oil and Gas PlcIsland Oil and Gas Plc
Dec 2004 - May 2010 · 5 yrs 6 mosDec 2004 - May 2010 · 5 yrs 6 mos
Ireland
As operator drilled four successful gas wells in the Celtic Sea, which tested at a combined rate of over 53 mm cfgpd"
Hopefully that answers your question.
Davwal,
I agree that timelines have slipped in the past. But if Graham Lyon's correct in what he said just yesterday, the question is who's using the rig over the next month? As far as we know, it's neither SDX nor CHAR (and we know it's not SOU) and I'm not aware of any other operator in-country who might wish to use SVR101.
So that just leaves PRD. Therefore, has Graham Lyon inadvertently given us a clue as to what's going on behind the scenes at PRD? If drilling is being brought forward then this would fit in with what Cube tweeted about "the 'order' of things has now necessarily... changed" following testing of MOU-3, and also Keith suggesting that early MOU-2 re-entry was now on the cards.
Thanks Rupert,
It’s interesting to note exactly what Graham Lyon says: “And we are bringing in a rig, the Star Valley Rig 101, and that’s due in AFTER THE PERSON WHO’S GOT IT AT THE MOMENT FINISHES WORK, and we expect that to come towards the end of March.”
So I’m slightly confused by that. Who’s currently using the rig? We’re doing rigless testing, so it’s not us (and, as far as I can tell, it’s not SDX). Unless, of course, there’s now a firm plan for us to use the rig sometime over the next 4-6 weeks, perhaps for MOU-2 re-entry and/or MOU-5 earlier than the previously announced April-May window? And Matt, just my thoughts but I don’t think the current testing programme of the Ma and TGB-2 sands would necessarily mean not drilling MOU-2 (Moulouya fan) and MOU-5 (Jurassic) asap as the data analysis would be for different sands (but I may be wrong here).
In addition, we also know that CHAR is planning on using SV101 for 2 wells on Loukos with an expected start date “… around the end of Q1 2024.” So it seems that there’s demand for the rig from 3 companies all at around the same time, and it’s not clear to me who gets first dibs. Hopefully, all will be revealed soon...
Hi Jimmy,
From the Sept 2022 Proactive presentation (slide 5) the timeline from rigless testing to first CNG gas sales is estimated to be around 10-12 months (precise dates have slipped, of course). Presumably, as our CNG partner (Afriquia) is in effect part of the Moroccan government, then the EIA is likely to be issued promptly.
https://wp-predatoroilandgas-2020.s3.eu-west-2.amazonaws.com/media/2022/09/Proactive-Presentation-Final-8-September-2022-LATEST.pdf
Also, and this is more speculative, the satellite images of MOU-3 show that the area immediately adjacent to, and east of, the drill pad was modified from 20th Jan this year and then the larger section from 2nd Feb. We can’t know for sure that this is for the CNG facility but I’d think it unlikely that any farmer would be wanting to plough fields for crops immediately adjacent to a heavy industrial site (with the potential for Sandjet run-off) so presumably there’s a reasonable chance that this area is linked to PRD activity. Therefore, if this area is for the CNG facility, then might this suggest that the EIA for such has already been issued (or at least that PRD has been given the ‘nod’)?🤔
Tweet from Javier Blas:
https://twitter.com/JavierBlas/status/1757682717389373779
"In its annual LNG outlook report, Shell says that global natural gas demand will peak "after 2040" (that's significantly later than the @IEA's view of before the end of this decade). Gas demand has already peaked in Europe and Japan, but is growing elsewhere | #EnergyTransition"
Worth a look at slide 5 of the report, showing increasing global demand by 2040 and, particularly, increased supply via LNG (no wonder the Moroccan PM is so keen to get involved in LNG!):
https://www.shell.com/energy-and-innovation/natural-gas/liquefied-natural-gas-lng/lng-outlook-2023/_jcr_content/root/main/section_125126292/promo_copy_copy_copy/links/item0.stream/1707839026113/d9e9541083378a2e8b1c096efe7d37fdff59fb34/master-lng-outlook-2024-feb13-final.pdf
Basically, the world is going to need a lot more natural gas over the coming decades...
The other slight spanner in the works is the CHAR 2-well drilling programme, which you mention. Their 5th Feb RNS stated that ‘we are on track for commencement of operations around the end of Q1 2024.’
Assuming 10days or so per drill, plus time to transport the rig between Loukos and Guercif, that could mean, if CHAR takes the rig first, potentially pushing the start of our drilling campaign to the second half of April at the earliest.
However, due to Paul’s longer-term relationship with the rig contractor, I wonder if he will have a degree of leverage to allow PRD’s activities to be prioritised over CHAR’s?
