Member Info for GreyPanther

Egdon presumably still owe us £1 million as there's been no RNS to say it's been repaid. So that's another chunk to add to the £6.6 million in the bank. I 'm hoping / expecting that Egdon will have the necessary funds to pay us this when the loan is due for repayment since they (Egdon) will have received $3 million at the same time as UJO have earned $4 million.

Today’s report of S4 million earned since the proppant squeeze wasn’t exactly unexpected, given the higher oil price and improving daily flow rate. But there’s some very good news in the other details. The first post-proppant squeeze RNS was released on 24 August ’21. It therefore seems, depending on the actual earning dates, to have taken about 216 days for UJO to earn S4 million, which is 54 days per S1 million. And it’s better than that more recently as the third million $ seem to have taken only 42 days to accumulate, and this fourth million $ took only 34 days. So I reckon nearly $1 million is currently being earned by UJO each month. It’s also a big thumbs up that UJO has paid off the £2.083 million Calmar debt and still have £6.6 million in the bank. And I particularly liked the following: “The Company is covered for all operational and CAPEX costs, including any envisaged drilling, for the foreseeable future”. I’d like to think that sentence should help to allay any remaining fund raising concerns. IMO the management ae unlikely to do a deal like EOG have recently announced for the Serenity prospect when they have so many other onshore projects to progress.

UJO's ($3 million of Wressle income) RNS came out on Tuesday 22nd Feb. IMO it's unlikely that an AIM listed company would put out a positive RNS on a Friday. However, I reckon it will be pretty soon because both the oil price and the Wressle flow rates are up significantly since the last RNS.

Cloves. Regarding the "environmental activist" label: I'm certainly not one of those., but maybe your dislike of some of what I post is because I know a little about the onshore oil industry and I'm willing to share it. In my opinion it makes real sense to analyse our assets very cautiously, especially Wressle where not much info has been published recently). Why not filter me if you don't like what I have to say? Or maybe you could come up with some analysis of your own for us to evaluate. All the best, GP.

Hi Selfish. I'll happily agree with you that Wressle's "gross profit" could be about $100 per barrel for March but IMO this info doesn't help us very much. The gross (or operating) profit doesn't take into account all the sunk development costs which are still on-going. However, in terms of turnover and then operating profit, let's say that thee average Brent price for March will be around $110 per barrel. We have to allow for a small refinery discount of perhaps $2 per barrel to the selling price. So the daily turnover could be 255 barrels (Wressle) plus 65 barrels from EOG's other assets (say 320 barrels) x $108, or $34,560 /day. We then have to take off $16 per barrel to obtain the Wressle operating profit, according to Egdon. It's probably rather more than that for Crosby Warren as that field produces tanker loads of water which is very expensive to dispose of. Anyway, Wressle's daily operating profit could come to about 255 bbl x $92, about $23,460 plus 65 bbl x maybe $70, or $4,550, which comes to $28,010 in my book, so we aren't poles apart. A comment from another board said that 4 x 200 barrel oil tankers are leaving Wressle most days. If it's true, and these are quite small tankers, this would corroborate my earlier guesstimate of 800 to 850 bopd.

Wressle is unlikely to produce more than 800 to 850 bopd while the gas issue remains unresolved. This is because a 10 metric tonne daily limit on the amount of gas that can be produced and flared has been put in place by the Environment Agency. With a gas / oil ratio of about 550 cu. ft / barrel (this based on previous Egdon RNSs) and the likely density of the gas (which is presumably mostly methane), the upper limit is about 850 bopd. Our share would therefore be 30% x 850 bopd at best, or about 255 bopd net from Wressle alone. At least the $114 Brent oil price is on our side, if only temporarily, while the gas issue hopefully gets resolved.

You saw it here first! Here's what I posted yesterday. GP
"Amongst them are Jackdaw, perhaps Resolution / Endeavour, and maybe even Cambo. The last mentioned is the discovery that Shell pulled out of some months ago, leaving its much smaller operator (Siccar Point) in the lurch. So watch this space."

UK North Sea operators have apparently come under Government pressure recently to accelerate their undeveloped gas projects. There are several in the Shell portfolio that might be winners here. Amongst them are Jackdaw, perhaps Resolution / Endeavour, and maybe even Cambo. The last mentioned is the discovery that Shell pulled out of some months ago, leaving its much smaller operator (Siccar Point) in the lurch. So watch this space!

