Member Info for LayLadyLay

"Bonasse has been shut down since 2016 cerp have sent a team in to reactivate and are confident stimulation will produce more barrels"

Ghostbusters!

WHY do the three new firms succeeding Petrotrin all have the same three directors, asked new Independent Senator Anthony Vieira yesterday, as the Senate debated the Miscellaneous Provisions (Heritage Petroleum, Paria Fuel Trading and Guaracara Refining Vesting) Bill 2018.

“You have the same people on all three boards. Does that make sense?”

The Opposition had earlier said each company’s directors included Petrotrin chairman Wilfred Espinet and Reynold Ajodhasingh.

Vieira said his concern was for transparency, accountability and good governance.

“I’d have thought we would have got a little bit more information. Do these companies have staff? Do these companies have furniture?

“If these companies wanted to open a bank account they couldn’t do it with the information we have been given in this Parliament.”

Vieira, an attorney, said to open a bank account requires “all kinds of information, down to your address, your projections, all kinds of stuff.

“You get a ‘fail’ for asking me to come here to do this momentous transfer of undertaking, and you can’t tell me who the directors are.

“I’d want to know you have three boards in place of people who are eminently qualified to do the things that you are taking from Petrotrin and giving to this operation.”

Saying he would nevertheless support the bill, Vieira said, “But I think a lot more information is required in keeping with the transparency, accountability and good-governance formula.”

https://newsday.co.tt/2018/11/22/senator-why-same-directors-for-3-petrotrin-legacy-firms/

Texas Is About to Create OPEC's Worst Nightmare.

The map lays out OPEC’s nightmare in graphic form.

An infestation of dots, thousands of them, represent oil wells in the Permian basin of West Texas and a slice of New Mexico. In less than a decade, U.S. companies have drilled 114,000. Many of them would turn a profit even with crude prices as low as $30 a barrel.

OPEC’s bad dream only deepens next year, when Permian producers expect to iron out distribution snags that will add three pipelines and as much as 2 million barrels of oil a day.

“The Permian will continue to grow and OPEC needs to learn to live with it,’’ said Mike Loya, the top executive in the Americas for Vitol Group, the world’s largest independent oil-trading house.

The U.S. energy surge presents OPEC with one of the biggest challenges of its 60-year history. If Saudi Arabia and its allies cut production to keep prices higher, shale will thrive, robbing them of market share. But because the Saudis need higher crude prices to make money than U.S. producers, OPEC can’t afford to let prices fall.

Cartel Squeezed

So the cartel finds itself squeezed between the-sky’s-the-limit U.S. output and softer demand growth. The 15 members, and allies including Russia, Mexico and Kazakhstan, will discuss the possibility of their second retreat from booming American production in three years when they gather Dec. 6 in Vienna.

OPEC helped create the monster that haunts its sleep. After it flooded the market in 2014, oil prices crashed, forcing surviving U.S. shale producers to get leaner so they could thrive even with lower oil prices. As prices recovered, so did drilling.

Now growth is speeding up. In Houston, the U.S. oil capital, shale executives are trying out different superlatives to describe what’s coming. “Tsunami,’’ they call it. A “flooding of Biblical proportions’’ and “onslaught of supply’’ are phrases that get tossed around. Take the hyperbolic industry talk with a pinch of salt, but certainly the American oil industry, particularly in the Permian, has raised a buzz loud enough to keep OPEC awake.

https://www.bloomberg.com/news/articles/2018-11-21/opec-s-worst-nightmare-the-permian-is-about-to-pump-a-lot-more?cmpid=socialflow-twitter-business&utm_campaign=socialflow-organic&utm_content=business&utm_medium=social&utm_source=twitter

steward1 - Does anyone know if the target of 3000 bopd for Goudron is a new one? If it's not new, I seem to have missed that!

It's interesting to note, steward1, that at the LGO ACIEP presentation in April 2015, slide 12 indicated provisional primary and secondary production forecast (P90), which is akin to a CERP roadmap of sorts. Peak primary production was envisaged to peak at just over 3,000 bpd in 2016, falling slightly to circa 2,800 bpd in 2017 then waterflood in 2018 raises 'potential' production to a heady 5,500 bpd in 2018, 7,500 bpd in 2019 then declining somewhat in subsequent years.

Of course we know from history that none of this went to plan and the target production rates were never reached. The moral of the story is that one should not take for granted that 'potential' can be realised in the real world. It's good to have targets and a roadmap against which we can measure the milestone achievements but beware of having expectations where hopes are more appropriate.

capitalidea - Did LK say that oil price just below $50/barrel was the sweet spot for profits.

