Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
notaflipper
Thanks for the info.
This will be interesting.
There is still a long way to go.
Ron
notaflipper
Thanks for the info.
This will be interesting.
There is still a long way to go.
Ron
Slip.
Hur have not always been a one well investment.
Far from it but it is at this time.
The future is not always predictable.
Ron
Lancaster Well - 6
There is no doubt the performance of well 6 is very important to Hur in the short term before other measures can be implemented.
The company have choked the oil flow now and use a pump to limit the water intake.
I have seen very little written about what happens oil wise in the reservoir with this revised set up.
I have read some posts in BBs forecasting the well watering out and water cut increasing exponentially without any technical back up to justify these. This suggests to me there maybe a motive behind these posts or they are personality driven.
I do not have an oil industry background so I do not write from experience or inside knowledge.
I give some thoughts on the matter, I am not sticking my head above the parapet to be shot at. I am raising the subject hoping better informed posters can provide useful information and ideas to give a better degree of confidence in the performance of this well, in the short term, to investors.
The use of a choke and a pump I assume is to reduce the effect of the reservoir pressure and that of the water. My take on that is it may encourage more oil to flow laterally from the sides than before.Looks to me that the more oil that flows laterally from all sides of the FB reservoir [reserves and resources] and the sandstones then the slower the water level will rise over that now larger area.
A sandstone reservoir would be more predictable than a fractured granite one as far as oil flow is concerned. The fractures will have varying resistances to oil flow and to the direction of oiflow. Determining accurately how the oil flow behaves I would think is impossible.
It is very interesting that the Hur team are pretty sure that the drop in pressure measured at Lincoln is due to the oil production in Lancaster. This could mean that Lancaster will be receiving pressure support from Lincoln which is I believe is a considerable away. Says a lot about the fracture system between the two.
Whatever is written and said about well 6 the ongoing production results will be what tells us how it will be performing.Results so far are encouraging with substantial revenues being banked. Time will tell how the well performs and how the oil produced declines over time.
The short term production of this well is so important that I believe an update from the Hur team on the anticipated future performance is essential
All as I see it.
Ron
The revised oil/water contact [OWC] level by the new Hur team was a ‘Reality Check’ for me. The new level and the implications for oil reserves/resources appear to have pretty well accepted by most people. Crystal Amber’s theory of perched oil, or similar, below the OWC level will have to wait on facts and figures to substantiate this. Good if they can.
Lancaster well 6 seems to be performing quite well so far by using a pump to encourage oil to be sourced laterally and reduce the water intake. Looks to me that the more oil that flows laterally from all sides of the FB reservoir [reserves and resources] and the sandstones then the slower the water level will rise. Results so far are encouraging with substantial revenues being banked. Time will tell how the well performs going forward.
The price of oil is crucial to Hur’s progress. I am optimistic that the price of oil will be maintained at a reasonable level. It is to a large extent a controlled commodity by the big players. Saudi Arabia gave the other big players a taste of what a free for all could result in. Russia and others I would now expect to be more cooperative in controlling oil production to meet demand. Saudi Arabia has talked about becoming a ‘swing producer’ which would certainly help to stabilise world oil production and price levels. The effects of Covid-19 on oil demand will gradually reduce. That Saudi Arabia episode and Covid-19 certainly did no favours to Hur’s bank balance.
The Competent Persons Report [CPR] may give us an insight on where Hur might go from here. An increase in the FB reserves and resources would help confidence somewhat. An idea of the extent of the sandstone reserves and resources could be a game changer depending on what they are. The proposed connection to Lincoln I had thought to be uneconomic due to the revised OWC being carried over into other reservoirs. Maybe we will get an update on that.
The best way forward that I can see is to look for partners to buy their way into a percentage of Hur’s prospects with cash and oil well drilling.
The West of Shetland is still of interest to many oil companies. They have areas close to Hur’s prospects. Shell said recently that the West of Shetland was one of their areas of interest. Daltry mentioned in one of his posts recently The Peoples Republic Of China . Could they get involved?. A lot depends on the C P R and how experts in oil companies assess the possibilities. I would think this way forward would produce a better outcome for shareholders than a takeover would.
All as I see it.
Ron
RNSTranslator
Thanks for that detailed explanation.
Found it very interesting as I am sure some other posters will.
thanks for taking the time.
Ron
Exerts from Energy Voice 21/09/2020
One of Hurricane Energy’s institutional investors has said the oil firm’s recent technical review, which included a huge downgrade to reserves and resources, was “persuasive but not conclusive”.
Guernsey-based Crystal Amber said it believed “significant volumes” may be present below the revised oil-water contact and that rapid initial pressure decline was “commonly exhibited” in fractured basement reservoirs like Hurricane’s Lancaster field.
