Member Info for Jimmy23

Those analysis of future gas supply forget to include the fact that all gas fields have a decline rate which was not taken into account. The declines vary by field of course bit a 7 % decline rate would be unusual and for fracked gas wells it can be 25% in the early years.
There is a quick win for those campaigning to reduce green house gas emissions which is to ban the burning of coal in power stations and replace with natural gas, a 45% saving in emissions.
Jimmy

Hi porters,
The fact that a major gas pipeline runs through predators acreage is definitely a major attraction for big gas. Certainly predator have seemed to be guiding investors towards the high end of gas volumes , which really can only be confirmed by drilling.
However, the downside of smaller production flow rates is that it allows predator to get to cashflow very quickly and have the finance to carry out a major appraisal drilling programme funded from production cashflow.
Jimmy

Delete reference to sound energy, incorrect.

Hi foot and mouth,
We know we have 21 meters of net pay in mou 1 , while a nearby well flowed at 1.9 mmcf per day from a one meter interval, I would suggest there is a very strong chance of getting at at 10 mmcf per day from mou1 and at least the same from mou 2.
SDX energy have drilled 10 wells in this rharb basin , which is a continuation of predators basin, and they have had success in 9 wells.
Sound energy reported previously an 85% success rate from their drilling in the same onshore basin.
Jimmy

Correction $11.11 mcf

Average gas price achieved by SDX energy in Morocco in the first six months of 2022, was $11.85
Jimmy

Interestingly, SDX produced 5.1 mmcf per day in the first six months of 2022, generated $7.5 million.
That’s at an average price of $11.85 mcf.
So relatively low gas volumes can be transformative for predator
Jimmy

SDX energy announced the discovery of two additional gas fields onshore Morocco, small reserves, but indicates the high success rate on shore, where reservoirs are thin , compared to the nearby offshore where reservoirs are over 150 meters of net pay. Another upgrade to chariots lixus licence.
Jimmy

Nametrade,
It’s true that predator stated that testing is to be rigless. Yet we understand they have purchased four well heads and while I do not have the details I suspect that mou 1 will need a blow out preventer to be installed before testing which is likely to require a rig, drilling safety is not my area, but because the well was overpressurized it would make sense to install a better bop. Otherwise I am sure they would have performed rigless flow testing before now.

Drilling mud gas shows are generally not considered precise enough to declare a gas discovery, as the gas could have just been a small pocket of gas, electric logs and flow testing are the definitive route to establish hydrocarbons.
Jimmy

MEM.
You make a good point regarding the drilling and test results, what if it’s ambiguous .
So let’s just analyse where the ambiguity may arise.
We know from the mou 1 well that the deeper reservoir horizon was over pressurised requiring a heavier mud weight which penetrated the reservoir and traditional rapid log analysis could not see gas near the well bore, but the drilling results showed high gas readings in the drilling mud. The mou 1 well has also identified a shallower gas horizon which was gas bearing and which was not immediately identified as gas bearing.
So what can be done to avoid a repeat of this situation at mou 2 well.
Firstly, well is being designed from the outset to cater for an overpressurised well, I expect this will include modifications to the logging tools to read deeper into the well bore.
As predator are also planning to flow test mou 1 well, on completion of drilling and logging of mou 2, they could suspend the well for testing and proceed to move the rig to mou1 well to prepare it for flow testing, complete the flow testing of mou 1 well and during this time have third party expert log analysts complete the analysis of mou2 well and then proceed to perforate and flow test the mou2 well.
In these circumstances, communication of the initial mou2 well results will be important and consideration should be given to holding back the well results till third party experts have completed their analysis of the well logs and flow testing can then be performed as appropriate.
At the end of the day we are ideally looking for a minimum of 10 mmcf per day and ideally 20 mmcf per day as that would satisfy the immediate local requirements and generate good cashflow for predator to finance follow on drilling.
Jimmy.

I understand that there will be a comprehensive update to be issued by chariot by year end. All going well with the project.
J

Can we please talk about chariot
J

I would expect that once the gas sales agreements are announced, then bank debt will happen very quickly after that, subject to the usual conditions precedent.
Lots of news before year end.
Jimmy

Thanks Keith
J

With regard mou ne oil prospect what is the evidence that the carbonate rocks have reservoir properties as I understand most of the offshore wells did not find carbonates with reservoir properties.
Jimmy

https://www.iea.org/news/europe-needs-to-take-immediate-action-to-avoid-risk-of-natural-gas-shortage-next-year

Thread
See new Tweets
Conversation

Tracy (?????? )
@chigrl
IEA ‘sounds alarm bell’ on Europe’s 2023 gas supplies
https://ft.com/content/90807412-dc98-4e04-b16d-f57f73bbed1b…

The lex column on the back page of the includes a useful review of oil company valuations ,
The valuations are listed as the market capitalisation per bbl of proven and probable reserves. The list includes:
1. Ithaca who are about list at $16 bbl
2. Harbour energy at$11 bbl,and
3. Serica, a gas producer at $12 per bbl
Chariot has a current market capitalisation of £145 million.
The anchois field has audited proven reserves of 635 bcf equivalent to approx 105 million bbls of oil equivalent, of which chariot have 75% = 79 m bbls or $2.09 per proven bbl of oil equivalent.
Let’s assume chariot farms out 25% and the funds cover any equity funds required for a development, then current market capitalisation works out at $3.13 per bbl
This excludes the potential of the low risk prospective resources of 754bcf [125 m bbls gross equivalent ] which have chance of success of between 49 and 63% .
Let’s assume it’s 50% risk so that a risk weighted additional reserve gross of 62.5 m bbls and net to chariot of 46.8 million bbls [at 75% working interest] and 31.2 m bbls [50% working interest].
On this basis chariot is valued at its risk weighted proven and probable bbl equivalent at $1.31 per bbl equivalent [75% working interest] and $1.97 bbl equivalent [50% working interest after farm out]

It should be noted that the chariot valuation calculation are based on undeveloped but proven gas and are compared oil companies in production who are paying substantial taxes on their production.
Chariot earnings will be tax free for the first ten years and the capex loans for development can be repaid from less than two years cashflow for a field that has a life of at least 17 years.

If chariot were valued at $6 per bbl equivalent for its risk weighted proven and probable gas volumes after a 25 % farm out the current market capitalisation would be $502 million in respect of 83.8 million bbls of risk weighted oil equivalent, or £0.44 per share.

The ft article is worth a read.
Jimmy

The end of coal power generating is advancing and that’s good news for gas which provides an alternative base load power supply, great for gas prices longer term.

https://ukcop26.org/end-of-coal-in-sight-at-cop26/

The end of coal power generating is advancing and that’s good news for gas which provides an alternative base load power supply, great for gas prices longer term.

https://ukcop26.org/end-of-coal-in-sight-at-cop26/