Member Info for Foresight22

..only effects 6 well if 7Z is not flowing perched water. Need to be cautious until 7Z perched water cut starts to decrease. Once HE gets their ducks in a row on that concern (BHo was flowing initial water from sands above FB!). Lancaster is flowing oil from predominantly Fracture System therefore the wells should be instantly effected - very high perms involved in large fractures. With large PIs, DD must be minimal.

..think HE now past that using seismic & static geological modelling - all down on Lancaster certainly to Material Balance and matching oil rates, produced volumes to pressures => reserves. Think by 6 months production should have good insight that Lancaster wells actually draining Halifax too. Massive field mean very little depletion, and the aquifer like BHo will be very small - predominantly Host Rock 1-3% porosity, or less. HUR SP can only increase once this current M&M phase is removed by clarity & clear HE thinking.

Clearly from CMD video with WD flowing mobile water (presume perched water again), all HE future wells need to target Zone A (Zone III equivalent, Figure 12) [Crestal Wells] leaving the deeper resources now to be targeted by new operator after OI (Zone B & C being only 'incoming' Resource upside - need 'deep pockets' to pursue). That probably means HE now just targeting C1 Resources - effectively 775 - 1000 million BO recoverable - as per CMD Figure 69 - some 120,000 BOPD net HUR (some 600 million BO => $3-5 billion MC). I'll take that net value in 2021 before OI! CMD video did say >300 million barrels 'seen' Post Start-up production, infinitely acting - no barriers.

Can see why non-oilers confused - Dr R-T should clarify more with post CMD RNS when all post well study work completed.

How HE thought WD well objectives had 78% COS drilling Zone C - is a question worth answering by some invitee to January CMD! ...luckily LC & WC will be tested and banked by then.

Good paper on FB. Fig 15 - Fracture Distribution with depth insightful. Oil FB not discovered until 1987 (Well BH-6) and production from this reservoir began in September 1988. Earlier production (1986) from sands above (?).

http://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=2ahUKEwibi42wxL7jAhVkRxUIHeUfCwcQFjAAegQIABAC&url=http%3A%2F%2Fwww.saltworkconsultants.com%2Fassets%2Fbach_ho_cuong_warren_09.pdf&usg=AOvVaw3xKNiQtErANX9BFunKtc9J

A2UK,

Surprised you have not looked at Lincoln map, LC appraising reservoir not drilled by 205/26b-12. Will see what leaks out 15-20 days time, SP been very leaky since May! - with hindsight. FB spread out over thousands of acres - geology changes laterally as well as vertically, as WD showed. Drilling WC as crestal as possible makes lot of sense when not drilling a pilot hole... HE learning a lot, questions by big investors are getting better too.

SP "bad day in office" again! ...until Dr R-T can answer the investors questions -- guess we need to wait for real tangible new well results. AM production lifting very soon - POSITIVE.

Lincoln Crestal (LC) - new well drilling data will start to leak soon - probably 15-20 days away - POSITIVE. Only concern is HE did not learn from WD - still not planning near vertical pilot hole to ensure 'seismic' faults open, before optimal placing of horizontal; not drilling LC more crestally. ... HE will just have to learn to drill longer horizontals, and more crestally, to ensure more than enough productivity while SP so sensitive. If LC has more learning - Warwick Crestal (WC) can still benefit. When WC flows better than Lancaster - value less current SP will soon change - VERY POSITIVE. Otherwise have to wait for 7Z water cut to start to decrease as perched water depleted - VERY POSITIVE.

Kerogen must be very short of funds with Cuadrilla and now ENOG buying Edison at a song. ENOG like Cuadrilla has no production so HUR investment very timely now for them. Better Kerogen sell some of HUR than they run into 'uncertainty'. Kerogen suffered 10% discount so they must be looking at BoD too! Dr R-T can always issue additional RNS answering the CMD questions - clearly not interested in current SP - so far.

LTH now looks like 15 - 70 - 150 days, then will see SP reflect acceptable values (>58p). Be interesting to see if Kerogen will be gone completely in 120 days! ..or maybe HE will start to value HUR SP and market accordingly. Kerogen selling could be the only real stick 'in town'.

Smart bit of business - well done UOG! ...need to churn to spurn.

