focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
Hi Nige,
I sure did, hope you had a good one too!
Well I think we are building a name in Angola while helping to bring production back to Kwanza. This field produced 29mmbbls over a period of around 30 years, developed in the 60's and 70's and shut in from the 1990's throughout that time oil was around 1/2 the price it is now. So it will be a big thing to reestablish production from this large field.
We may do, lots of news can hit at any time, looks like we should hear about the bid round next week, also if I'm not mistaken the preemptive offer for Mambare has to be made by mid Jan too.
"Following Corcel shareholder approval, the Company will formally notify BMA of a bonafide offer for its interest, starting a 45-day period in which BMA can legally pre-empt the transaction."
Also Canegrass assays from the November sampling could land any time. So yeah given the potential of news on many fronts £20m looks very reasonable, hopefully after the test results very cheap (fingers crossed).
Regards,
Ed.
Nige,
We might get the odd bonus along the way:
"ANPG will evaluate the bids received, a process which is anticipated to be finalized by 31 December 2023. The results of the onshore tender are expected to be announced by mid-January 2024, following which negotiation with companies will commence. ANPG expects negotiations to be complete by March 2024."
So results from next week onward, fingers crossed for KON-15.
Regards,
Ed.
Affc and Sienna,
You're welcome. Well these boards are a place for shareholders to share their views on their shareholdings, so the more discussion the better.
Aafc, yeah I agree, that is a very positive statement from CRCL. REservoir quality is clearly high for this limestone reservoir with the high natural fractures and porosity mentioned, all bodes well for flow potential, as does the recharging of reservoir pressure and presence of mobile oil. they've basically ticked all the boxes you would want to see ticked pre-test. Also the similar geology between all wells, recent and historic, and their connectivity bodes well for ultimate recoverable too; leading to the comments on significant hydrocarbons remaining in Tobias.
Regards,
Ed.
Nige,
You're welcome. I agree, we're in good hands with Sonangol running the show. They've been conservative and cautious so far for sure. Took around 60 days to do around 948m and around 45 days on the well at just over 700m, so slow and steady wins the race on this occasion. I too hope we're building up to a significant RNS re-Tobias, we're heading for a few, might even get Canegrass assays popped out too.
Regards,
Ed.
Hi Nige,
I've spent the afternoon rereading the previous announcements on TO-13 and TO-14. They have multiple possible pay zones within multiple intervals in both wells. So they may either perforate the whole lot or they may isolate some of these zones and carry out individual flow tests. I'd imagine there must be some over-pressure going on down there for a shallow well such as TO-4 to give what are pretty much world class flow rates from an 8m interval. That's like 480bopd per foot of reservoir, that's better than most wells in Kurdistan and they tend to be sandstone. So my guess would be they'll take their time and isolate zones, they'll not want to over produce from any section. But at least if they do get high flow rates it won't come as a surprise given what TO-4 did previously!
So my guess is it could be towards the end of the month for results, but then again they may part release results, they may release on a well by well basis so no counting chickens. With each test zone they'll likely do at least one or two 24-48hr pressure build up tests to see how the reservoir responds to production and and then pressure builds up over a short period shut-in. This could be done on multiple zones etc. They have plenty to test from both wells and then hopefully that will determine the scale of the separators and sales tanks they need for this EPS, before fingers crossed, moving to FFD.
Regards,
Ed.
Steve,
It sure is looking promising when you read this latest statements:
"Overall, the drilling results for the TO-14 well were positive, with oil shows found throughout the Binga reservoir in alignment with the distribution seen in historic production wells in the Tobias field, confirming both moveable fluids and the ability to reactivate production in the field.
Therefore, the consortium is proceeding to testing of the TO-14 and then the TO-13 wells, with the objective of flowing the wells and then moving on to the next phase focused on designing the early production system."
Once they know the flow rates from the "high fractured Oolitic Limestones in the reservoir with good porosity values", we should then be hearing about the next phase as mentioned above.
Regards,
Ed.
Simonskint,
Its all down to trade size. There is an NMS on every share or normal market size and within that the mm's have to deal at or within the displayed spread. Late reporting isn't to do with the settlement time, your trade should always be reported regardless of that. If your trade is however x10 the NMS they can typically delay reporting that for 1-3 hours, sometimes even 1-2 days later. Also they can put trades through the AQSE too so that they don't show on all trading platforms, that's not down to the customer choice but more to do with the market maker that did your trade. Settlement times are more to do with you and your broker rather than the mm's.
Regards,
Ed.
Hi Nige,
Can't say for sure. But I would imagine that you are along the right lines. Probably each company will put in a sealed bid for a certain amount of money/well commitments and possibly seismic over a certain period. The most suitable bidders will be selected. I would imagine that a number of companies will win an interest in KON-15, I've my fingers crossed that CRCL are one of those. Not long to find out.
Regards,
Ed.
Good afternoon Nige,
Thanks very much, happy new year to you too and to the rest of the guys and gals posting. Yeah its interesting that Mr Karam chose to convert some of his loan notes at a premium today. Clearly sees good upside to this level. Yeah its good to see this one so lively as folks continue to buy after the stunning results from TO-14 last week. Yeah lots of news looming over this next couple of weeks, as well as testing TO-13 and TO-14, news on KON-15 bid due middle of the month and should hear more about Mambare sale this month too. Really looking forward to the flow rates of TO-14 in particular!
Regards,
Ed.