Earlier this month, Hurricane’s technical committee revealed phase one of the Lancaster development, west of Shetland, would only produce 16 million barrels of oil, of which 9.4m remained, down from initial forecasts of 37.3m.
The company also reset total remaining resource estimates for Lancaster and the adjacent Lincoln field to about 100m barrels of oil, from more than 1 billion stated in a competent person’s report by RPS Energy in 2017.
Crystal Amber, which describes itself as an AIM-listed activist fund, claimed: “The zone now believed to contain residual oil below the oil water contact is very thick, whereas we would have expected an abrupt change in oil saturation at the free water level.
“Therefore, the fund believes that significant volumes of oil may be present below the revised oil water contact at 1,330 metres.”
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C.A. are saying that they believe a significant oil volume may exist below the revised oil water contact level.
They would hardly be saying this if they did not have good reason to believe it to be likely.
I remember Dr.Trice saying oil could not be fed from below in an F.B. reservoir so it is hard to see how you could have a low zone of oil then a zone of water then oil in the main reservoir?
Does this mean that C.A. are inferring that the revised OWC level has been estimated at too high a level. They would also be inferring that the oil resources estimate is too low.
It raises the question of how C.A. obtained the information to come to these possible scenarios. I do not think they have been mentioned elsewhere.
The comment ‘we would have expected an abrupt change in oil saturation at the free water level’ is beyond me. Maybe someone can expand on this.
Now we have the sudden departure of a main shareholder with board members Kerogen.
Could there be some kind of connection in these events? Who knows but we may soon find out.
Ron
Looking forward to Friday the 11th Septembers IMCP.
Hope to hear the technical committee’s reasons for contradicting Hur’s technical staff and the specialist contractor’s estimates of the oil water contact level and of the oil reserves. These were based on drill results and extensive technical analyses.
Also hope to hear the technical committee’s justification for their own estimate of the o/w/c level and reserves. It did appear as if they were making ‘on the hoof’ comments meeting to meeting. Certainly hope they are not based on conventional thinking in the industry. Conventional thinking had it there was no commercial oil in these fractured basements. However will keep an open mind until the facts are published and the Q & A session is finished.
Expect to get a short term business plan. Where we are heading drill wise, the partnership with Spirit, handling water cut etc.
On a general level the appointment of Antony Maris looks a good move. His experience of drilling FBs and handling the resulting problems should be beneficial to our progress. Would rather get his views on the likes of when aquifer water could be drawn in than using these formulae that are put forward.
Ron
malrees
Thanks for that info.
Clare Slightam has been mentioned before in that role.
The fact she is still there and in an important position is interesting.
How much say Clare has had or still has in the oil/water contact level would be good to know.
It would also be good to know her personal view of the level.
There were so many specialised people and firms involved in the assessment that I believe one person would only have a relatively small influence.
The person with the biggest influence in my opinion would be Dr.Trice.
Apart from his F.B experience and has standing in the industry he was a ‘hands on’ geologist looking at rock samples on the rig and no doubt in touch with the drillers etc. as work progressed. [wonder what his thoughts are on the o/w/c. level]
The big question is are the original findings on the o/w/c level going to be commented on by the present BOD and if they present a different version now a detailed explanation has to be given.
I feel for the shareholders who have bailed out under all the uncertainly with loses in their investment.
I have not sold out, time will if that has been a good move.
Thanks again for the info. good to get it into the mix.
Ron
adoubleuk
Fri 15:47 7/8/20
However, it's not just the 'model' in question, and that's what is so strange. Three vertical wells were drilled with the express purpose of determining OWC: the Lincoln discovery, Lancaster 7 (the 'pilot') and Halifax. These wells were wireline logged by Schlumberger, and the log analysis will have encompassed hundereds if not thousands of man hours by people expert in such analysis. Not just Hurricane people, but Schlumberger, and also the compilers of the CPR's.
And now, all of a sudden, some people have come along saying that all those thousands of man-hours were spent barking up the wrong tree.
And those well logs are as close to empirical evidence as one can get.
Was about to make up a post at the weekend and cover what adoubleuk has said above in very detailed way. My remarks would have been very general as I do not have an oily back ground.
Will use his post above with all credit to adoubleuk.
The reserves have not altered in any way apart from a small % produced at Lancaster.
What we have is:-
[1] An assessment of the reserves by Hur’s technical teams, specialist contractors, geologist and others vetting Hur’s test results etc. and producing a CPReport. Also Dr.Trice an eminent geologist expert on fractured basement with extensive ‘hands on’ experience of the Rona Ridge.
[2] An alternative assessment by a post Dr.Trice technical committee, new CEO etc.
