Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
For anyone interested in a more detailed overview of the Karoo Basin -- here is a link to one of the more recent research papers on the Karoo shale gas prospects -- that highlights Falcon's proposed permit area with the fewest dolerites and highest probability of shale gas in place.
https://www.researchgate.net/publication/340834283_Shale_gas_in_the_Karoo_Basin_An_opportunity_missed_or_a_future_prospect
Here is a just a fun clip (from an eia.gov analysis on South African shale prospects) on the vertical well that was drilled on the eastern edge of the Falcon proposed permit -- on the Bandu proposed permit. The flow results from the CR-1/68 vertical well clearly indicates the level of gas saturation in the Whitehall (ECCA) formation that is prevalent across Falcon's 7 million acres.
Five older (pre-1970) wells have penetrated the Ecca (Whitehall) Shale interval. Each of the wells
had gas shows, while one of the wells - - the Cranemere CR 1/68 well - - flowed 1.84 MMcfd
from a test zone at 8,154 to 8,312 ft. The gas production, considered to be from fractured
shale, depleted relatively rapidly during the 24-hour test. The CR 1/68 well was drilled to 15,282
ft into the underlying Table Mountain quartzite and had gas shows from six intervals, starting at
6,700 ft and ending at 14,650 ft, indicating that the shales in this area are gas saturated.
Thanks Origin789 -- as it always a good laugh to see the SA gov't promising to pass the exploration legislation -- for the tenth year in a row!!!
It is not surprising to see that Shell has given up waiting for the crooks in the SA gov't to ever pass exploration legislation -- as Shell had other issues with their area of exploration -- over and above the SA gov't's decade long failure to get their act together.
Shell's proposed permit area is covered in Dolerites -- whereas Falcon's proposed Karoo exploration area is almost entirely free of Dolerites. If memory serves correctly -- Dolerites are volcanic extrusions that have most likely burned off most of the shale gas that was in place millions of years ago. and are extremely hard rock to run a drill bit through.
Falcon's proposed area of exploration also appears to have fairly strong confirmation that the Whitehall formation, which covers the majority of Falcon's 7 million acre license, has more significant potential for shale gas in place than the Shell area ever had. There was a conventional vertical well drill many years ago -- (just over the eastern side of Falcon's area in the Karoo -- that sits just inside the Bandu proposed license), that flowed in excess of 1.5 million cu.ft/day.
The last advantage that Falcon may end up having in the Karoo -- is a potential partner in SA that would help to offset the gov't requirement of having a majority black owned company as a partner in any shale gas development. Falcon already has a working relationship with Sasol --who is not only a very successful SA oil and gas company, but also worked closely with POQ when Sasol was the third partner in the Beetaloo exploration program in 2014/16.
While it is good to see that POQ has kept Falcon's options somewhat open in the Karoo -- Falcon is at least three and maybe ten years away from seeing if the crooks in the SA gov't will ever put through honest legislation that isn't designed to steal all profits from any Karoo shale gas developers??
Northern -- if we get good flow rates from the 1/2km frack on the Shenandoah well -- I am sure that we will get a bounce on the share price. However, before the fiasco with the Amungee H2's pathetic flow rates we were trading at 18 cent CDN with the real potential to move up to 30 cents if that H2 well had worked as it should have.
Now, we are trading just below 12 cents CDN with a possible move up to 20 cents with good results would be my guess. It is a shame, but Riddle's wasting of $40 million on the H2 well and Tamboran's serious lack of forward capital has hit Falcon pretty hard by taking away what was looking like a strong move up in the early spring.
That being said -- if we see flow rates from the 1/2 km coming in at stellar numbers of more than 3mm cf/d -- then there is a chance the market will slowly start to recognize Falcon's value and we could move closer to 30 cents CDN -- hopefully??
The following was posted by Smallfish to the HotCopper Tamboran board last week. My apologies to Smallfish if he didn't want this posted to Falcon's LSE board, but Smallfish's comments seemed worth repeating here as it would be interesting to hear Hardrock's thoughts on what Smallfish has stated -- see if his assessments on the DFIT tests are somewhat similar??
Smallfish wrote on the HotCopper Tamboran Board:
"This is positive news, the density of freshwater produces a pressure gradient of 0.433 psi/ft (or 10 kpa/meter in a useful unit system). The reason this matters is it dictates the formations ability to lift water following a frac. If the pressure in the reservoir doesn't exceed the net effect of the density of the water additional means are required. To be clear, you need to overcome the density of the water...and it is not fresh.