Good morning JD,
Yes its positive that Mr Karam has converted a few at a premium to the current share price, he clearly sees good upside from 0.8p conversion price otherwise he could have just held and received the cash plus interest on the notes. Should be lots of news this month.
Regards,
Ed.
Good morning RL,
No not worked in oil and gas, but been an investor in oil and gas for over 30 years and mining stocks for about 25. My background is research based. So I do a lot of reading on what I invest in.
Regards,
Ed.
DC,
That is a possibility that there's lots of oil downdip of even TO-13, and yes it may still be migrating into the very large structure. Its clear that the previous wells have left substantial mobile oil. Oil and gas migrates in phases under normal pressure (we're not talking HT-HP wells and gasification of oil etc). So normal phase would be gas displaces oil and oil displaces water and then you have the oil water contact somewhere down the anticline (if there is one). TO-4 suggests there is one. However we also get mention of at least two compartments, so did only one of these contain oil and water, the other just oil?
So what you can get in a lot of oil fields is a gas cap, followed by an oil column followed by an oil water contact. So if oil is still migrating up the structure under pressure as suggested by the news releases, then yes you would expect to see the oil displace any water. In theory yes the oil and pressure may have built up again to a point where its back to initial oil saturation and pressure for Tobias. But lets wait and see on that. If at the right temp and depth the source rock could still be generating oil too. We'll know more from the testing and any subsequent wells if necessary, things could get real interesting real fast. These are the first two modern wells to be tested on this field, completion, perforation and logging will have moved on considerable since the Petrofina days.
Regards,
Ed.
Confounded,
Good point, not something the company has mentioned. It depends on the condition of the previous wells, they may not be in the best condition after 30 year shut in. But a possibility until we hear otherwise, couldn't rule that out 100% at this point.
Regards,
Ed.
Hi Nige,
I missed your last question, yeah I would say that the decision on horizontal drilling will come after the flow tests. To get the max drainage area that's the best way to go. Also productivity would be multiples of a vertical well and could delay the need for pressure support wells.
Definitely, KON-15 looks sweet, hopefully as we're now NOP to Sonangol and helping them to get production back to Kwanza basin we'll be in the running. I hope we do get a shared interest there. I'd imagine Sonangol will get operatorship as it looks like sweet block.
Definitely, 2024 is shaping up to be a key year, hopefully for both Angola and Australia and getting in most of that cash from the sale of the legacy assets.
Regards,
Ed.
Leew,
Exactly. Would make a refreshing change if the company did what they said:
"The Company will provide a further update before year end regarding its strategy relating to the development of its Cole Creek and Barron Flats Shannon Units."
"The Company plans to provide forward production guidance for 2024 prior to the end of 2023."
Where are these? The top statement isn't ambiguous at all, time ticking on that one.
Lets not get onto the subject of the July ops update which clearly sets out what needed to be done to get production back to previous peaks. Company needs to come clean as investors are making decisions based on partial information.
Regards,
Ed.
Good morning Nige,
That is unlikely, while some companies do open hole flow testing, probably not in this case. They can do side wall cores while the Binga is open hole. Plus they will have a full suite of modern wireline or electric logs plus also the drill cuttings/mud logs. They may also do micro-imaging of the reservoir, looking for those natural fractures. There's all sorts they can do, we may get hints of that in the testing update. They can tell if there is live or mobile oil down there from the mud returns, they may even take a small sample. Clearly they have enough data to date to state connectivity between TO-13 and TO-14 some 1.4kms away. Could be from oil biomarkers or pressure readings in combination with the known lithology from current and previous wells. Given the detailed release yesterday there's lots of info in there to compare all these wells.
Open hole flow testing would be riskier than cased well testing. So imo after all of the logs collected they'll run production liner and once that has set, perforate and test. We know there are multiple potentially productive zones, so they may isolate and test these separately rather than perforate most of the 80m or 120m in one go. Given the world class flow rate of TO-4 (its more like an offshore North Sea sandstone well), they'll likely test zone at a time. They'll not want to over produce. I've never seen an onshore flow rate like that from any well, especially not a limestone/carbonate. Companies talk about well productivity i.e how many bopd per ft they can get. TO-4 is offshore performance.
So we may get an early update or they may hit us when all has been tested. Given that RNS release yesterday I'm really looking forward to see those results.
Regards,
Ed.
BB,
GBP aren't similar to the other companies you mention at all, those other companies all have discoveries. I would also agree with Dicko, they haven't the best blocks in Namibia. TRP, especially with the upcoming Cameroon appraisal target looks much stronger, also have much better blocks in Namibia.
As for the other three, CRCL stands out head and shoulders above those. Tobias results have been outstanding to date and we're about to get two very exciting well tests in the near term. Those other two companies aren't any where near as well funded as CRCL either. Even if we get a fraction of the flow rates of TO-4 we should be off to the races. Sonangol seem to be quite ambitious as they drilled the more risky downdip well first and then drill TO-14 to offset a previous producer. I'm hoping they release the flow test results one at a time for maximum impact. Lets see.
Regards,
Ed.
Layla,
There's been lots of info released on Tobias to date. Yeah I agree its been a strange market for a while now, like you say it leads to some real bargains for folks to take advantage of in the right stocks. Hopefully some will really come together and shine in 2024. It sure would be nice to see the end of the bear market in the natural resources stocks. Lots of the underlying commodities are soaring, gold seems to be hitting new highs on a daily basis at the moment.
Regards,
Ed.