Hi milnrowmug. From the technical info published by Egdon and Union jack, IMO the North Kelsey prospect doesn't look nearly as attractive as Wressle did at the pre-drill phase, even though it's got somewhat similar geology. NK is owned 50/50 by Egdon and UJO, and they've apparently been unable to farm it out for years, notwithstanding the positive Wressle outcome. I too think Egdon probably lacked the funds to drill it up to now but, with all their other interesting projects, and with £1 million owed to UJO, they may still not have the readies. With any luck their interim results to 31 Jan '22 will tell us quite a bit more about their financial position when they are published, since they will include about five months of Wressle income post the successful proppant squeeze.

Egdon announced very quickly yesterday that they will appeal against Lincs Council's unfavourable North Kelsey planning decision. Even so, I can't convince myself that they (Egdon) are really serious about drilling at NK. They've held the NK / PEDL 241 licence since 2008 without drilling a well, and had already been given two planning extensions by the Council. IMO it's not a surprise that Lincs Council came to this decision. Even if Egdon win their appeal in due course, it's pretty obvious that drilling isn't going to happen anytime soon, certainly not in 2022. And that's assuming they can afford their 50% share of the well cost. With so many other interesting projects on their plate at the moment, wouldn't it be better for Egdon and UJO to let North Kelsey wither on the vine and concentrate on their better prospects? They aren't short of those for sure.

From a geological POV, I can't see fracking happening at West Newton either, not in the Kirkham Abbey, nor in the deeper Bowland Shale. WN-1 is the only WN well to have been released so far and you can can find all the geological info, including the formations tops on the UKOGL website if you're interested. That’s the UK Onshore Geophysical Library, not UKOG plc! The Bowland Shale at WN-1 is only 66m / 216 ft thick in total. Quite a lot of it is limestone, so it’s not much of a candidate for shale gas and / or fracking, IMO. The Kirkham Abbey is possibly a different matter. If Rathlin can manage to drill the next (?horizontal) well without ruining the permeability, the RPS study shows that fracking won't be necessary. If the KA reservoir turns out to be only moderately permeable, I suppose it might benefit from a small scale proppant squeeze job (which is sometimes called a mini-frack) as Egdon have shown so successfully at Wressle.

On Wressle reserves, the current ERCE CPR shows 2P reserves for the Ashover Grit (0.54 million) and Wingfield Flags (0.08 million) or 0.62 million barrels for the two reservoirs combined. There's a comment on the ADVFN today site that we have already produced more than 100,000 barrels form the Ashover reservoir.

Hi VernetLes andSerif. Thank you for that. Here's Heidi's Monday post on UJO's LSE site for anyone who may have missed it at the time:
"Dear Heidi,
We are currently awaiting final information from third party specialists in relation to the detail of the potential gas grid connection at Wressle. This will enable us to make the final decision on the most economic method for monetising the gas. For gas export, small scale packaged process equipment is all that would be required to get the gas to grid specification and meter it. These are not large and complex pieces of equipment and are routinely used in for example bio-gas sites.
Best Regards, Mark Abbott"
I'm still not clear about what MA means by "potential gas grid connection". IMO he could be thinking of either gas processed and delivered to the grid via a short new pipeline or, perhaps more likely, gas burnt and converted to electricity and the sold via the national grid. It seems pretty clear that we are still some way from receiving cash for the approx. 10 tonnes / 0.4 million cu ft of gas that's probably being burnt every day. Any further thoughts?

Hi Serif. Thanks; I missed that comment from Mark Abbott in spite of ploughing through the last few days of postings on UJO's LSE board. It wasn't a lot a lot of fun, or of interest either, sadly. Could you please give the date and time of that post, assuming it was on UJO's LSE site. Thanks, GP.

Hi Serif. I've no really sensible suggestion to offer about what Egdon might be waiting for. Maybe the necessary equipment isn't available off the shelf, or are they still doing technical studies? Surely not, but perhaps it's possible that oil (and gas) production at the current high rates took them rather by surprise? Maybe the 10 tonne per day flaring limit was previously thought to be more than adequate before they got so much more than 500 bopd out of the Ashover Grit.

Hi VerbierDave. My "usually reliable" source thinks that the Wressle gas to power scheme (or whatever Egdon are planning to do to deal with the excess gas) hasn't been decided on yet, let alone installed. So IMO all that site activity might have something to do with the installation of the extra / bigger flare, which may have come from Cuadrilla's Preston Road frack site. Still, he could be wrong!

