RE: Warrants30 Apr 2021 17:34
Florida, your initial question is one that cannot be answered unless you are fully conversant with the fiscal regime applied to production of oil and you have the lifting costs at you fingertips. Different fields in the same country have different lifting costs and frankly I have no idea what they may be at the onshore and offshore wells. I said that sarge had pretty much answered it and really, there is nothing to debate. Maybe if you want to find out, spend some time reading through the multitude Candax news items and try to find something that refers to their annual report or maybe there is something in one of the publications about the typical lift cost at Ezz, then apply the fiscal regime based upon whether this is a concession, a psc or some other hybrid deal with etap and work it out. I didn't see anything negative in my response and I took the trouble to reply out of common courtesy. Negative?-if you want that then Tunisia has tiny oil reserves when compared to other countries, they have been declining quicker than anyone has been able to discover new reservoirs and there has been little investment in the country for good reason. Candax re-entered half a dozen wells in an attempt to increase production but in general it was a mediocre and disappointing but with some success on a couple of the wells in particular. Seems to me they have been in Tunisia for about 15 years and have gone down the road as far as they are prepared to and have subsequently obtained a new 25 year agreement to sweeten the deal and offload their liabilities. Offshore even though in very shallow water is a pain as everything has to be shipped or sent by old boaty bloke or by chopper, the risks are far greater environmentally and the rewards/cos etc on the face of it don't look promising. There is evidently some belief that there is untapped unconventional oil that could present an opportunity but realistically Zenith are not in the position where they can start looking at long horizontal wells and hyd fracturing on a more or less wildcat basis. 1000bbls a day to Zenith from Ezzouia and Elbibane, not likely unless they drill a new well. Candax have been there, done it, managed to get production to 1000bbls but I assume that was shared and are now bailing out. Until Zenith have the resources, a rig in country, a drill team and the corporate to function as an exploration company I will remain cautious but Tuesday is the start of another week and lets see how it goes. Oh, as a positive warrants at 1p I agree is a bold step, maybe they heard about the closing of the deal and expected a better response but nevertheless the extra cash will come in useful. Last post for a while, might look in periodically.
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