Ideally, I’d like to see us drill MOU-5 first (and maybe also re-enter MOU-2). Then pass the rig to CHAR for a few weeks which would allow us time to analyse the new well data, bring in additional well inventory items as necessary, and possibly commence flow-testing of the new wells (if warranted). Then take back control of the rig to drill all the other wells you mention back-to-back. 🤔
Always great to hear your ‘speculation’, Keith, many thanks👍
That’s in addition to Cube tweeting yesterday that “My 'suspicion' is that MOU3 testing has already already 'blown the doors off’”🚀
...and GRH just chilling out and thinking of flatcoats and the spring🐕😎
The possibility of 9 wells by the middle of the year all with potentially significant flow rates reminds me of Paul’s comments from 24th November 2022 (made when only MOU-1 had been drilled):
“[A] Strategic objective to demonstrate a potential gas field production profile of between 150 to 250 mm cfgpd…”
What is the phrase that GRH often uses…??
“This is the biggest race to the finish any will ever see…”
Hi Jimmy,
I’ve always read with great interest and appreciation your measured views on the Jurassic prospect, thanks.
And just for clarity, although I mentioned Wacky’s 91Tcf figure in my earlier post, I’m honestly not getting too carried away (well, not that much anyway!).
As I remember you previously highlighting, the 2021 IMC presentation (slide 12) mentioned the possibility of “224 metres of oolitic limestone with potential reservoirs” in MOU-NE:
https://wp-predatoroilandgas-2020.s3.eu-west-2.amazonaws.com/media/2021/09/29105657/Webinar-Presentation-website-Version-28092021-Corrections-15.40pm.pdf
However, this has now been reduced to 18-20m. I’m not sure if this is the result of more detailed analysis and hence a re-interpretation that the 224m is no longer valid, or is just a function of the ITR purposefully being very conservative? However, of note, the ITR does suggest there’s some upside potential: “A more optimistic 50m pay interval is used to generate an upside High-case taking into account the prospect has more favourable expression in seismic data and is anticipated to contain a thicker porous carbonate section.” (p. 29)
The F-D note gives recoverable resources of 484Bcf for the 18-20m which, in itself, is not too shabby. And then there’s the potential for very decent upside… even if ultimately we don’t ever reach the giddy heights of 91Tcf!
Anyway, feet firmly on the ground, I promise 😉
(cont...)
Seabright:
LSE post 9th August last year:
“However can I respectfully suggest that we are merely….scratching the surface.”
https://www.lse.co.uk/profiles/seabright/
KeithOz:
Highlighting the commercial scale of the opportunity, 16th July last year:
“Over the last few decades, I have used NPV & IRR to evaluate literally hundreds of projects, I would put those with an IRR of around 100% in the exceptional category. The G2P/G2EU example I used to give an NPV12 of £2.5Bn has an IRR of 386%. I have never seen such a high number, nor such a short payback period.”
https://www.lse.co.uk/profiles/keithoz/?page=20
(And let’s not forget that the IRR for CNG is 138%; and for Cory Moruga 240.9%)
And now we also have the ITR highlighting the significant running room in the licence, as per Cube’s tweet:
https://twitter.com/__The_Cube__/status/1755350184828015093
There was an interesting discussion on here the other day about GRH’s TSR of £15, so just a brief follow-up on that.
Firstly, and as far as I’m aware, GRH has never put a time-frame on the TSR presumably because, due to the huge scale of the opportunity, it’s possible that shareholders could be receiving royalty payments from Guercif for years (perhaps decades?) to come.
And secondly, I seem to remember that GRH mentioned some time ago that he suspected that he’d never have to sell a single share in PRD in order to achieve his 1000-bagger. When we consider the many comments from the great contributors to this board highlighting the magnitude of the assets, supported by all the information given in the ITRs and recent RNSs, I think we can start to understand why.
And why my plan is to hold on to as many PRD shares as I possibly can, probably indefinitely!
(As ever, not counting any chickens etc…🐣🐔)
Morning all,
Folks are right to highlight the many superb posters on here who freely offer their insight, expertise and knowledge – we’re greatly indebted to them all.
In particular, I feel that their posts have really helped me to grasp the sheer scale of the opportunity at Guercif, which I’m pretty sure I wouldn’t have done otherwise. Here are a few (of many) examples:
GRH:
Has often made reference to the Ghawar field, for example:
https://twitter.com/GrahamHengland/status/1698671977785917949
“Until the World's great hydrocarbon fields were fully discovered, They lay undiscovered
That was the situation WRT Guercif (also the situation WRT the mighty Ghawar)
Folk are only now starting to understand what I have long been banging on about #PRD”
https://twitter.com/GrahamHengland/status/1733439941638574267
“When the true scale of Ghawar was finally discovered ... (Took 11 years I was told whilst in Riyadh) Somebody will probably have uttered these or similar words: 'Good grief... It's all BIG It's all CONNECTED'”
https://en.wikipedia.org/wiki/Ghawar_Field
Wacky:
A reminder of his 91Tcf tweet!
https://twitter.com/TheWackmeister/status/1711820551461773537
and follow-up post on here on 11th Oct last year:
https://www.lse.co.uk/profiles/thewackmiester/
As Wacky says:
“...if anyone thinks Paul and the Team are going after puddles instead of 800m Jurassic formations...They need to give themselves a Shake.”
