Member Info for Penguins

Peter,

you need to understand the difference between connected oil and recoverable oil.

The 11 to 14mmbbls per well is connected oil. To help you here's how UKOG describe connected oil (wizard continues to ignored this) in the RNS of 18/10/2018:-

'a volume of OIP that is demonstrated by collected pressure and flow data to be directly accessed and drained by a well during production. Only part (or a fraction) of the volume, known as the recoverable volume, will normally be recovered to surface during oil production. The percentage of the recoverable volume compared to the total connected OIP is known as the recovery factor.'

Recoverable oil for the Portland at HH has been stated as between 10% and 45% (slide 18 of November 2018 Corporate Presentation), SS used 30%. The 45% depended on full pressure support being provide - at that time 2 injectors for 3 producers). You are using 100% of the maximum connected oil not applying a recovery factor, but the lowest NPV stated by SS.

So going for a mid case of 12.5mmbbls connected oil per well, and accepting 30% that gets you 7.5mmbbls recoverable oil for the Portland - but this is unlikely to be classed as 1P reserves ie 90% certainty.

SS gave a ballpark figure of £15 to £18 per barrel NPV at $70 oil for the Portland so £124mm at £16.5 per barrel or about 1.9p per share (6.75billion shares estimated for 2020, assumes only £5.5mm converted and no further shares issued to Tellurian).

But I suppose you'll say that I always use the worst case scenario.

But of course it depends ultimately on the CPR not SS's guesses.

Ibug

......the gas production graph (in the air quality report, page 35) also illustrates the decline in production - although gas production may not have a linear relationship to oil production. Gas production is about 5% of the start rate by year 9.

Jimmy,

you made this statement:- 'Important to note that this is not BB as we have been flowing here for some time with no sign of large depletion'

So you were the one mentioning large depletion - and I asked you to support that statement - you haven't, end of.

Speak later...…….

What a ridiculous question? Ruth has her own website to promote her views.

If you actually read my posts I have no issue at all with what UKOG are doing - in fact I look forward to some 'hard' (ie CPR) information about the Kimmeridge, and Portland at which point it should be easier to assess whether to sell or buy more (oakleak - work it out).

But answer me this - are you Eyesonthepriz12, be truthful? He/she seems to have an obsession with my posts, keeps thinking I'm Ruth, and has similar tweets (and timing) to posts.

PS I don't actually care who you are - just another in a long line of posters (and tweeters) who spend too much time on this board.

As for redheadedrager - unfortunately you are quoting pressure - not depletion.

and actually none of those quotes talk of a stable reservoir pressure anyway. Producing only 200 odd bopd and still getting pressure drop - what will happen when they are producing 2 to 3 times that - or even 2 to 3 times the calculated rate of 362bopd.

Jimmy,

where did I mention long term depletion?

anyway out now, have fun.

Jimmy,

could you point out where in RNS recently that UKOG have stated that there is no sign of large depletion, or any mention of what is happening depletion-wise?

There are several reasons why UKOG might buy out the partner in the licence and fellow shareholders in HHDL (and elsewhere) - one of which is that they wanted to get out because they have more knowledge of the testing and nobody else would buy, even at 'bargain' prices.

Until a CPR nobody knows what the true value of HH is, what flow rates are likely long term from horizontals, and until another site successfully tests the Kimmeridge HH remains the sole site in the Weald producing oil from the Kimmeridge.

However HHDL have indicated likely long term depletion of total output from HH, which of course is completely ignored by posters on this board and twitter.

The argument that spending (other peoples) money on Arreton etc means they will be sure fire successes certainly wasn't true when posters were claiming SS wouldn't continue spending money on testing Broadford Bridge if it wasn't going to be successful. Of course UKOG have said they will return to BB, but has yet to submit a planning application to do so.

Arreton, Godley Bridge (Loxley) and Broadford Bridge will be at best appraisals of unsuccessful earlier wells, not sure fire certainties.

So another interesting RNS.

