Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Hurricane
Was intending to post a note on Hurricane last Friday and then the RNS arrived on my screen.
Had to reassess what I was doing.
How big a problem was it?
We could do without it but trapped water is not all that unusual.
The problem with 7 well is a bit more unusual. Could be we will get more information on the problem and an idea what can be done about it at the AGM.
My view on oil is that the price will rise gradually. Countries like Saudi Arabia will have to adjust their budgets to the reality of the going price of oil. Producing nations have had a taste of what can happen in a free for all which should bring a willingness to limit their activities. America pumping away while Saudi Arabia, Russia etc. control their output, to a certain extent, was just not sustainable. I think it reasonable to believe that the price of oil will rise to a level that a company in Hur’s position can make decent profit. No point in trying to guess the actual future price levels of oil.
I do believe in the quality of the management .It is a small company and needs time to develop the range of skills of a bigger company such as P.R. Presentations etc. I think they have gone a good way to this end. The Annual Report I thought was a good example of this.
I also believe in the potential of the assets. The volume of potential oil bearing fractured granite in the leases looks underestimated to me. The Lincoln Field is big has produced commercial oil flows. The Lancaster 6 well gives a taste of what fractures basements can be like.
What to do? It is about risk and reward. The risks are there all right and so are the rewards. For me the rewards are well worth waiting for. The time scale to realise these has been extended. Can well understand the frustrations in waiting, feel it myself.
Decided the best course of action for me was to average down and managed to buy some shares below 7p.
Friday’s delayed note next.
Ron
Careful,
Operational Update. RNS8849K 27th. April 2020.
It had been planned to commission the electrical submersible pumps during Q2 2020, but COVID-19 restrictions requiring manning levels to essential personnel only have delayed this programme. These pumps are not currently required to maintain production levels, though their testing and commissioning remains a project aspiration for 2020.
Ron
There is a Q&A tab on the Capital Market Presentation Page,
Ron
adoubleuk,
This is the RNS for Lincoln Crestal.
Does the inability to produce stable flow rates with eps not apply to Warwick West.
No matter,Do you recall if the Lincoln Crestal floe rates being constrained by surface equipment.
'Lincoln Crestal' 205/26b-14 Well Result
Hurricane Energy plc, the UK based oil and gas company focused on hydrocarbon resources in naturally fractured basement reservoirs, is pleased to report the results of testing of the 205/26b-14 well ("Lincoln Crestal").
Highlights
· Maximum stable flow rate of 9,800 stb/d on ESPs
· Lincoln confirmed to contain light, 43° API oil
· No formation water produced
· Well now planned to be suspended as a future producer
Testing of the Lincoln Crestal well recorded a maximum stable flowrate of 9,800 stock tank barrels of oil per day ("stb/d") with the use of electrical submersible pumps ("ESPs"). The well flowed at an average rate of 4,682 stb/d under natural conditions. No formation water was produced.
Ron
adoubleuk,
Not sure about the figures you give for Licoln Crestal.
The RNS gives 9,800stb/d on esp and 4,682stb/d on natural flow.
I seem to remember [Biffa I think ] saying the flow rates were consrained by surface equipment.
Can you recall that?
Ron
Sgurr,
Much obliged to you for that detailed reply and taking the time.
I am sure it will be of interst to other posters.
Cant say I full understand it all but you have given me plenty to work on which I will be doing.
Thanks also for so positive on Hur's prospects.
Ron
Sgurr,
Thanks for that post.
I am not in the O & G industry but find it very interesting specially as regards HUR.
Good to get some in depth technical info.like this.
Would be great for me and I would think some other shareholders if you would expand a bit on your post.
What does the MWD technology do for you in practice.If drilling a vertical well does it help to locate the best location for a horizontal production leg for example.
I you could expand on the actual benifits for Hur with regards to their drill locatiosns etc. would be much obliged.
Ron
laserdisc
25 Mar '20 - 15:37 - 13731 of 13743 0 9 0
rns 2017
HTTPS://otp.tools.investis.com/clients/uk/hurricane_energy/rns/regulatory-story.aspx?cid=773&newsid=857147
Following discussions with the Oil & Gas Authority, the Halifax Well has been suspended to allow for potential future operations to either deepen and/or undertake further testing of the well,
marine licence and a chemical permit now approved per O/G website as I post seawell vessel over Halifax
light well intervention is what I am thinking, which is a cheaper option than putting a rig over the well head
If its further testing of the well then positive results could be significant
The above post by LASERDISC on ADVFN sounds interesting.
