Member Info for KeithOz

Read the CPR, S. 9.1 & 9.31. Separating & squashing plants for He only cost about $50M a shot. At least 10x that for a DLE from brine plant.

At least I got something right - August 30th: "Useful indication of mineralisation at i10, but not at a grade that will have potential joint venturers calling Ben on his red telephone. Seems to be like a small IOCG system, but the complexity and size means that several more boreholes will be required to determine if there is anything worthwhile - I am hopeful that CSAMT will help in getting the positioning right. If they find just 1g/t (1ppm) Au over 100m, I will be more than happy."

Following a chat with Ben, it seems there is a general misunderstanding (including by me) about what is being suggested. Ben is going to set up some shareholder consultation next month, once he is able to present the proposals in more detail. Until that occurs, I suggest we all settle down a bit! My apologies that my tweet/post may have appeared a bit negative & emotional. I'm confident we will all live happy ever after.

Ben had talked previously about a Botswana listing, but always in the context of a being a secondary listing, with primary listing in a major market. I was therefore rather surprised at this tweet:
"Listing here would be a big mistake. #KAV is already here. TSX & ASX are much more complicated than the BSE. We don’t need liquidity for Kanye, but proper backing to go for major #copper discoveries. ???? offers us that @ project level without diluting #KAV"

I responded:
"Ben - I am not aware of any UK, US or Australian broker that offers private investors access to the Botswana market. By listing Kanye just on the Gaborone board prevents most of the KAV shareholders from taking part in the Kanye IPO.

This prevents them from participating in a large portion (ie that not retained under KAV ownership) of any future KCB/Ditau success. We, your loyal long-term shareholders, are not at all happy about that.

If you put this proposal to a shareholder vote, expect a lot of people to vote against it. If you do not, expect a lot of shareholders to sell out. I suggest that your rationale for this proposal needs to be expanded. Regards, Keith"

I would be interested to know (as should Ben) whether members of this BB agree or disagree. Thanks.

@nordell. As a starter for your research, have you considered looking at PRD's announcements? Try this RNS from 20th September 2022:

https://www.investegate.co.uk/predator-o--38-g-hldgs--prd-/rns/mag-mell-project-concept-for-ireland-validated/202209200700189314Z/

There are further links within the RNS.

Part 2.
It looks to me as if the gas cloud/chimney originates from the bottom of the MOU-Fan structure, indicating a fill-to-spill situation rather than a top seal leak. There have also been suggestions that the cloud could be partially derived from a second, lower structure. I take some comfort that PRD have gone to the extra expense and time to obtain high-pressure wellheads capable of coping with an overpressured 300+m gas column.

I agree that getting a consistent flow from an unconsolidated reservoir could be tricky, but PRD have spent a great deal of time, using the best available tech support, to address this issue. I expect that since MOU-1 & MOU-2 are being tested at the same time, there will be some simultaneous pressure testing to determine connectivity.

Imho, the market valuation seems very low compared to the opportunity. Much of this may be due to the unconventional style of PRD management – there are only two guys, and in the past some of the approach to financing & PR has been a little haphazard. The addition of two very well-connected NEDs appears to be improving the situation. I suspect that many CPR readers only go through the top summary, and have not understood the huge impact on the NPV of the increase in gas prices coupled with the CNG low capital, fast commercialisation route.

Reporting of the results from MOU-1 was far from optimal, since the borehole conditions were highly unusual and required a great deal of analysis – indeed, there are many in the market who still consider MOU-1 a duster.

I am expecting a comprehensive operations update by the end of next week, since that is getting very close to the MOU-2 rig mobilisation window. If you do decide to invest, hope that all goes well for everybody's sake! Kind regards, Keith.

Part 1.
Good morning Jimmy. I'm aware of your activity on the CHAR board, since I have recently finished selling down my CHAR holding and reinvesting it in PRD. You have clearly been doing better research than many on this board. A number of your initial questions have been partly answered, and you have raised some further points. I will try to fill out some of those answers in the limited time I have available, since I am currently travelling.

3D seismic has not been performed. The view is that these are shallow wells (max 1500m) onshore, therefore the cost of drilling is low. 3D is expensive, and not nearly as necessary or cost-effective as for deeper, offshore prospects which cost a bomb to drill, as you know from CHAR. The 2D data appears to be of good quality, has been reprocessed on two separate occasions, including AVO (Amplitude Variation with Offset). There are numerous views of the seismic on pages 18 -22 of the September 2022 presentation, including AVO on p.19.