Oil production through August up to midday 30 August was 36559 minus 30,618 (reported in RNS 1 August) = just under 6000bbls in 29.5 days, so average production equalled just over 200bopd despite the final 2 days burst.

We also learnt that after the rig arrives it will take 30 days to drill and core HH-2 pilot hole, and following that the horizontal will be drilled which with a test completion to install means earliest test results from the Portland horizontal will be mid November if not much later.

Whilst I'm criticised for pointing out the information available in RNS it is this information that a lot of investors and possible investors should take away from the RNS, not what the 'heroes' of this board who's mantras are short term test rates or excitement that a rig (expected since early 2019), finally turns up.

Whilst the order of events has changed, the 8 August RNS said the Tellurian SPA would be after the loan was drawn down, according to the same RNS the loan was needed to pay Tellurian so unless they've found some spare change down the back of the sofa they now need it to pay for the rig so maybe the loan needs triggering next?

Wizard,

as the 11 to 14 mmbbls is contacted oil per well with only 2 Wells this is 22 to 28 mmbbls (less than3 Wells contacting 7 to 11mmbbls).

What is likely to be recovered of this contacted oil may remain the 30% quoted by SS although only one injector may reduce this. So between 6.6mmbbls to 8.4mmbbls at 30% not the 10mmbbls quoted by SS for 3 Wells.

FYI the 7 - 11mmbbls was not from a CPR.

There have been a lot of posts today - have any commented on the planning RNS apart from that planning for 25 years (actually 20) of production has been granted?

Good news but as usual UKOG has managed to quell enthusiasm by stating that after HH-2/2z the next Portland wells wouldn't be until 2020, and no suggestion that Kimmeridge HH-1z will be drilled any time soon - although maybe they are breaking the news gently that HH-1 will be a donor well for the second Portland well 'Planning approval also exists to sidetrack the HH-1 well horizontally into either the Kimmeridge or Portland oil pools.'

They also seem to be shy of stating a specific flow rate for the Portland - just saying 2 to 3 times the vertical well - no longer followed by 720 to 1080bopd, which was based only on a calculated rate.

There's also a suspicion that Tellurian and/or YA have commenced forward selling, although it's possible these are leftovers from previous share payments taking advantage of the higher SP, for example there were 333,333,330 placing shares at 1.05p in March. But regardless, despite comments to the contrary, even with nearly 300million shares traded these sales may also be dragging the price down.

Phil7390,

Apologies. I thought the planning granted today wouldn't apply retrospectively to the wells about to be drilled - the company says it will - I was wrong.

Phil,

quite selective with your extract. Those were initial rates reported 10 October 2018 for the KL3.

In November this was stated:- 'KL3 produced at an initial metered sustained natural flow rate of 771 barrels of oil per day ("bopd"), with a maximum recorded half hourly rate of 902 bopd. The average sustained daily rate over the full test period was 342 bopd.'

In January (16), the rates for the comingled (KL3 & KL4) test was:-

'Following the installation of a new downhole pump and an optimised surface hydraulic pump unit, stable commingled production resumed on 7th January at an increased initial rate of 525 bopd. The sustained daily rate over the subsequent week averaged 303 bopd. A de-waxing treatment applied on 14th January led to an increase in hourly rate to 351 bopd. Commingled production continues.'

So an average rate of 303bopd using an optimised surface pump unit and new downhole pump, and after dewaxing 351 bopd (an hourly rate).

The 1st August RNS:- 'Kimmeridge oil flow was re-established at initial half-hourly metered rates of up to 332 bbl of oil per day ("bopd"), with continued stable production of dry oil at daily rates of 200-266 bopd.'

So 563 to 771bopd initial rate in October 2018.
November 771bopd with a max of 902bopd but average ate of 342bopd
January initial rate 525bopd, but average rate of 303bopd - raised to an hourly rate of 351bopd after dewaxing
August (after shut in while ewt of Portland) initial rate 332bopd, stable rate 200 to 260 bopd (doesn't sound that stable).

