Member Info for PDMSPiper

By OilAnalyst on the UJO board.....

An unusual RNS from UJO and I've held off from forming a view until now on the expectation that UJO or RBD would be doing some of the usual PR/interviews that might provide clarity. But none have followed.
My conclusion is that we are either not going to see any A2 testing until the immediate run up to the drilling, which is likely 6 months away (a 2 well program with testing needs 6 months prep), or if there is an earlier test on A2 it will be only a "proof of oil" test that brings oil to surface and wont be enough to produce a CPR that can report on oil reserves (as opposed to volumes of oil in place). In other words, UJO is playing the market long and news may be limited until the drilling results in Q3 '20. OK for LTHs but not what we're expecting.
Here's the key points:
1. Firstly, SP Angels' Sam Wahib (UJO is a house stock) let the cat out of the bag in the 12th Dec interview. See link ref minute 6-7. "...they will go straight from the A2 testing into the drilling next year..." https://www.proactiveinvestors.co.uk/companies/news/909122/sp-angel-s-sam-wahab-discusses-hurricane-energy-eco-atlantic-tullow-and-union-jack-oil-909122.html
2. Sam makes a wrong statement in saying "...the 3 partners in WN are fully funded". Humber has 16.6675% is not funded beyond the approved 2019 budget for the A2 EWT. Humber has a sales process ongoing for their interest but had intended the EWT to have completed first to at least prove the presence of oil. They do not have funds for the drilling in 2020 and so at this point can not approve the WN budget for 2020. They may well feel aggrieved that the approved test was suspended to allow UJO/RBD to fund raise. Its possible that a proof of oil test will be done and this facilitates a funding of Humber's equity. It also seems unlikely that RBD/UJO will rely on the JOA default provisions as they would find it hard to go back and raise funds again for the same program. Until this is resolved, the budget for 2020 cant be approved and long lead items purchased. This means delay.
3. The RNS says very little about the A2 testing plan or timing: "...The well will be pumped to recover load fluid, directing all recovery through ...the incinerator". This wording implies it is not an EWT, but a short test to bring oil to surface. There is nothing on timing (notwithstanding planning). It is out of character for UJO to not provide detail and expected timing and so we must conclude it is deliberately vague.
4. A concern for the WN joint venture will be that the oil zone has been perforated together with the gas zone and yet the initial test was only reported to have produced some gas. Anyone who knows about well testing will know you always start testing from the bottom of the well and work up. Any new test will need to isolate the gas interval and try and clean up the oil zone where previously it did not flow to surface. This is possible with a pump but is uncertain.
I'm a LTH and

Why would we sell Fairview? Are you deramping? Analyst is clearly advocating a hold.

MickyBee; Thank you for calling me a “Twat” for having the temerity to post an opinion other than the happy clapping norm on here. Analyst appears to have a similar opinion. Is Analyst a twat as well? Sounds informed and balanced to me.

Thank you Analyst. Finally we are having an informed discussion.

How many days do we think this “Extended Well Test” will run for. Normally, the longer the better to achieve a stable flow rate so what are we expecting? 4 days? 4 weeks? 4 months? What is the expectation?

Are you expecting a 3 month flow test here then Jack? Oil tankers? Flaring? An RNS with flow rates?

What is your expectation Jack?

How long after the operations begin are you expecting us to receive an RNS with flow rates?

I know what my expectations are. What are everybody else’s? It will be interesting to find out.

“Is that the same market that took up the £24m placing recently?

I’m sure the ii’s who took it up know far more what’s going on behind the scenes than a layman like you.”

Maybe that’s the case. If so, shouldn’t laymen like me be told what they were told or are you happy with the Billy Graham approach where we all clap along in evangelical bliss while institutional investors in the know take us to the cleaners. We’ve had 4 months of silence followed by an RNS that told us no more than we already know. It’s disappointing. I’m disappointed. The market is disappointed hence the drop yesterday.

The incinerator is a high temperature thermal oxidizer. It is there to burn any organic compounds in the well fluids and reduce odour in the discharge to atmosphere. It sounds like the addiction of the incinerator is part of the environmental consent compliance.
The Flare is a different beast. To my mind going to the trouble of incinerating organics but still flaring off the discharges of the PRVs in over pressure situations seem like contradictory strategies. It will be interesting to see what they actually produce and what data is transmitted to the market following it.
Given Reabolds previous performance on supplying us with flow data from the other assets what are you all expecting from these ops at WNA2?

The market in general thinks the RNS is open to interpretation and not a definitive commitment to conduct and extended flow test of oil to establish a stable flow rate. I agree with the market assessment. I expect this clean up quasi EWT op to take no more than 10-14 days then it will be shut in again and the focus will move to WNB. The RNS even states that WNB is the “optimal location” to test the Kirkham Abbey.
I don’t kniw why the happy clapping moonies are getting so upset. Perhaps they took the placing andcare desperate to hoodwink the market and unload. Who knows. Time will tell. GLA and DYOR.

