Member Info for InJamesweTrust

Soder
If that is the intention then it is expectation management. I hope they use different consultants from Joe/Jethro as we still await the report on commerciality of those fields!!!!

I'd say they would know I'd it's sulphurous from tests on the rig and the viscosity will give some clue as to quality but the exact API etc would need testing.
Regardless of it being weather or technical I guess the point I'm trying to get across is there is now c.10 days beyond the initial window of say a 6th Oct spud and 25 day programme so it would be unfortunate to lose that much time. I'm sure tightness of drilling challenges would have been noted when Aj1 was done if so and rigs are alot better equipped now.
Get the capabilities of a 6th gen and the difference in harsh weather, hope it is core testing and doing tests on porosity and the like that is occupying them along with imaging of the traps

So with a spud on 9th, that is a few days lost. It is now 32 days so even a week lost to weather following spud would have them at 25 days now.....

Think it may be more weather related than tool related. Not sure of sea levels in the first days in terms of anchoring and beginning drill ops.
Imagine the sidetrack kit was waiting on condition it could be returned if not required
Hopefully in and testing now

Flaring also needs permission and with the environmental lobby being quite active it is something they would likely oppose unless absolutely necessary.

Still nervous in case there is a less happy reason for the timeline. However, it is getting such that they would have encountered some real challenges to explain this level of delay. Not outwith the bounds of possibility but hopefully its for good reasons such as testing core samples and side tracking.

No worries
On valuation - if drill string is bust or weather has been **** or rock is collapsing as they drill and when they do get there it is dusty sand and a bit of water then all the metrics and assumptions obviously mean bugger all!

Uk

There is an article in the FT about the proposed IPO/sale if shares of Ithaca Energy by Delek.
Ithaca is valued at $14 boe proven/probable
CAPRICORN IS $16
SERICA IS $12
Tullow $13
These are all producers with cashflow and dividend and a track record of moving to production so their valuations are higher and more multi faceted than barrels of oil. However, as a metric these levels show that the $3-5 range is probably sensible if the drill makes them contingent reserves. There may be $0.50 - $1.00 attributable to 3B/4B also if there is a read across from this drill.
That would give £2.12 to £3.55 for 246m barrels.
For Guyana drills where Joe was around 40m barrels net to Eco we got to about £260m market cap but that was based on the other 400m barrels it may prove up also. There are more barrels in the SA acreage due to higher Working Interest so it is reasonable to think the MCAP could go higher on equivalent basis as oil is higher also and expected to remain at elevated price levels.

Hi Wyndrum,

If thinking about value per barrel, the market value today is not the value of the field. There is a projection of prices 1 day to 30 years out which form a curve and based on average expectation. So based on this average that might be the value of a field gross.
The value of selling a barrel for $65 in 30 years is less than it is in 2years, so a discount is applied. Generally 10% but it may be dictated by minimum required rate of return.
In order to get the oil out, there are operating expenses and capital expense to establish the field. These come off the price expectation too. Hence, the $65 average for 25 years boils down to $2-8 per barrel perhaps depending on perceived risk and strength of the business.
Take a look at Ithaca Energy where I think defence documents show value of barrels at the current oil price for the time the offer was made.
Other factors are macro, economic situation, risk free rate (T-bills/Gilts) means higher equity return hurdles.

To get a $100 a barrel you need to be able to have a platform or FPSO to extract, a pipeline network from the drill pipes, Christmas trees and lots more , then it has to be xtracted over several years and investors need a return.
Hence the net price per barrel is not the value of the field.

Wyndrum
$75 a barrel simply won't happen. Somebody posted a while ago about how Joe and Jethro were valued by Mr Market and Gil has suggested $8 a barrel or that a find would make Eco a billion dollar company.
Ultimately, the market decides.
For 200m barrels net to Eco I'd think 150-200p depends if Eco can come out and state API and other info on commerciality of find

It's O&G so can still give you a result you weren't expecting and certainly didn't want. Hopefully the extended timeline following late(ish) spud date is for reasons that will make us all pleased when results are announced. However, it may be be the delays in spud have been repeated since. Or there is a lost drill string or the rock is harder to drill.
Hopefully not and we are now on Day 28 of drilling activity and it is taking the time because they're logging resources.

Market Cap is a bit of a fools errand. Gil has mentioned 8 bucks a barrel because of proximity to shore, depth and resultant simpler development profile.
With sidetrack they are targeting probably 400m in total. Can't see $8 myself but it will be interesting what a find means to the value of 3B/4B as well as 2B. There is a big prize there too.

It's going to be interesting Wallact. Apols for spelling on last, was rushing between lunchtime errands.
I haven't derisked but then I haven't added since spud as have held fire for now.
After the weekend we are at day 29/30 based on an Oct 9th spud but very much depends on how the hole/weather has gone what day of activity we are on.

Wallact - what I'm saying is applying for the licence for AJ-1 resources is easy enough notnrhat the.prior drill would be used for well system. If in event of a discovery that is what is needed to secure the patch for 30 years then call it an AJ-1 licence and extract oik from across the block in whatever hole flows it commecially

If they find oil, they can register under AJ-1 and even if it only pumps 200 barrels a day, the cost of one extra connection to a Xmas tree in 2 years for the benefit of a 30 year licence is of nothing. Should hopefully mean we hear by the 16th if they've found oil or not though

The cost of the side track is around $3m if I recall so for 100m barrels plus it would ve crazy not to regardless of the result of the stacked targets.

Not counting my chickens but a can of Heineken will do for me until a visit to the pub at a future date.

So today is Day 25, run-up in Canada last night but no RNS makes me wonder about leaks so guess we will see. Hopefully no issues with hole/weather and its just the large pay zones that are takiing the time required!
Seriously though, getting to the nitty gritty now and good or bad probably news within the week.

ExxonMobil are in the luxurious position of having an abundance of light sweet crude to develop and produce so Hammerhead has been down their priority lists. That may change as Urals crude may be harder to get hold of for Western heavy industry and the higher for longer price scenario maybe makes Joe/Jethro economics better.
ExxonMobil can blend it in FPSO with other oil from nearby fields, we didn't drill down so can't do that hence economics for JJ has a higher bar than Hammerhead I'd say.
How they must regret not going deeper (said the actress to the Bishop!!) When doing the Jethro drill.