There are indeed a number of strike-slip faults along both margins of the Guercif graben, which has experienced two uplift episodes. As Seabright reminded the board a couple of days ago, these are of the positive flower pattern, which are very positively associated with hydrocarbon trapping. There is always a possibility of structural or water contact compartmentalisation, but the fault locations are known, indeed are guiding the positioning of the drill. Water contact has not been established, but is clearly deep within the whole region – it has not been encountered in any of the historic wells looking for oil, nor in MOU-1. MOU-2 is up dip from MOU-1, further decreasing this risk.

It is quite reasonable to question reservoir thickness, given the thin strata giving a relatively low net pay in MOU-1. However, MOU-1 was on the very margin of a turbidite fan, which seismic data & petrographic analysis from other wells would suggests thickens substantially to the east, as would be expected when you approach the graben wall. I do not know the ratio of net/gross pay, but petrographic data has indicated that whatever the thickness, there is every chance of excellent porosity & permeability.

The 2022 CPR does not give a geological cos. The 25% you quote relates to the commercial cos of a gas-to-power solution, which PRD are not pursuing. The proposed CNG development is vastly cheaper, and possibly 2-3 years faster to commercialisation. The current intention is to lease CNG equipment, and not for end-users to pre-finance.

@Jiminey. Agree with the first part of your post, which is why I picked 5th Nov for TD, announcement on 7th (Monday). As for your second part, I would think it very unlikely that there would not be an RNS before a sidetrack. So, hopefully two RNSs - around 7th & 21st.

Bob, glad you got things sorted the right way round - it could have been "hung Mrs Bob, dumped the washing at work".

We know from last year that this is difficult ground, and that it will almost certainly be necessary to case in stages. The casing takes up space inside the bore, so in order to get the drill string through the cased section you obviously need to use the next drill diameter down for the next stage. It would therefore make sense to start with the largest practical size, in order to give yourself the option to use several casing stages should ground conditions require it.

This cautious approach will minimise the risk of hole instability, which screwed things up last time. It will of course increase drilling time, since the drill string has to be withdrawn each time, the hole logged, then cased, then lowering the string again with the reduced size bit in order to proceed with the next stage.

I am pretty sure that last year Tai-1 started with PQ, which is outside diameter 123mm (roughly 4¾"), inside diameter 85mm, then dropped down to HQ (96/63.5) where it got stuck. I assume they finished off with NQ (76/48). Mineral drills are always measured in metric, gas drills in imperial - HE1's gas rig this year will start off at 8½", equivalent to 216mm, so a very big difference in bore cross-sectional area, which is the factor that counts.

So that's all OK then. Perhaps certain people can be a bit quieter on this board now.

Timing - PRD have a habit of issuing important business update RNSs on Tuesdays (60%) or Thursdays (30%), most usually in the middle of the month. If they are going to meet the previously announced drilling & testing timetable, they will need to have the rig under their control by the 18th, with mobilisation by the end of the following week. That in itself would require an RNS.

As well as rig contract, mobilisation & spud date, I expect to see updates on MOUs/contracts for gas offtake and CNG equipment leasing - perhaps contracts whose activation is conditional upon a certain minimum gas flow. If the drill location has been changed, it would be nice to be given the rationale. Finally, after a Covid extension, PRD are required to relinquish 25% of the Guercif licences area on 5th November, so I would expect to hear details of that imminently.

Location - With regard to my speculation as to the changed position of MOU-2, this potential new position is very close to the originally planned MOU-5. There are two possible drilling scenarios:
* If you wanted to have the greatest chance of success of finding gas, clearly you would drill in the originally announced location for MOU-2 (previously known as MOU-4), which is at the highest point of the structure - gas migrates upwards, so that is where it will be, even if it is only a small amount.
* However, if the recently reprocessed data had strongly suggested that the whole structure was charged, you might choose to take a bit of a gamble and drill where you were most likely to locate the largest column of gas. This would be down to the lowest point of the structure - if there is gas there, then it follows that the reservoir above will be gas charged all the way to the top.

If you take a look at the top diagram on p.9 of the September 28th 2021 presentation, you can see a cross-section of the MOU-Fan, showing proposed locations for MOU-4 & MOU-5, which appear to have been designed to address these two possible scenarios. There doesn't appear to be anything going on at the old MOU-4 location, but something is happening close to the MOU-5 - of course I don't know if that is PRD or just the local farmer preparing to plant olive trees.

Please, I reiterate this is purely speculation on my part, since I have got bored waiting for some news :-)

Immediately to the N of the A2, now joined to it by a short roadway.