These rates show a decline from test to test.

After the shut in for tank shifting maybe they'll be a nice initial rate.

One further thing production permission will not retrospectively change what is allowed during the ewt of HH-1 and the drilling and ewts of HH_2/2z and HH-1z.

redhead,

dismissing another posters opinion won't change the outcome tomorrow so calm down.

Perhaps it is unlikely they will refuse planning but the conditions may mean they postpone until another meeting.

but my main reason for posting is to reply to your post yesterday where you claimed that the 16 then 12 HGVs during production...….'COULD be caused by demobilisation of the rig and site clear down post drilling and switching to managed production' - rather than oil tankers.

Well as the plan is that the 4 months before full production starts and after drilling finishes will be for the installation of production equipment, and before drilling the 4 production and 1 injector wells there is a three month period for well site modification and new construction works - I think very few of those HGV movements won't be tankers.

Depletion,

although real information on depletion there are 2 sources that suggest it will be quite high.

HGV movements show a drop of 25% after 4 months (16to 12), and a 33% drop (12 to 8) over the next 24months. There is also a gas production graph showing a similar decline.

These are both in the planning documents.

…….stock tank Tetris.

Legalease,

But there hasn't been a steady rise in the SP over the past month. The SP rose to a mid price of 1.125 on 9 August from the low on 7 August although it didn't close at that price (1.075p).
The SP has shifted up and down since then but certainly not a steady rise. At least it hasn't dropped.

That was following the announcement of the purchase of Tellurians share of the HH licences and an interview suggesting that deal would be completed in a couple of weeks and the rig would arrive shortly afterwards. It took 3 weeks for the crane to turn up to shuffle equipment around on the site and a month later still no announcement the deal, that eywsontheprize on twitter helpfully suggested would take 30 seconds to sign off, has been completed.

Presumably the crane is still on site keeping busy playing a game of stock tank Terri's until the rig turns up.

jmhy (8.75p 01/11/2019)

they are on twitter.

tweeted this about my earlier post:-

'Probably the worst of her misleading statements: "The Kimmeridge is ... continuous … drilling anywhere should yield results." 'Results', obviously, can vary - else #UKOG would drill 1 well & get a P2 CPR for whole acreage. Bird brain.'

That was exactly thr point I was making – thanks.

As I posted:-
‘The Kimmeridge is supposedly a continuous resource, which would normally mean that drilling anywhere should yield results.’

For some reason you missed out the word ‘supposedly’, you may not agree that drilling anywhere in the Weald with Kimmeridge will be successful, but many here seem to.

I then go on to consider a reason why:-

‘Obviously BB showed it isn't that simple but to refer to an 'untested feature' suggests that there is more to it, HH is on a 'feature', and BB was drilled deliberately where there was no 'feature'.

You also seem upset in another tweet that I’m taking the word ‘feature’ as referring to a structural feature when I referred to this statement from UKOG (28/06/19 RNS) 'lying within the largest untested Kimmeridge feature in the Weald Basin’.

I posted:-

Obviously BB showed it isn't that simple but to refer to an 'untested feature' suggests that there is more to it, HH is on a 'feature', and BB was drilled deliberately where there was no'feature'.

You tweeted:-
‘BB was drilled where there was no trapping mechanism and no overlying Portland resource. 'Feature' could mean anything. So what?’

well I understand 'feature' in this instance to mean structural feature - as do UKOG (from 23/01/19 RNS about the Godley Bridge Appraisal well, AKA Loxley) :- ......fall within the largest untested Kimmeridge geological structure in the Weald Basin.