There are experienced geologist in Hur at present. What is not known is if there are any experienced in Fractured Basement plays. Shareholders should be informed of this.
I see this as a serious situation. People and firms involved in the original reserves assessment [which were about to be increased in Lancaster] have their competence and reputations put in question. What they intend to do about it I don’t know.
The present Hur management also have their competence and reputation put in question. They have presented an alternative oil/water contact level without addressing the results and findings of Hur’s previous investigations. In my opinion this must be done.
It would be very much in Shareholder’s interests for the parties in [1] to confirm or otherwise their position on the reserves and comment on the present situation.
While I agree with the new BOD’s policy in conserving funds in the short term their unsubstantiated comments on reserves has undermined confidence in Hurricane Energy.
Shareholders have had a bit of a shock with these latest RNS statements and worry as to the value of their investment. Some have stated they have sold their shares at a substantial loss.
All as I see the situation.
Ron
londoner7
Thanks for the link.
Much obliged.
Ron
Oiler87
To put things into prospective, the largest well on the buzzard platform is currently producing 8,500bpd of oil and 12,000bpd of water.
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Hi, Thanks for posting the above production of the largest well on the Buzzard.
Had posted a month or so ago a request for oil production figures of wells in the West of Shetland that any posters had facts on.
No replies at that time. Maybe that information is not easy to obtain.
The intension was to compare the Lincoln Crestal well test result with other well productions in the W.O.S.
The Lincoln Crestal test result was,
• Maximum stable flow rate of 9,800 stb/d on ESPs
• Lincoln confirmed to contain light, 43° API oil
• No formation water produced.
These results were said at the time to be constrained by surface equipment so an improvement could be expected after everything was cleaned up and the well actually producing.
If we can get more well production results it would help to assess the value of the Lincoln Field and Hur’s 50% of it.
This is obviously a ‘broad brush’ approach on a commercial oil production basis ignoring the differences in types of oil fields and age of them.
Could the value of the Lincoln Field have been neglected to date?
P.S. No need to mention Lancaster 6 well. It should be compared on a worldwide basis.
Ron
Sailplane 9/07/2020
Doing some catch up and read your interesting article.
Not up on reservoir engineering but I am interested.
Repeating part of the article for continuity.
oooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooo
‘’Even when producing 15,000bopd it should only, for example, lift water some 55.6 metres for from 7Z well - (based on a 7Z well PI of 190 stb/d/psi and from the fact water lifts 0.705metres per 1psi pressure drop ), and since the OWC / aquifer is some 265metres metres lower than the 7Z well, it looks to be a big safety margin.’’
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The lifting of water some 55.6 meters interest me.
What arrangement of fractures in the granite are used in these calculations to get that water lift of 55.6 meters?
Is a dedicated fracture assumed to exist from the well to the oil water contact?
I have given an opinion a few times that I just could not believe that the water produced was aquifer.
My take on what happens in the reservoir is,
The oil is exposed to atmospheric pressure in the storage vessel resulting in the oil at much higher reservoir pressure to be discharged [or sucked ] in to the well and up to the storage vessel.
Now the area where the oil enters the well is interesting.
To make my point assume there is no granite in this area then I believe the movement of oil would tend to be like an increasing sphere round the well opening i.e. entering the well from all directions and the speed of the oil movement decreasing as the sphere grows bigger. The oil taking the path of least resistance.
There will obviously be fractured granite in the area so the paths of least resistance will be determined by the fractures. The sphere concept will still apply but modified by the arrangement of the fractures.
Trapped water could be taken in from above, below and to the sides of the well
The granite is particularly well fractured here and we have a fine oil. How is the heavier aquifer water going to be lifted anything like 55.6 meters? No chance as far as I can see.
When the well gets much closer to the aquifer the more likely it will be that water is drawn in.
Ron
adoubleuk
RE: Tech Stuff,18 Jun 2020 09:05
As for your other (generalised) questions. Hurricane was the first to deliberately target Fractured Basement in the UKCS others are now into the act, such as Siccar Point, and BP have a couple of FB wells on Clair, but which haven't performed as well as Lancaster. Also the Norwegians are doing the same in their sector now. But Rona Ridge remains fairly unique, with its own particular characteristics, with the nearest 'similar' formations being in the far east.
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Was also surprised at Dr.Trice’e departure. I looked at the risks and potential and decided to average down. I think it would have been in the share holders interests if he was retained as a consultant with his FB general experience and hands on with Rona Ridge.. Maybe he wanted to be involved in other FB areas.
Pleased you have kept a thread with Hur. Have learned a lot from your posts. Not everyone is as willing to share information and their experience as you are.
Saw your note on BP having a couple of FB wells on Clair and just got round to having a look for them. Not surprised they are not as good as Lancaster. How many wells in the world are?