Latitude 34.3139°, longitude -3.3932°

Sorry folks, the Sentinel links I posted aren't working properly. Click on either of those links, then use the calendar feature at the top to move between 27/9 & 5/10.

@ Mossma - yes, that's a big, white-surfaced site in the tweeted photo, much like the area seen in the 27th September satellite photo I have linked below. This area now mostly appears to have turned black - could just possibly be the effect of ploughing, but to me looks more like gravel/roadbase for a pad/construction.

I still think all all be revealed Tuesday 18th October (yes, 2022!)

@NN - Yes, that's exactly what I saw. It may just be agricultural, but there is a new roadway in from the main A2 highay, and what may also be a parking area to the east, adjacent to the main road. A little unusual, since there was already road access to this area from the north. I will continue to monitor for developments.

Here it is on 27th September:
https://apps.sentinel-hub.com/sentinel-playground/?source=S2&lat=34.313790332664595&lng=-3.3908915519714355&zoom=16&preset=CUSTOM&layers=B01,B02,B03&maxcc=20&gain=1.0&gamma=1.0&time=2022-03-01%7C2022-09-27&atmFilter=&showDates=false&evalscript=cmV0dXJuIFtCMDEqMi41LEIwMioyLjUsQjAzKjIuNV0%3D

No change on 30th September, but not as clear a picture. Then,
on 5th October:
https://apps.sentinel-hub.com/sentinel-playground/?source=S2&lat=34.313790332664595&lng=-3.3908915519714355&zoom=16&preset=CUSTOM&layers=B01,B02,B03&maxcc=20&gain=1.0&gamma=1.0&time=2022-04-01%7C2022-10-05&atmFilter=&showDates=false&evalscript=cmV0dXJuIFtCMDEqMi41LEIwMioyLjUsQjAzKjIuNV0%3D

I'm just speculating here, don't take this as fact! Based on previous releases, most PRD investors were expecting the MOU-2 pad to be just about finished by now, but we've heard nothing, and I concede that the latest view from the Sentinel satellite does not show any development at the site that was flagged up in the September 9th presentation. Maybe there is an answer hiding in plain sight.

Let's step back a little, to the 19th July RNS:

"The Company is in the process of completing local permitting for the second of two alternative locations for the step-out well to the MOU-1 well which was completed for rigless testing in 2021. The final location will be agreed following the integration of reprocessed 2D seismic data that have recently been received. Civil engineering works will commence this month to construct the well pad for the step-out well now designated MOU-2."

Then in the Sunday Roast podcast on 25th September, at 41m 10s, we hear that permitting has been delayed but all will be concluded within a week.

So there were already two possible well sites going through permitting, despite final seismic reprocessing not having been received. In the last few weeks there has also been mentioned the possibility of a 1000' gas column.

Imagine an inverted teacup, with a hole in the bottom, and on top of the hole is an inverted eggcup. The 295 BCF target resource is in the eggcup, with an estimated 360' gas column. The CPR suggests a potential 708 BCF in both the eggcup and the teacup, with the extra gas coming from a column which extends down to the base of the fan structure, equivalent to the rim of the inverted teacup. This column may be 984 - 1214' in extent, depending on exactly where the upper seal of the reservoir is located beneath the surface. The initial MOU-2 drilling location was based on optimising the eggcup. What if the final seismic suggested that a slightly different, and as yet unpermitted, location would be optimal for the whole structure including the teacup?

If you look at p.9 of the September 8th 2022 presentation, you will see two diagrams on the left hand side, showing the anticipated top and bottom of the MOU-Fan, based on (un-reprocessed) seismic amplitude. The bottom diagram shows the MOU-2 location at the optimal point of the TOP of the formation (base of inverted eggcup), which is great for getting the most gas out of the eggcup. However, if you had seen that seismic cross-section that Methodology had shown on his excellent Reddit summary, and noted the gas cloud (gas chimney), this indicated that the whole MOU structure (teacup & eggcup) is filled to spill. PRD may now have a clearer picture, and have decided to move the location so that they drill to the deepest part of the MOU-Fan - this is shown on the middle diagram on p.9.

This location is 2.3km to the WSW of the expected MOU-2 site, just down the A2 Highway, and immediately adjacent to it. Anyone else see anything there?

@AGD62, Micktrick & GRH. Thanks for clarifying the UK tax issues. It seems obvious that there are very good reasons for option exercise now, rather than in a month or two's time. It also seems obvious that the deramping squad is once again manipulating the facts in order to present PRD management in a negative way. I expect their FUD activity to increase in frequency and amplitude the nearer it gets to drill/test time.