About your map (see link below) showing the area within PEDL331 I assume you believe Arreton East could be hidden in. Unfortunately to the east ('on trend') of Arreton Main your polygon is mostly filled with......…...…. the Arreton Main structure - the yellow/orange coloured in area that the contingent resources are calculated for.

https://twitter.com/EyesOnThePriz12/status/1168869756553838592/photo/1

Rodders obviously doesn’t understand that east of the Arreton Main oil find means the structure not just the well. His area, if you overlaid the structure map that eyesontheprize has tweeted it is actually more or less filled with the very structures Arreton East is meant to be as big as (Arreton Main and South). Anyway Arreton East is meant to be....................to the East of Arreton Main. Rodders Map:-

https://twitter.com/rodders_jones/status/1168893040582414337/photo/1

Enjoy...

Peter,

Yet another poster posting faux analysis of another poster., but carry on playing the man and not the post.

So what is your view of the Arreton East Prospect, do you think the loan will be triggered before the rg turns up, will the crane leave the site before returning to erect the rig. Will the next well be drilled immediately after HH-2, what about the Kimmeridge is it confined to structural features as a target or is it really a continuous resource? More to the point what is your reasoningfor your view?

As for your post where you change the subject what time frame do you have for extra wells and no need for pis cash?

Bridgedogg,

The likelihood of drilling any well immediately after HH-2 / 2z is very low. HH-1z is hardly mentioned and UKOG have made it clear that the Portland will be prioritised, but they will want to test HH-2z before selecting a subsurface target location for another Portland horizontal.

I may be wrong but I expect the crane to leave the site prior to a hopefully short interlude while UKOG triggers the loan and completes the SPA, before returning for erection of the drilling rig. From the 01/08/19 RNS:- '....except for two short shut-ins to enable the moving of oil storage tanks and installation of the drilling rig.'

The IOW continues to intrigue me as there is no space to the east between the Arreton structure and the coast (the licence boundary) for even a tiny prospect, but offshore to the east straddling two offshore blocks there was a lead on trend with Arreton identified in a report on UKOGL, we shall see when more details emerge of Arreton East.

The very last sentence of your copy and paste is interesting:- 'lying within the largest untested Kimmeridge feature in the Weald Basin.'

The Kimmeridge is supposedly a continuous resource, which would normally mean that drilling anywhere should yield results. Obviously BB showed it isn't that simple but to refer to an 'untested feature' suggests that there is more to it, HH is on a 'feature', and BB was drilled deliberately where there was no 'feature'.

Redhead,

I assume you didn't bother to check yourself what I posted and what Ibug posted.

Did you look at the mapping in the presentation, did you check what area PEDL152 Covered, did you go look at the relinquishment report?

Do you believe what anybody posts on here and tweets without checking

Ibug,

But the area previously covered by PEDL 152 is not in the licence area that UKOG has. Look at the licence map on UKOGs Web site. Also the mapping shown in the relinquish document is north of the Purbeck - Isle of Wight disturbance - north of the disturbance on the IOW there is no Portland or Kimmeridge.

There is simply not enough room for any prospect to the east of the mapped Arreton closure and south of the disturbance of any size.

Has anyone actually looked at the IOW mapping that's been published in the Corporate Presentation November 2018, slide 18.

'UKOG's subsurface team have also recently identified a further large undrilled anticlinal structure, the Arreton East Prospect, another look-alike to the Arreton discovery and lying further to the east along the same geological trend. Initial mapping shows this feature to be many times larger than both the Arreton oil discovery and Arreton South prospect combined. Further work and potential recoverable resources will be reported in due course.'

The map shows Arreton Main closure to be at least 5 miles east to west with the eastern edge only about one mile from the coast (ie the edge of the licence).

So there's no room in the licence on the IOW for any prospects, even much smaller than Arreton Main) to the east of the prospects already mapped.

So is this prospect outside the licence area - ie offshore (seem to remember a prospect to the west of the island being relinquished).

Don't know if this has been pointed out before, too many posts to plough through, but the actual price on the date chosen in every previous guess the price has been at best in the bottom quartile if not below the lowest guessed price. Whilst I doubt seadocs will be reached these 'competitions' seem to jinx the SP.

My guess which isn't an entry because it isn't a defined price is less than 80% of the guesses.