Hi VernetLes. IMO Wressle is unlikely to producing much more than about 800 bopd / 4 tankers per day because of the EA's current 10 tonne per day limit on gas flaring, particularly as a GOR of 550 cu ft. per barrel has been published by Egdon. Please have a look at my 16.02 post on Tuesday. All the best, GP

There’s been some speculation in recent few months about the factor(s) that might be limiting Wressle production. These ideas have ranged from choke sizes, to excess gas and flare capacity, to the maximum number of tanker loads allowed per unit of time, etc. It’s also been noted elsewhere that an additional flare with sufficient capacity to handle all the gas has apparently been installed at Wressle lately. This is most likely the ex- Cuadrilla Preston Road flare which is thought to be very big. I then wondered what the Environment Agency has to say about flaring at Wressle. I was rather intrigued to find this EA Variation Notice: Egdon Permit EPR/AB3609XX/V003 which says “The amount of gas flared shall be less than 10 tonnes per day”. This allows some interesting sums to be done regarding Wressle’s oil and gas rates.
We can probably make a reasonable guess at the gas density since it must mainly consist of methane which has a density of 0.0415 lb per cubic ft. The next most common component is likely to be ethane with a density of 0.0777 lb per cubic ft. So let’s say the gas density is about 0.05 lb / cubic ft. Since 10 metric tonnes is 22,046 lbs the flaring limit is 22,046 / 0.05, or 440,920 cubic ft per day. We know from two Egdon press releases made in Sept and Dec ’21 that Wressle’s Gas / Oil Ratio is about 550 cubic ft per barrel. This places a limit on oil production, at least until Egdon are able to reduce the amount of gas they burn. So my 440,920 cubic ft divided by 550 cubic ft per barrel comes to 802 barrels per day. This seems remarkably close to the four x 200 barrel tanker loads per day that have been mentioned. So we can probably rule out 1,000 bopd for the time being, or at least until Egdon reduce the flared gas by some process or another. Generating electricity from it seems, IMO, to be more readily achievable than putting the gas into a pipeline. The latter would involve on-site gas processing and then laying a pipeline

I've also posted this on Egdon's LSE board:
There’s been some speculation in recent few months about the factor(s) that might be limiting Wressle production. These ideas have ranged from choke sizes, to excess gas and flare capacity, to the maximum number of tanker loads allowed per unit of time, etc. It’s also been noted elsewhere that an additional flare with sufficient capacity to handle all the gas has apparently been installed at Wressle lately. This is most likely the ex- Cuadrilla Preston Road flare which is thought to be very big. I then wondered what the Environment Agency has to say about flaring at Wressle. I was rather intrigued to find this EA Variation Notice: Egdon Permit EPR/AB3609XX/V003 which says “The amount of gas flared shall be less than 10 tonnes per day”. This allows some interesting sums to be done regarding Wressle’s oil and gas rates.
We can probably make a reasonable guess at the gas density since it must mainly consist of methane which has a density of 0.0415 lb per cubic ft. The next most common component is likely to be ethane with a density of 0.0777 lb per cubic ft. So let’s say the gas density is about 0.05 lb / cubic ft. Since 10 metric tonnes is 22,046 lbs the flaring limit is 22,046 / 0.05, or 440,920 cubic ft per day. We know from two Egdon press releases made in Sept and Dec ’21 that Wressle’s Gas / Oil Ratio is about 550 cubic ft per barrel. This places a limit on oil production, at least until Egdon are able to reduce the amount of gas they burn. So my 440,920 cubic ft divided by 550 cubic ft per barrel comes to 802 barrels per day. This seems remarkably close to the four x 200 barrel tanker loads per day that have been mentioned. So we can probably rule out 1,000 bopd for the time being, or at least until Egdon reduce the flared gas by some process or another. Generating electricity from it seems, IMO, to be more readily achievable than putting the gas into a pipeline. The latter would involve on-site gas processing and then laying a pipeline connection.

Ivans. Your 22.13 post yesterday was slightly misleading, if I may say so. You said "looks like EOG is rising ahead of EDR and UJO after they farm in into serenity licence, which is producing becoming partner with I3E". Sadly, Serenity isn't a producing field. It's only a discovery awaiting an appraisal well. So, even if it's a successful well, any Serenity income for Europa and i3e will still be some years away.