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Nigel,
If there is pressure correlation between mou 1 and mou 3 then that would be important evidence to indicate there were no faults between mou 1 and mou3 which could compartmentalise the field and hence require more production wells to drain the field .
That’s hugely important offshore when a well might cost $30 to $40 million, but onshore predator claim they can drill for $2.5 million, so not a big deal.
What’s unknown is the gas water contact , and there is a good argument to indicate that the reservoirs are full to the spill point, given the seismic gas cloud to east of mou 2. In the absence of further data, I assumed reservoirs are only 70% full of gas , which may be conservative. In addition I assumed a 66% gas recovery which is very conservative and could reach 85% to 90% with further flow test data, so being conservative here also.
Jimmy
The mou3 logging rns stated.
The Moulouya Fan sand was encountered from 1378 to 1437 metres TVD MD with approximately 50.5 metres of sand versus a pre-drill P50 forecast of 19 metres.
Elevated background gas readings were recorded whilst drilling this section.
The interval correlates with the Moulouya Fan interval penetrated by MOU-1 drilled 7 kms. to the SW and its presence supports the development of the Moulouya Fan over an area of at least 30km².
My estimate of the potential recoverable gas is based on the average mou fan thickness of 30 meters as proven by mou 1 and mou3 wells.
My estimate of the recoverable gas volumes, if confirmed by flow testing is as follows.
30 meters of average reservoir thickness x 30km 2 area= 900 million km3 / 35.3 = 31,770,000,000 acre ft x 19% porosity x 66% recovery x 70% gas charge x 307 gas expansion factor = 856.1 bcf.
So between the two wells that would proove up 1.2 tcf of gas of which predator have 75%
Incredible value here for wells that have been drilled, logged and waiting on flow testing.
Jimmy
The mou 3 rns stated.
Within the interval from 815 to 895 metres TVD MD five potential sands with gas shows were encountered. Individual sands have a maximum thickness of 3 metres giving an estimated cumulative thickness of 11.5 metres versus a P10 pre-drill forecast sand thickness of 10 metres.
The Ma Sand had a 3% formation gas show.
Pre-drill P50 structural closure was determined to be 6km² for the area tested by MOU-3.
MOU-3 well results have confirmed that the Ma to TGB-6 interval can be correlated with the same gas-bearing interval in MOU-1, approximately 7 kms. to the southwest. The two well data points now support a seismically defined sequence covering an area of up to 58 km² that potentially forms a combined structural and stratigraphic trap for gas.
My estimate of the potential recoverable gas is as follows.
11 meters x 58 km2 = 63800,000 km3 /.353= 22,521,400 acre ft x porosity 19%xrecovery 66%x gas charge70% x gas expansion factor 182 = 359.8 bcf gross recoverable.
Jimmy
So just clarify the situation regarding the bonus, it’s only payable after a concession licence is issued and average daily production over 6 months is 50,000 barrels per day or approx 300,000 mcf per day, which is three times Morocco daily requirements at the moment, so this bonus will not be paid for a few years . Daily revenue is approx $3 million per day at such volumes, so it’s not an issue, nice problem to have.
Jimmy
Hi Donal,
My understanding that the gas storage system would require a capex of €500 million to re establish kinsale for gas storage.
What makes this noteworthy is that two major Irish companies are involved.
Hence my view that mag mell is probably not favoured by the civil servants.
As the uk interconnect or can only import gas, any gas stored can only be used on the island of Ireland as new pump facilities to re export to uk, that severely limits the market for stored gas. The cost of upgrading the inter connector to export surplus gas is about €200 million, so a limited opportunity. Best for predator to focus on Morocco.
Jimmy
Https://www.irishtimes.com/business/2023/10/30/moneypoint-could-burn-coal-past-2025-deadline/
More coal burning approved by green environmental minister
Predator announced that testing would begin of mou 3 on or before 16th oct.
Predator stated 43 meters of the mou fan reservoir had been identified by nuetech for flow testing. At an average flow rate for such geology in the adjoining rharb basin of 1.1 mmcf per meter per day results in a flow rate of 47 mmcf per day.
The current price of cng in Morocco is approx $12 mcf of gas. Predator have started negotiations to sell such gas at the well head instead of to end users location by cng. Predator previously advised the cng capex costs for 50 mmcf per day would be approx $100 million, but by selling at the well head predator save the financing and equity dilution of funding such capex in exchange for a lower gas price. I am guessing such a price is $8 mcf , in which case predator would earn $270,000 per day net of royalties, assuming it can sell 47 mmcf per day.
The capex saving then frees up £3.9 million which can be used to drill and test the crabornate reef appraisal well and the shallow mou 3 reservoir by mou3 A well.
A lot to look forward to from these forthcoming test results.
Jimmy
Hi surfit,
Predator budgeted $2.5 million to drill its wells and chariot have budgeted $3 million to drill and test per well for four wells, with the balance of it fundraise for corporate pre anchois development costs and working capital.
They are funded till they can get past costs of anchois reimbursed.
Jimmy
Keith,
I think that was a very old estimate pre mou 2.
Now having drilled mou 1 ,3 and 4 we have circa 150 meters of gas sands to test.
Very good chance of meeting the moroccon cng market of 50 mmcf per day with plenty of capacity for export.
Jimmy
B4now
I agree with you that aim market punishes shares when equity dilution is expected, hence the urgency to get to operating cashflow asap.
With regard to Namibia, yes chariot did not find oil, but total and shell have found billions of bbls in the last few years in Namibia. Close but no cigar.
Jimmy
Nigel,
The important thing about the shell deal to provide lng, is that we now know the benchmark price which is the lng price in Spain, as quoted daily plus a conversion premium and a transportation premium for transport by pipeline from Spain to morroco , an estimate of about $1 mcf .
So a market price for 2024 in Morocco at about $15 mcf.
Yes, please.
Jimmy