The other reason it is good news is that it enhances the the volume of gas stored in the pores space. There's more air in a tire with 54 psi than one at 43 psi, and that helps productivity.
Last, it indicates that the mechanisms that keep the pressure high within the shale are intact and similar to globally productive shales".
Scinceday1 -- in the past we have always had a press release from POQ once the Condor crew and all the equipment are on site and the fracking process has started.
I am expecting a press release any day now, but not too surprised by the small delay so far! Tamboran and Falcon will want to be sure that Condor has everything they need by way of equipment and supplies (pumping trucks, sand, water, chemicals, and possibly nitrogen) on site -- all the way from Brisbane -- before fracking gets started.
Hardrock -- that $30 billion is most likely pretty close to the correct number that Riddle is going to need for his LNG plans up in the middle arm -- when looking at how much Inpex spent on the first two LNG trains in Darwin??
With a current mark cap of $200 million -- Riddle would only need to sell a couple 100 billion more shares to get his LNG plans started. Some level of commercial gas flowing might just be necessary toi get the next billion shares sold first however -- LOL.
Just for a minor bit of clarity on this post about Falcon and South Africa.
The reference to Falcon is 8 years old and goes back to when POQ was hoping to see the Zuma led South African gov't finally get around passing the promised oil and gas legislation that had been promised for years!! The meetings weren't so much about easing the existing regulations about fracking -- as that legislation for fracking had not been passed (and still has not been passed by SA ten years after being introduced) was strickley about allowing exploration (only) to finally get started in the Karoo.
"Zuma indicated he would make calls to address the situation. In a pivotal 2015 meeting at the Sheraton Hotel in Pretoria, Myeni allegedly revealed her efforts to have the National Prosecuting Authority drop the case against Bosasa.
MYENI’S LINKS TO FALCON OIL AND GAS
The Commission’s findings indicate that Myeni wielded significant influence over Zuma and facilitated meetings with entities like Falcon Oil and Gas.
This company sought Zuma’s support in easing fracking regulations in the Karoo"
This last statement is political crap -- as there were no fracking regulations in place and still are none for the Karoo.
• Tamboran has appointed Ms. Stephanie Reed and Mr. Ryan Dalton as Non-Executive Directors to
the Board of Tamboran Resources Limited, effective 28 September 2023.
• Ms. Reed brings over 15 years of oil and gas experience and serves as Partner of Formentera
Partners, the major shareholder of Tamboran’s Beetaloo Basin joint venture partner, Daly Waters
Energy (DWE), in EPs 76, 98 and 117. She was previously Vice President of Oil & Gas Marketing
& Midstream at Pioneer Natural Resources Company (NYSE: PXD) and a senior executive at
Parsley Energy with a tenure of more than a decade.
• Mr. Dalton brings over 20 years of financial experience including nearly a decade in the oil and
gas industry. He most recently served as Executive Vice President, Chief Financial Officer at
Parsley Energy. He has a background in corporate finance, strategic planning, public and private
capital raising as well as risk management.
• The appointments follow an agreement with Mr. Bryan Sheffield, Tamboran’s largest shareholder,
to appoint two members to Tamboran’s Board following a recent capital raise, which was
completed in July 2023.
Scinceday1 -- ITguy is correct on the importance of the 90 day flow rate!
The 90 day flow rate will give a much better indication of what the decline rate is looking like for the Shenandoah location, and that will be taken into account when calculating contingent resources.
For our purposes -- the only reason we wouldn't get an update on the flow rate after 30 days would be if Riddle had managed to screw up another $40 million dollar well, and delayed the results like he did with the Amungee H2.
However, this time -- with BS and the old Pioneer team hopefully in charge -- we should get flow rates by late November or early December.
Some good news on how quickly that massive H&P rig can be torn down, moved, and set-up again, but seriously disappointing news that the JV partners won't be fracking that Amungee 3H well until next April at the earliest.
This Amungee 3H well should now be drilled and cased well before the end of October, given the Tamboran estimate of 25 days for the H&P rig to complete the vertical and horizontal legs. The weather in late October and all of November is absolutely fine for the Condor fracking crew to come in by the end of October -- especially given that the Amungee H3 sits right beside the up-graded Carpenteria Hwy -- with absolutely no issues whatsoever about weather related access to and from the Amungee site.