I don't thinbk he did. It was in4cedros who referred to NR mentioning the supposed 'sweet spot'. The fact is that at $50 per barrel SPT kicks in.

The SPT was originally introduced as a windfall tax kicking in when oil prices reached $50 a barrel or higher. As a result of inflation over the years, together with oil market changes, $50 a barrel is no longer seen as exceptionally high price level. Since the SPT is levied on revenue, not profit, it is seen as particularly onerous. Companies say at prices of under $40 a barrel (as experienced during early 2016) they have difficulty operating profitably. Things begin to improve as prices rise above $40, but in the $50-60 range the extra tax burden of the SPT kicks in and pushes them into a “poverty trap” from which they cannot escape until prices move up beyond the $60 a barrel mark. This creates significant uncertainty over the financial consequences of the eventual oil market recovery. A recovery which sees prices hovering consistently around the $50-60 range would intensify the negative poverty trap effect. For this reason the Energy Chamber of Trinidad and Tobago, which represents companies active in the sector, has been suggesting potential amendments to SPT. One solution might be to taper the tax rate, so that the poverty trap effect is reduced.

Teacup - a carrot to add to your cabbage, banana and pineapple analogy :)

OIP estimates - a carrot for investors? (Teacup will appreciate this). It would be interesting to know what is the basis for these estimates without having first drilled a test well. I presume it is based on the Arkex survey carried out before ARKex Ltd went into administration? It will be interesting to see how the future unfolds and how accurate is the estimate of OIP at multiple targets. Do not confuse OIP with reserves as the meaning is not the same.

Knowing you have crude oil or natural gas on your territory is one thing, calculating how big your reserves are is quite another.

Suppose that your geologists have used seismic imaging to pinpoint the likelihood of oil. That's a technique in which sound waves are fired into the ground, and the reflected waves allow the geologists to build a picture of the rock types underground. Oil will usually be found trapped in porous rock formations covered by impenetrable rocks.

So your seismic imaging has indicated promising geological conditions, and you drill an exploratory well. That produces oil, and you think you might have a real bonanza.

Manochehr Takin, an analyst with the Center for Global Energy Studies in London, cautions that this is where things start to get complicated.

"It is important to know what is the size of the oil and gas deposit you have discovered, because when you drill a well into the subsurface and find oil, it's as though you have this huge mass of [material, like a haystack,] and you have one needle, one long needle which goes down and gives you some information, but how do you know the size of this haystack?" Takin says.

Governments can unwittingly or knowingly exaggerate the extent of their resources. The bigger the resources, the more clout the nation has in the world, and the greater the chance of attracting investment.

The experts, according to Takin, have learned to interpret signs. For instance, how thick is the rock layer where the oil or gas was found? What is the pressure of the rising oil, at the bottom of the drill shaft, compared with at the top of the shaft? Does the flow decrease in the hours and days following the strike?

"All these things have to be interpreted, and then you can come up with estimates, and in the end you still only have one well, so other wells have to be drilled, so it is a complicated process, and one can be a long way off [in terms of accuracy]," Takin says.

https://www.rferl.org/a/How_Do_Experts_Estimate_The_Size_Of_Oil_And_Gas_Fields/1330630.html

Investors have gone from contemplating the prospect of oil at $100 to sub-$50 in less than two months. No wonder global markets are playing catch-up.

https://www.bloomberg.com/news/articles/2018-11-14/crude-s-collapse-is-sending-shockwaves-across-global-markets

Reading today's posts, it looks like the lunatics are in charge of the asylum. You're all too busy trying to bully Ross and not one of you has mentioned the dramatic fall in the price of crude.

March 2017 - 418 million

Today - 830,881,192

Spot on Joe. The posters who talk about filtering other posters are the head in the sand brigade who are only interested to view the company through rose tinted glasses. There's a lot of mythology about the roadmap and what it means. Irene picks up on some of the comments that have no basis in fact and receives abuse for her trouble. I doubt it bothers her too much.

Strangely, those who constantly refer to filtering don't seem to exercise that option themselves. Who are they trying to convince?

Sky's Ian King explains the issues behind plunging oil prices and why there is no end in sight to the declines.

https://news.sky.com/story/oil-bear-market-shines-light-on-us-shale-capability-11549121

EOR potential in Trinidad
November 5, 2018
Trinidad and Tobago

Krishna Persad, founder and CEO of the KPA Group, talks to TOGY about the geology of Trinidad and Tobago and the region, the country’s hydrocarbons profile, and opportunities and challenges around implementing EOR with carbon dioxide injection. KPA Group is involved in geological surveys and exploration in Trinidad and Tobago.

