RE: Mou 3 shallow sands27 Jun 2025 23:58
@PatientlyWaiting. Great username, applies to all of us, some less patiently than others. My opinion only, but the value of successful perforation and test of the MOU-3 shallow A-Sands is not so much in the gas content, as in the change in perception that will result from PRD demonstrating commerciality in Morocco. This proves that gas is there, it can be extracted, and that a deal can be struck for production and sale. This is a small pool of gas, but is sufficient to get a CNG operation up and running - currently there is no market, but Afriquia Gaz have done their homework and have a number of industrial customers lined up.
For calculations of volume and value, I would prefer to base these on numbers used in the January 2025 ITR rather than guesses by random folk on here.
https://wp-predatoroilandgas-2024.s3.eu-west-2.amazonaws.com/media/2024/09/Guercif_-ITR_20240124.pdf
The diagram on p.32 shows how the low/mid/high cases have been calculated based on area of the reservoir - it is unknown if the fault to the northwest provides an effective seal. The ITR volume calculations for all three cases use the same parameters - the measured overpressure of 122psi, and the visually assessed porosity of 15%, as shown on the striplog on p. 26. They do state that actual porosity is likely to be higher, so these calculations are on the conservative side.
Not sure where the suggested figure of 21 BCF came from, for now I am running with the Gross Unrisked Recoverable numbers (what you are likely to actually get out of the ground) shown at the bottom of p.42, multiplied by 0.75 to give PRD's share. This gives 1C (90% chance of being exceeded) of 2.72 BCF, 2C (50% chance of being exceeded) of 6.2 BCF, and 3C (10% chance of being exceeded) of 12.1 BCF. A graph of these volumes / % chances is on p. 43.
Paul has suggested an NPV10 value of $2M per BCF, I agree with that from various calculations I have made using commercially-used spreadsheets. Other companies in Morocco have suggested higher values, but 'they would say that wouldn't they'. [Irrelevant fun fact - Mandy Rice-Davies ended up married to Margaret Thatcher's husband's boss]. This gives a net NPV10 value to PRD of £18m or 2.7p per share for the 3C estimate. That might not sound a lot, but take into account what I said above about the real value.
There won't be any helium in the A-Sands, the gas is of biogenic origin (produced in situ).
A major company interested in acquiring the whole Guercif assets will be interested primarily in the potential volumes. They know that securing gas flow is just an engineering issue - if one approach fails, you can try another in a month. But for volume, the geology has to be right - if it isn't you may have to wait for 100 million years, not a month. At the current stage of development, they would likely pay around 25% of NPV, or around $250M per TCF.
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