The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Bransonbull, no agenda all I've done is present HURs own guidance in a way that shows how they believe well 6 will decline over H2.
Like I said you can't handle the truth.
You want the truth? Can you handle it?
Guidance for H2 production is 12800 to 14200bopd
However we are 2 months into H2 with production circa 17k for July and 15k for August. So to meet the upper 14.2k over the next 4 months production would need to average 13.3k. To meet the lower 12.8k the next 4 months production would need to average 11.2k
Now given September production started near 15k where do you think production will be at the close of H2 on the 31st of December?
Clue it will be around or below the current commercial threshold of 10k bopd if poo remains around $40
Where will this be by the time any intervention takes affect circa H2 2021?
Fair value now that’s a measure and a half!
Until they can prove production can continue economically in 2021 and then beyond fair value to me for equity is 0.00p
Yeah I run two of those hedgefunds, PlantedHBA is my partner in one lol
PlantedHBA, I can recommend a great pub where they have real spirits and a Chinese at Lincoln.
That's about all that's going on.
PlantedHBA,
You're wrong.
My information is dated 11/9/2020 not 8/7/2020 so more up to date.
Still got your truck loaded lol
dspp, exactly. Water cut on 7z touched over 65% in July or 11000 barrels of water per day.
Removing all that water has made the OWC shallower, reduced reservoir pressure resulting in well 6 coning more water.
It's just going to get worse from here.
PlantedHBA no that's wrong.
It was doing 12k with 9% water cut in July with both wells on.
The extra 3k production has increased water cut dramatically.
Yes it was, but water cut doubled in August and continued to climb whilst production declined.
It went from 12k with 9% water cut to 15k with 18% water cut with 7z shut in.
This is just going to continue.
Guidance is for the average over H2 not the daily rate at any date.
Look at page 9 of the presentation and the column showing for August 2020 with just well 6 flowing. It's clear production is declining and water cut increasing.
The data actually suggests flowing well 7z in July has materially altered the dynamics for well 6. This is the voidage issue they alluded to.
Well 6 is now on the same exponential trajectory as well 7z IMHO and won't be in a good place within a few months.
PlantedBHA,
Get in your truck, go to HUR Hq and read the presentation. It's all there on page 8
From the webcast Q&A they require $400k per day to break even.
Current production is 12.8k bopd with 18% water cut.
My opinion is that with POO @ $40 by XMAS they will be producing less than 10k bopd and thus making a loss.
Yes, well 7z is now in water, below the current OWC so when you open the well the pressure difference sucks in water but also oil from the oil zone above.
This is because OWC has gotten shallower with production and coning can work to approx 120m from the well bore in this reservoir.
Agreed, in the Q&A they need 10000bopd @ $40 oil to break even.
Oil production is now on a decline until any successful intervention in Q2 2021 at the earliest.
By then it’s going to be less than 10k bopd maybe even 5k bopd or less.
Equities dead.
Because they thought <1% oil in a sample meant a continuous oil column
Under the investors section.
It's not pretty reading...
Not just the CPR but the companies directors aswell.
OWC was based on samples with <1% oil and >99% water but never disclosed.
They only have 18 months of production left the nothing but costs.
Whose going to pay the debt?
It would be so easy for me to be truly enjoying this moment, but I'm not. I'm sad that many shareholders are going to suffer a serious loss like I did myself.
I tried to put over a balanced view to counteract those who by the truckload were rampant bulls. I put over why I exited months ago and prior to that the possibility that Dr T was wrong and the water was coming from the Aquifer.
I was forever being told I was a shorter with an agenda, which is totally false.
Perhaps those that gave me abuse could find the dignity to offer an apology.