This unbelievably negligent delay in fracking the Amungee 3H has nothing to do with the weather in the Northern Territory, as there are generally only 9 days of rain in Darwin in November each year (and Darwin is typically wetter in November than the Beetaloo). This is all about our JV partner squandering ALL OF THEIR WORKING CAPITAL for the past year and now does not have enough funds to pay their share of a simple Condor frack job at the Amungee H3 site.
Tamboran is counting on the Shenandoah results being so good that they can go back to the market and raise enough funds to stay in business. If the Shenandoah results are not good (which I don't think will be the case) -- then Riddle is gone and Tamboran will have to do a restructuring with Brian Sheffield and most likely another Texan company taking full control of Tamboran. This Tamboran news release means the H&P rig will also be mothballed for six months and is just another indication of how badly Tamboran has been financially managed -- sheesh.
Darwin NT, Australia
Weather averages -- Overview
Month -- High / Low°C/ days of Rain
October -- 34° / 25°/ 4 days rain
November34° / 25°/ 9 days rain
December33° / 25°/ 13 days rain
Good question Northern, as this stock defines the word "patience" to the darn nth degree!!
That being said -- by Christmas we should have a pretty good indication on flow rates from the Shenandoah well. Given all the superlatives being thrown around about the B shale thickness, the porosity, the higher pressures, and possibly higher TOC numbers -- I believe we will see a solid commercial flow rate.
If that comes to pass -- then Falcon shares should have a very nice pop, but the rise on the share price could be muted to a small degree by the fact that we will still be stuck at the 12 Cdn level. Therefore, a doubling of the share price will only get us to around 25 cents -- whereas if the Amungee H2 screw up had not taken place we might have seen the share price double from the 18 cent Cdn level on commercial flows??
Scinceday1 -- we are about one month to six weeks out from the fracking being completed -- as they are only doing 10 fracks. Not sure why they aren't planning for a few more than just ten across the 500 meters for even better flow rates, but HardRock might have some insight on why not a few more??
After the fracking in complete (won't start for another two weeks -- as Condor has to mobilize all the pumping trucks etc to the Shenandoah site over that short time period) -- then we are looking at least another month after fracking before we get a 30 day flow rate from Riddle. There is a slim possibility that we could see flow results a bit sooner than the end of December -- if Riddle sees stellar results and wants to get the stock price moving off the bottom in advance of the next funding raise??
WW wrote: "Also, it looks like these are much deeper wells than the SS1H well which plays into economics -- though I saw the mention of Empire bringing in these wells much cheaper than the other Beetaloo operators".
WetWater -- Empires wells are actually a lot shallower than either the Amungee Velkerri and even more shallow when compared to the SS1H well. The drilling costs for Empire are truly the best in the Beetaloo, but the shallower depth has helped to some degree. The flow rates for the Empire wells also reflect the shallow depth -- with flow rates that are only in the range of 60% of what the Amungee H1 normalized rate is, but with really great cost controls in place and the lowest drilling cost per meter by a good margin -- those Empire wells should be reasonably profitable once their Pilot Production plans are in place.
Thanks WW, but it kind of makes you wonder about Tamboran's financial position when the next well after Amungee 3H will be a vertical delineation well with no prospect of securing any gas for any pipeline anywhere??? It looks like we are back to the bad old Origin days when every well was just a vertical and here we are 9 wells and 9 years later and still no commercial gas flowing.
Really have my fingers crossed for something close to commercial from Shenandoah!! Without decent flows -- Tamboran is most likely going to be looking at a reorganization with new controlling owners (BS and Texas partners) and a possible reverse split if a new funding has to be done under 10 Aussie cents??
Gonoles -- just an interesting update on how the marketing by Riddle is going versus relative quiet by Falcon!!
Tamboran is now trading at 12 cents Aussie and Falcon is a tiny bit higher than Tamboran on the TSX for the first time. That may not last, but it does beg the question as to how well the past 10 or so hyped-up marketing announcements have worked for Tambo??
Scinceday1 -- as mentioned by BtoB yesterday -- there is reasonable speculation that only fracking the first 500 meters out of the 1000 meter horizontal -- will give Tamboran and Falcon some leeway to go back in and frack the second 500 meter section (if the geotech's determine from the results that the first frack wasn't optimized for the best flow results). This could range from a change in the frack fluids, a change in the overall pumping pressures applied for fracking, or even more sand particles left in the vertical cracks right next to the well bore for optimal flows back into the production tubing??