It’s been discussed to death JD. It was July, not September.

what the incinerator is for, why it’s there and what it is going to burn then you might be in a position to accurately disseminate the information in this RNS. If not, then you need to do some research, do a little more listening to voices you disagree with and do a little less childish mud slinging. I have come to the conclusion that this will be no more than a 2 week clean up op by analysis of the terminology in the RNS and also analysis of what has not been said. We’ll talk again in feb when this operation has been completed after a couple of weeks and you’re all moaning about why there’s no flow rates. Look forward to it.

Time will tell JB but this reads as very spoofy to me. I remain scheptical and in my opinion those expecting flow rata data from this operation will be disappointed. Good luck in your strategy. I’m in but my strategy is not now long term holding here.

It isn’t an EWT. It’s clean up ops.

I would be happy if they had said they had plans to install oil storage tankers for several hundred tons of oil and they had contracted a local oil tanker haulage contractor to take flowed oil to the nearby refinery installations on the Humber. I’d have been happy if they’d said that the well test would be in place for a minimum of the 96 days that was allowed for under the original gas test permit and that we now had permission to flow oil for 96 days to establish a stable flow rate. In that case, yes, I’d be jumping for joy. As it is, I’m not, because they are trying to hoodwink the market by calling a well purge and clean up operation an EWT and that makes me very suspicious. Only my opinion. Take your rose tinted layman’s glasses off.

Sounds more like a purge operation, clean up and purge of drilling fluids. I’m not reading this as a serious attempt to flow oil and conduct a flow test. I doubt it will be in operation for long. I very much doubt any oil will be flowed or any flow rates given. It’s a well clean up. I don’t like it. I doubt the market will like it either. Not a good RNS at all I’m afraid.

UJO have released an RNS regarding a recommenced EWT at WNA2. The details read more like they are going in to purge the well of drilling fluids then it will be shut in and suspended. No mention of how they will deal with flowed oil. I’m not expecting much. Not expecting flow rates or for this process to be underway for any length of time. It’s about time we started to get some verified CPR figures from any of the assets. Still no definitive flow rates or CPR from California. This doesn’t read like a serious attempt to flow test the WNA2 well to me.

What’s the betting that VG6 will be an oil discovery. Of course it will. But they won’t be any flow rates of volumetrics because it will be bigger than expected. They’ll be struggling with an unexpected quantity of gas. Any testing will be postponed while a forward workplan is designed and a gas tie in completed. There’ll be a 5% spike on the sp, followed by a retrace and VG6 will disappear into the bottom drawer of Reabold assets, with all the others, never to be heard of again. No further info ever. Pfffft.

There will be not even the remotest chance of asset sales until the asset is proven beyond doubt to be of suitable volume and to flow at commercial rates. That’s at least a year away. I’ve lost count of the AIM companies ramping the possibilities of asset sales with **** n bull stories of “majors sniffing about” and NDAs signed. Dozens of them. Easy to count the big buyouts that have actually come to pass though where shareholders have received big payouts. I can count them on no fingers of no hands, zero fingers required. Good luck with holding this for an asset sale. I’ll be trading the nuts off it, as will Chris and all the other bullsheeters on here currently ramping the teets off it.

Seeing as the market has already absorbed to volumetrics for WNA2, and sold into the rise it brought, success there is now already priced in. More news at Parta and Cali will have very little effect due to the massive exposure the company now has to West Newton. Even if a WNA2 flow test does go ahead, which is not a given, I don’t see any significant value being attributed to the MCap here until late 2020 after drilling and testing of the WNB wells. We need £20Million+ to be added to the Mcap here to take the share price back to 1p. Nothing but verified success at West Newton is going to achieve that and that will only be after drilling and testing of WNA2 late next year so I wouldn’t make any plans to be enjoying profits here for a long time yet. We’re in for a wait of 8 months plus to see value now.

I know it’s on me. And also on the bod. The bod promised a “news rich period”. I held when heavily in profit because I believed more news was due imminently on both west Newton and the other projects. What followed was not a news rich period but a 4 months of silence and a massive placing. What I’m saying is: After being mugged off like that once most investors won’t fall for it again. My strategy to believe the bod and hold the stock was the wrong one. I should have ignored the bullsheet and sold. You obviously agree, so why are you apparently saying that I should buy into the presentations, interviews and all the other promises, once again? You and I agree it was the wrong strategy last time. As I said, any news will get heavily sold into now. Even more than before. The honeymoon period is over here. Nobody believes their stories of news rich periods and shareholder value. They have failed to deliver already. No question.