The dismissal of the water cut in 7Z plus his body language suggests he was (as a geologist) not that comfortable with the technical issue (being dynamic, engineering theory). Perched water in hydrocarbon reservoirs is a poorly researched topic (very good presentation was given couple of months back at LPS by Shell) whereby due to hydrocarbon filling of initially water filled rock, some pores (fractures in FB) end up with mobile water still in 'dead-end' pores. The HE picture clearly is wrong as it is not 'dead ended' where depicted water bearing. These dead-end pores therefore contain mobile water - not irreducible water (as quoted in the CPR - which Dr R-T stated incorrectly to another question!) which is predominantly capillary bound above the transition zone (other question in Q&A! - also poorly answered), BUT, at oil columns pressures (refer pressure plot with oil pressure line and water pressure line crossing at theoretical OWC). Hence in 7Z both oil and (perched) water are mobile therefore the water cut is constant with typical drawdown ranges production tested (which Dr R-T said initially - but - later said water-cut would go down if flow at lower rate(!) - not consistent with perched water!). The 100% proof will be if it is perched water (mobile water from dead-end pores will not be that large a volume in regions above closure - even decreasing volume further towards the crest) then water cut in the near future will be still 8% but slowly decreasing as the dead-end water is depleted/produced... Early water production is expected in all reservoirs with perched water contacted along the producer - but this is not irreducible water (1 - 10% in CPR! (which was wrong answer by HE)).

As HE ramp up 6 & 7Z, water cut will be watched - but has not bearing on meeting the 20,000 BOPD rates (IF perched water - which is most likely as the water pressure seems to be consistent with oil pressure - ie stable rates achieved very quickly in May). With WD perched water rate was 600 BWPD at 1000psi DD - in Lancaster 7Z with minimal DD at 15,000 BPD (say) => 1200 BWPD plus 13800 BOPD. 6 can flow 15,000 BOPD therefore 7Z needs 5,000 BOPD with around 400 BWPD (ie negligible). With WD, clearly volume of perched water is much higher - but in poor permeability fractures -- below structural closure. ie drill at crest! 6 well higher up on structure than 7Z...

Agree 100% CMD was good day but next week SP will see how other investors mark HE presentational skills...

A2UK,

Watch the video on CMD, during the Q&A Dr R-T clearly says the WD seismic faults not seen in WD horizontal. The 9th presentation has not been released - have requested from PESGB. If he says different technical interpretations on different days that's not good practice. I can comment further when 9th is in public domain. CMD should have been presenting simple message - "AM doing better than planned - Lancaster reservoir more productive with more of the well flowing than on DST - Profiles have been increased accordingly - 37 MMBO risk-less reserves. Additional CMD in January 2020".

Why did Dr R-T present WD results (which were still work-in-progress) anyhow at the CMD when an RNS had been published already dropping SP to 42p --- WD is half owned by Spirit too. What's there interpretation of WD? CMD should have been about HE GLA production test analysis - certainly confused the invitees when WD presented too, creating more M&M...

HUR 'marmite' is not helped by not answering questions asked by attendees which were invited (to ask questions - if some were non-technical). Saying they are covered in CPR when they were not; saying there is no transition zone when the pressures demonstrate OWC in Host Rock and FWL in the Fracture System; ..is not helping. Not sure Dr R-T could answer the questions posed! He could not answer why the seismic fractures identified before drilling WD were not seen in WD horizontal(?).

Let's see what next week bring with SP - Lancaster production data shows that the risk is very much reduced on delivery of 37 MMBO reserves -- so SP if not effected by M&M should be >58p. If you think the CMD went well why is the SP not >58p?

Yes, AK your non-oiler need working on.. not sure very you should be drinking whiskey while as sea, keep hauling - suns great down here - calm all week. SP back to 58p next week..

RNS still not addressing non-Oiler’s, WD was oil discovery, fractures present in well drilled but HE conclusion was fractures poorly connected in this area - despite being found to be as predicted - hence non commercial rates achieved. NO actual rates at WD released - so still work in progress. 900 BO Prospective Resources in Warwick still good..