Contrary to my earlier post from yesterday -- (complaining about only fracking 500 meters) -- I now believe this is a bit of genius and a very practical decision by BS and the technical team -- (with I am sure some input from POQ and Tom Layman). If the flow rates from the 500 meter frack are anywhere around 2mm cu.ft/day or higher -- this will be a very commercial indication for a one km horizontal normalized, and there will be no need to any follow-up frack at all. However, if the flows aren't up to that range -- then the geotechs should be in a good position to study all the data -- and reset for a second frack on the next 500 meter section that has already been drilled. I honestly don't think they will get this one wrong -- after the Amungee H2 fiasco -- and the flow rates from the first 500 meter frack will be more than commercial -- with no need for a second frack unless the partners decide ("in the future") that they want to put that well onto production.
I have to say that I am in agreement with Hardrock on this press release and Cenkos update -- as it just doesn't make sense to spend $40 million Aussie dollars on Shenandoah and then only do a "half-full" frack job. Why spend that amount of money and then never ever be in a position to put that Shenandoah well on to production in the future -- as the darn frack job is going to be half assed -- so that well will just be another $40 million dollars down the drain (and we have had too many of those down the drain wells already)??
The other minor bit of bad news with this update -- as any decent flow rates will have to guessed at (normalized) for a one km well -- which will dramatically reduce any real uptick in stock momentum -- as the market will discount guesstimates on what should be a full 1000 meter frack job --- sheesh.
ANY GUESSES THAT TAMBORAN DOESN'T HAVE ENOUGH CAPITAL LEFT TO DO A FULL 1000 METER FRACK JOB??
"Falcon Oil & Gas Australia Limited’s joint venture partner, Tamboran (B2) Pty Limited will commence a
1,000-metre horizontal section within the shale formation ahead of a stimulation program of up to 10
stages over a 500-metre section, which is planned for Q4 2023".
Hardrock --- here is link below that will prompt you to create your own login portal -- if you want to access Cenkos updates by James McCormick on Falcon at any time.
https://www.cenkos.com/research-portal/?#/portal/cenkos-securities
Beetaloo -- your post is correct as POQ gave us a huge bonus of not being forced out of the Beetaloo (with massive capital outlays) -- when a major potentially takes over Tamboran's position (possibly one of Brian Sheffield's Texas associates). Falcon has the right to participate up to 22.5% in each of the 6400 acre blocks as drilling moves forward. If Falcon does not participate in that particular block -- then Falcon only loses the 22.5% share of revenues for that block only and can wait for what may be better geology and new funding before participating in the next 6400 acre block or not.
However, Falcon will most likely not take any pass on participating in the next two wells to be drilled -- after Shenendoah. POQ negotiated an additional $6.75 million Aussie dollar contribution by Tamboran -- to be credited to Falcon's 22.5% share of one well in 2023 and one well in 2024 (as part of Falcon's agreement not to contest the sale by Origin to Tamboran and Daly Waters Enterprises). These two added payments of $6.75 million to Falcon's side of the ledger by Tamboran -- will reduce Falcon's funding on the next two wells by approximately 33%. This should leave enough capital in Falcon's bank account to cover Falcon's share of the next two wells, including possibly $2 million Aussie on the Shenandoah completion and fracking.
I am fairly sure that if Falcon opts out of the next two wells to be drilled -- that we would lose that added Tamboran $6.75 extra contribution -- so very doubtful that Falcon would opt out of the next two??
Smallfish -- There are a couple of things that indicate that the current Amungee site (or the step out location 10 km further up the highway) will be the next well to be drilled.
The fault line that crimped the very first Amungee H1 well was not encountered when they drilled and cased the Amungee H2 -- so they have both the data and seismic to do another successful horizontal casing. There is also a high level of confidence from the work done during the horizontal leg at Amungee H2 - that the gas is there and in what the data indicates is commercial volumes.
The fracking process on the Amungee H3 will be scrutinized much closer and testing done on the actual frack fluid mix BEFORE the final fracks are initiated -- which should help eliminate some the earlier disastrous mistakes.
The other reason would most likely be the timetable -- as any move elsewhere would require six months of water bore monitoring before an application to the Northern Territory to drill would be approved.