Strategy15 May 2019 00:07
Regrettably, the AGM lacked coherence today and mainly because one shareholder in particular kept breaking across JW's presentation and eventually, it became a fire fighting exercise.
Some interruptions, however, from the better informed, yielded interesting information, including a bit of color on the ONGC/AMER working relationship.
Apparently, they have an Operating Committee:
Some items are decided by majority (and that is where ONGC's 70% gives them the muscle) and that determines the order of well drilling
Other items have to be 100% and that applies to the overall program and commercialization.
Once again, it was reiterated that they were looking in the wrong place for the oil until AMER partnered.
Further detail was given on what actually drives the program and it is apparently the need to fulfill the "A3" requirements in the time slot to 2021. It is more important that production, because where the commitment has not been fulfilled, the asset has to be handed back.
For that reason, Sol and the seismic is prioritized over Indico 2 (which is "A2" and does not count)
It was also mentioned that a plan had been mapped out with ANH and that 12 locations had been permitted: if the sites chosen in advance prove not be optimal, it is a small change.
Also mentioned was that they are hoping to get a couple of wells on the Guadalupe trend and as a by line, that the $16m capex is funded out of production.
Re examining the above and the data to hand, it does make sense of CPO-5 and looking at today's news, it seems as if ONGC are finally putting their foot on the peddle to secure the whole block, as wells are now spudding like clockwork, at 3 monthly intervals: Indico, Calao and now Sol.
Put 8 and Miraparriba were mentioned and JW cheerfully announced that the rest of Vetra's assets were rubbish, but Put 8 is the prize, with light and heavy oil. They are going to do their own pad now as the complications of drilling off someone else's pad has a myriad of complications (also mingling light and heavy oil, if I heard correctly) and the additional cost re infra structure is an 800 km road. Whilst accepting that explanation, the overall picture is not of a cosy accommodating relationship with Gran Tierra, on the receiving end of that little ROFR trick.
The other major take that was to be had from the trashed presentation was the emphasis on the OXY deal and that our acreage is bang on trend of the major heavy oilfields: slide 6 of the presentation illustrates. No doubt we would have had a greater share of JW's insight, but for the disruption by a senior citizen, who liked the sound of her own (very loud and self important) voice and wasted, to a large extent, our once a year only, opportunity to speak to the man who is Amerisur.
As ever, JW was rushed off directly after the meeting and that I find that plain insulting: whoever plans his diary on these visits gives no consideration to PIs at all.
GLA
Sign In
Follow the stocks