Certainly good question to ask! Apparently all the effective porosity measured on the HE well logs run gives this relatively high effective porosity as demonstrated on the log derived curves so as long as the petrophysicist has done his job ok! Difference between Total and Effective Porosity is the pore filling ‘clays’. Apparently the weathered formation gives rise to higher ‘porosity’ than seen in other fracture dominated reservoirs. WD was drilled below closure where the saturation height function calculates higher water saturation than crestal well ‘see’ - hence Dr R-Ts pre well concerns. In fracture dominated systems not a lot of clear understanding of what this SWH function precisely/actually is because resistivity curves very poor in fractured systems due to mud losses while drilling. So water present in oil column which when tested will flow small amounts because pressure drawdown leads to water expansion => minimal water flow. No water produced from coning with such high columns of oil. HE has also surmised that not all fractures will be oil filled in the oil column(!) - must be very small!... BUT for Lancaster this all does not matter as the producers will ‘tell’ them the effective oil volume connected to these wells - hence the importance of the pre-FOIL production test results. Hence importance of CMD presentation today. Hence the real hope of reduced M&M - which based on 9th so far has not help SP.

For those still on Effective Porosity, your then need to worry about effective height and then effective Area => Effective STOIIP connected to well WHICH should now be pretty well understood from pre-FOIL testing as well as last two months production pressures etal. Life moves no - so suspect good question will not be asked or answered... time will tell.

Lots of reasons why WD may not have produced - could also have been man made ____ up, eg poor execution like on Halifax.. we may not know; does HE really know.. who cares when WC produces commercial rates.. not sure CMD will help Warwick today, only another 70+ days to find out whether key..

Very poor M&M not issuing RNS today at first light... 9th presentation has not been released either yet.

HE post CMD need to be savvy going forward on FFD. Needs to think about (1) turning Contingent Resources post WC success in 3 months into Reserves, Proven Undeveloped — maximising HUR value, at least HUR CAPEX; (2) tie-back LC to AM next year drilling two new Lancaster producers and one new LC producer in 2020; (3) should get Spirit to install new FPSO (40,000 BOPD) over WC (2021) drilling 2 more WC producers and 1 more LC producer in 2020; (4) get Spirit to install major FPSO (120,000 BOPD) over AM location in 2022, with HE drilling three producers over Halifax (2021) - moving AM over to Halifax (2022). Once producers drilled HUR should be able to class Resources as Proven Undeveloped. Something like this HUR could fund - increasing chance of OI. This level of activity (200,000 BOPD @2022) should keep RNSs up along with SP... lots to think about. Many possibilities.

HE post CMD need to be savvy going forward on FFD. Needs to think about (1) turning Contingent Resources post WC success in 3 months into Reserves, Proven Undeveloped — maximising HUR value, at least HUR CAPEX; (2) tie-back LC to AM next year drilling two new Lancaster producers and one new LC producer in 2020; (3) should get Spirit to install new FPSO (40,000 BOPD) over WC (2021) drilling 2 more WC producers and 1 more LC producer in 2020; (4) get Spirit to install major FPSO (120,000 BOPD) over AM location in 2022, with HE drilling three producers over Halifax (2021) - moving AM over to Halifax (2022). Once producers drilled HUR should be able to class Resources as Proven Undeveloped. Something like this HUR could fund - increasing chance of OI. This level of activity (200,000 BOPD @2022) should keep RNSs up along with SP... lots to think about. Many possibilities.

Big week let’s see how BoD address the ‘Marmite’, can they start to talk to non-Oiler’s? Use words everyone can comprehend..

Certainly less ‘Mushrooms’ after 9th & 11th!

Keep hauling buoys! Sun great down here - sea flat as a mill- pond.

Ps when SP got a chance to get to 240p - I’d agree. 100 other shares worth trading - why was SP at 185p anyhow? ..you should buy Tullow before Guyana 4 billion BO new discoveries drilled. Less than 40 days now. When i’ve earnt 80%, maybe...

“Good News”
1) negligible pressure depletion => greater than 100 MMBO Reserves
2) schedule for future liftings from AM
3) schedule for 100 MMBO Reserves profile, with timings for OGA approvals

"Lancaster pumping oil but for how long?? "

CMD will tell you! Only need to wait till 11th July. Maybe even 9th, would be very silly to present Lancaster geological model without future production prediction. Because Dr R-T is doing a media blitts next week, it is very likely that Lancaster production is at risk at all. Not long now... But don't expect the SP to go about 58p. Need WC success to do that...

ps just because wells may not flow when drilled & tested by HE, it does not mean oil will not flow and be recovered from below structural closure by crestal wells. 'Man-drilled' wells create 'skin damage' which when nature does it -- not present! Think of it like people watching Roger & Tiger - all that litter left behind each day. All houses need cleaning - flaky people live there.

WD, in Dr R-T words, discovered oil column.