Had a search for the results of these wells but could not find them. Are they in the public domain? Could you tell me where to find them or advise what they are. Siccar Point would also be of interest.
Would be interested to compare the early result of the Lincoln Crestal FB well of 9,800 bod with other individual conventional wells in the West of Shetland. Some I have come across look pretty small. If any posters can provide the production figures of any WOS wells I would be much obliged. Clair would be of special interest.
ron
LONGWAIT
Agree with what you say.
No dout Lemon Fool would have a negative take on it.
Stopped looking at their site some time ago.
Think they are partly resposible for the negative vibs on Hur.
Did they ever aplogies for the things they got badly wrong?
Ron
Dr.Trice
Will add my concern to other posters on the stated impending departure of Dr.Trice.
Have considered him to be much more than an eminent geologist.
To start from virtually no assets [ apart from personal ones ] to bring his ideas on fractured basement oil plays in the U.K. to where we are today takes a lot of drive , ability, enthusiasm and endurance.
This done against conventional thinking in the U K. Oil & Gas Industry.
No point in speculating on the events leading up to this, we just don’t know what happened yet.
Recent events e.g. such as low oil price, effect of the conovid-19 virus on the economy, instability problem with well 7,delays to the Lincoln field development, the effect on the share price may have all played a part in his departure. They do extend the timescale of Hurricane’s progress.
The above events may have may have led Dr.Trice to decide his journey with Hurricane was finished. He has said that monetising the assets was his aim and would think he had no intention of staying with it as a production company.
World events happen and have to be coped with. Problems in oil reservoirs happen due to the very nature of the work. Dealing with work so far under water/ground just cannot be as predictable as it would be on the surface. Some posters seem to expect things to go without a hitch and problems that arise are mistakes.
Whatever the cause a person with his drive and experience [especially with the Rona Ridge F.B.] cannot be replaced.
I would have thought that Dr. Trice taking up a Consulting Position within the new broader based experienced management structure would have been in the best interests of the shareholders.
It is to be hoped that if Dr.Trice’s connections with Hurricane Energy is going to end in the near future that he gets more recognition for his achievements than a three liner in a company’s RNS.
Ron
SouthSeaBreeze
Enjoyed reading your post. Informative and stuck to the facts.
Never did write Warwick West off. Looked to me that there was possibly a problem with the drilling operation itself. Could not clean up to get a flow rate. Should never have given a natural flow rate result which was probably inaccurate. Gave the Reporters a chance to write it up as a poor production flow rate. Dr.Trice did not come back with any conclusions which might have given some clarity to the situation.
As you say there will not be drilling on GWA for some time. Should have called this GWLA to save confusion.
adoubleuk.
Thanks again for a detailed reply.
Have learned a lot from yor two notes on drilling technoligy Etc.
Would be good to see more of this tech.on the BB.
Much obliged.
Ron
adoubleuk,
Thanks for that very full reply.
Sure that will interest a lot of LTH s.
Can I just condense other questions.
Will the recent advances in MWD / LWD eqipment improve Hurs chances of finding good fractures [hopefuully oil filled ]
Ron
Production Wells
A few weeks ago a poster ‘SCURR’ gave a pretty positive note on Hur and was good enough to expand on that in another note again for me.
He was aiming at those who do not work in the Oil & Gas industry in the content of his note. [ I would be one of these ]
When I read up on both notes and worked out what the abbreviations meant I was very impressed by the implications of the content. I would think interesting for many share holders.
One of his main points is that the MWD [measurement-while-drilling] technology has improved significantly very recently due to developments in the resistivity sensors placed in the bottom hole assembly of the drill string.
This improvement gives much greater geosteering capability and optimal well placement. The result is a visibility of up to 200 feet either side of the well bore as against around 25 feet previously. These tools will allow a more detailed map of the fractures along with steering decisions to be made as drilling is underway.
Could these radical improvements result in a Control Room being established in the rig with drilling being controlled by information being fed up through the drill string ?.
Would imagine drilling times would be extended but the potential to get better information could be transformational to the end results. Daylight would not be an issue so the Control Room could operate 24/7.
I have stuck my head over the parapet here not to be shot at but to stimulate interest in what I see as an area where Hur’s prospects of discovering oil, obtaining better drilling results, and data gathering could be greatly improved.
Would posters with experience and connections in the O & G industry be willing to investigate and develop further?
I do remember Dr. Trice saying at a Capital Markets Day that seismic do not detail fractures but showed the joints. He also mentioned that there was equipment being developed which could be able to show the fractures. Wonder if this is what he had in mind.
Would an experienced shareholder be willing to ask a question on this subject at the electronic AGM?
Ron