• On venting carbon dioxide: “In Trinidad, CO2 is being vented from ammonia plants. CO2 is being released into the atmosphere at 300 mcf [1.13 mcm] per day. People in the USA would kill for that. Trinidad has just been letting CO2 go into the atmosphere for 40 years now.”

• On incentivising eor: “The ideal thing would be for the government to levy no SPT [Special Petroleum Tax] for EOR projects for the first 10 years. Production has been incremental over the years, due to barriers such as the SPT, which also stifles CO2 EOR investment. If we give an exemption to production from CO2 EOR, five years would be the minimum because of the capex required.”

• On being competitive: “There is a lot more gas to be found all along the margins, including around Venezuela and in Grenada. As time goes on, we can import gas from Venezuela and Grenada, or even from Guyana. Once that happens, Trinidad will be forced to become competitive.”

https://www.theoilandgasyear.com/articles/geologist-on-trinidads-eor-potential/

Brent and WTI have lost 17.4 and 19.7 percent in value respectively from their most recent peaks in early October.

Interesting timing of this announcement . Were CERP sitting on this news until after the general meeting last Friday?

https://www.youtube.com/watch?v=Biu95fyvmLI

Some of you have been known to mention the price of Brent crude. Oil produced by CERP in Trinidad is sold at a discount to WTI so the current price of Brent is irrelevant. However, it's important to understand the difference between the two and this article should make good reading whilst you await the result of the general meeting today at 11am.

WTI vs Brent: What are the differences?

There are five main differences between WTI and Brent:

1. Extraction Location

2. Geopolitical

3. Content and composition

4. Where Brent and WTI are traded

5. Prices and benchmark

https://www.dailyfx.com/crude-oil/wti-vs-brent.html?ref-author=McQueen

My personal view is that the company is short on cash to explore its grandiose plans. Countdemonet says that, "It (LGO) was hyped up by Lenigas and Ritson" whilst forgetting the fact that it's now being hyped up by a different management team that makes the same sort of claims as their predecessors. It begs the question as to whether or not they can walk the walk as well as they talk the talk.

Oil exploration is a notoriously cash intensive business. Yes a significant find can change the parameters to success from failure but you should be wary of thinking that it will be easy or even possible to achieve the heady heights that some of you think is just around the corner. I hope you're dreams come true but be realistic and don't bet all you have on red or black.

When the current placing is confirmed tomorrow, as it undoubtedly will, it won't signal that CERP is suddenly cash rich. There will not be a lot left after costs and repayment of the North Energy loan. Some of you think that Leo said that there will be no drawdown from the Lind facility that expires at year end but if you read carefully that's not what he said.

"The placing provides us with the financial flexibility to pay off the North Energy Loan, thereby simplifying and strengthening our balance sheet. As a result, we will no longer need to drawdown on the 2018 Lind Facility to repay the North Energy Loan."

There could yet be a drawdown although I expect, if asked today, he would say that he doesn't envisage using the facility. If there's not a drawdown then maybe there will be another facility agreed, either with Lind or another lender. Or else the chances point towards another placing in the new year. My personal opinion is that the company is unlikely to be able to move its plans forward from cash generated. This is still a loss making company as was shown in the interims. I believe that costs are still too high and now there is the additonal pressure of falling oil prices to contend with along with any integration problems that may arise from the acquisition of Steeldrum. Dilution will keep the sp low in my opinion, especially if there are any more placings, something that seems not so much likely as inevitable. The first priority of any company is to keep the lights on.

This is just my opinion and not any sort of recommendation or advice. Do your own research and keep your feet on the ground. All the best.

Now, what a different just a few weeks can make. Oil prices are now trending downward, falling for a third consecutive week as global stock markets tumbled and oil markets focused on a weaker demand outlook for crude going forward. Brent crude fell 2.7 percent last week and is down 10.5 percent from its October 3 high of $86.74. WTI ended the week down some 2.2 percent and has now dropped around 12 percent from its recent high of on October 3. Moreover, in a sign of things to come, hedge-fund and money managers are trimming their bets that crude oil prices will rise.

https://oilprice.com/Energy/Crude-Oil/Irans-Worst-Nightmare-Is-Coming-True.html

Disc0verer,

The events of the last few days serves as a reminder of the sometimes difficult environment CERP operates in. The link from 2017 was inadvertent but nevertheless is still relevant in that context.

I have no agenda.

Any thoughts I have about the wellbeing of people caught up in any life threatening situation are personal and I see no need to post them on a share discussion board. It would serve no purpose other than to appear holier than thou.