Caterham7:
LSE post 13th July last year:
“...I have worked in O&G Exploration for over 30 years. I think the Jurassic test has potential to be one of the most globally significant discoveries of the last decade. Very pleased to see confirmation in RNS that the Jurassic will be tested.”
https://www.lse.co.uk/profiles/caterham7/?page=2
(cont...)
Thanks Keith, and apologies as I hadn’t double-checked the P2 testing schedule as set out in Table 2.
I’ve just had a quick look at the recent RNSs. On 12th Jan, mention is made of testing ‘Multiple thin shallow sands’ in MOU-4 and then on 26th Jan (in the table of gas resources) ‘shallow sands MOU-4… subject to rigless testing’. So the plan did seem to be to test the Top M1 sands, I wonder if it’s just been missed off Table 5 in the ITR?
Morning Jimmy and Evening Keith,
I’ll admit that I’m somewhat slightly reluctant to contribute here as I’m only too aware of the fact that I’m probably more likely to confuse the issue than provide any clarification! But, FWIW, my reading of things is slightly different:
Table 5 (ITR p49) states that P2 testing will include ‘Multiple thin shallow sands (Miocene)’ in MOU-4. I’d assumed that these are the ~50m of sands mentioned in the 13/7/23 RNS (‘MOU-4 update with results of NuTech petrophysical analysis’) and so will be tested with Sandjet. Fig 5 (ITR p17) shows these sands were also penetrated in MOU-3 and are designated ‘Top M1 Sand Seabou equivalent in the Rharb’ (as you say, Keith).
Where I slightly differ with your post, Keith, is that I think the ‘A Sands’ are designated separately in Fig 5 as ‘Latest Messinian-Early Pliocene (equivalent seen in Rharb)’. These are the very shallow, high-pressure sands not logged in MOU-3 (due to having to urgently case that section) and can only be tested once MOU-3NW is drilled i.e. they will not be tested in the current testing programme (P1 or P2). From Fig 5 and also Fig 15 (ITR p32) the ‘A sands’ would not be expected to be present at the MOU-4 location. It’s these sands that are mentioned at the bottom of Table 2 (ITR p42).
Therefore my thoughts on your original post, Jimmy, is that the M1 sands from 519 to 713m will indeed be tested in P2 but are somewhat confusingly designated ‘Multiple thin shallow sands (Miocene)’ in the table summarising the upcoming testing programme, rather than simply calling them the Top M1 sands. (Of note, Table 3, ITR p44, only gives a relatively low ‘combined COS “flow to surface”’ of 21% for these M1 sands, but Paul must presumably still be confident enough to want to test them.)
Hope this makes some sense and, as I say, apologies if all I’ve done here is to muddy the waters.
Q: “Does any potential suitor show their hand when results known?”
The RNS of 12th January was strongly hinting (3 times) at a potential partial asset sale upon successful Phase 1 flow testing:
“...the ability for potential early monetisation of gas following a successful Phase 1 rigless testing programme.”
“… the opportunity for partial monetisation of gas assets in Guercif, always subject to a successful rigless testing programme.”
“… an accelerated process triggered by potential early partial monetisation of gas assets, which are subject to a successful rigless testing programme.”
All of which suggests to me that discussions have been ongoing and that a deal may already be done in principle to sell a stake in PGVL immediately after the release of results confirming commercial flow rates from Phase 1 testing. (+/- a call option for the rest of the subsidiary?)
Only another week or two to find out...⏳
GRH tweet:
https://twitter.com/GrahamHengland/status/1752341979122246025
David
I had considered breaking my golden rule
By forecasting SP
Decided not to do so ... YET😇
But
This has multi £BN MC written all over it
➡️➡️➡️👓 ⬅️⬅️⬅️
Hi affc21
I was just reading up about the Oxfordian age and it turns out that, as a Scarborian, I actually live on (and look out onto) Oxfordian rocks… you learn something new every day!
https://en.wikipedia.org/wiki/Oxfordian_(stage)
“The Oxfordian Stage was called "Clunch Clay and Shale" by William Smith (1815–1816); in 1818 W. Buckland described them under the unwieldy title "Oxford, Forest or Fen Clay". The term Oxfordian was introduced by Alcide d'Orbigny in 1844. The name is derived from the English city of Oxford, where the beds are well developed, but they crop out almost continuously from Dorset to the coast of Yorkshire, generally forming low, broad valleys. They are well exposed at Weymouth, Oxford, Bedford, Peterborough, and in the cliffs at Scarborough, Red Cliff and Gristhorpe Bay. Rocks of this age are found also in Uig and Skye.”
https://twitter.com/WGCG_UK/status/1436387905178673160
[apologies, last comment was cut off]
“Your market cap is always not going to reflect what the potential value of the company is… [but] it only takes one well or one agreement to change that value and it will be changed overnight…”[Sunday Roast podcast Apr 23]