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Hope we get an update on the seawell operations. There are some different opinions.
Ron
Nice one winalot. Enjoyed reading that.Cheered me up.
Passed it on to some friends.Might go viral.
Ron
SpruceGoose2
Hi,
Thanks for your comments.
The part revisit was due to Rc’s post and AK’s reply to that.
AK was not agreeing with some of what I had written.
I did repeat some of the content but did add other points to expand on my take regarding the water issue as I saw it.
I like your phrase dspp- driven. Clever but highly speculative stuff he posts and I would think not suitable for a Hur BB. His comments involving Dr.Trice’s integrity were a disgrace Have resolved to restrict my visits to the TLF BB.
Thanks for these links will have a read especially the Hur CMD Presentation.
Cheers,
Pecten 11
I did believe AK was using a discreet sealed system for the point he was making. i.e. no outside additional energy applied.
Ron
adoubleuk & RC_2020
RC_2020 : Posted: Finally someone starting to get it. How about a simpler explanation; water is close to the well and is being drawn in with oil? Now how could water be close to the well? It’s a thinker....
adoubleuk: post Mon 16:15
Hi,
RC_2020 only said I was starting to get it. That leaves it pretty open.
Not sure what he means in the rest of his post by his simpler explanation.
I think he means how could aquifer water be close to the well
Pretty much what I was saying.
I do consider myself to be a something of a layman in the oil business but have learned quite a bit from posters like your self.
[1] I do believe that as oil is extracted from the reservoir that a similar volume of base water will be drawn into the fracture system. The volume of oil and the volume of base water will be the same. The area of fractures in the granite well receiving oil will be tiny compared to the area of the oil water contact. The vertical movement of the base water upwards into the fracture system will also be tiny. Dr.Trice has mentioned that the pressure reading in the reservoir was second only to one in Saudi Arabia. He also mentioned that this pressure reading had not altered much after oil production. This is why I made the comments that the wells must be in a highly fractured area with great connectivity from base water up to the horizontal well.
[2] Re your item on car braking systems.
Have to say that I would have thought the amount energy exerted by the driver would be the same amount of energy exerted on the brakes [neglecting small friction loses].Where would the extra energy come from?
[3] Re your sound transmission through air and movement of air molecules.
My take on that situation is what you are doing is creating a sound pressure wave which will travel to the other side of the field and be heard by the person there.
Whistle a tune without moving and you will create a number of pressure waves which will be heard as a tune at the end of the field.
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There are a number of smart posters on the LSE and I am sure they will read and have their own ideas on these points.
I do enjoy reading your posts that are of interest to me and appreciate you sharing the knowledge and experience you have built up over the years .
Glad I am just a simple lad.
Has saved me getting all concerned about base water [aquifer[ getting into the oil wells and up into the storage vessel.
These high natural flow rates in Lancaster where the oil or oil/water [depending on the well] is being lifted into the storage vessel by the reservoir pressure are very impressive. To achieve this lift from the horizontal well up into the storage ship against equipment resistance and the static vertical lift [vertical distance from well to ship.] the wells must be in an area of highly fractured granite. In other words this part of Lancaster is highly fractured with great connectivity from base water up to the horizontal well.
Why would the heavy base water be drawn up into the well when there is all that light oil surrounding it?
Letting my imagination run wild I could think of circumstances such as a closed vertical fracture in the granite from base water to well or a granite pipe with a core of fractures running from base water to well allowing aquifer water into the well.
No doubt some posters in other BBs the will bring up possibilities on these lines.
Apart from my simplistic approach I have confidence in Dr.Trice’s ability and integrity. He is also in the best position to assess what is going on subsurface and have the test readings of water etc. for analysis.
All as I see this
I am holding + adding
Ron
Hur would not know the amount of oil in GWA.
Only time will tell that.
This year should give them a better idea on Lincoln
There have been many comments on this BB regarding the Lemon Fool posts on trapped water, Hur hiding the water, Hur selling oil/water to BP, Hur basically pulling a fast one on Spirit Energy on the Greater Warwick farm in deal.
I am invested in Hur because I have confidence in their ability in the fractured basement oil plays and as a company they have a great deal of operational and commercial integrity. I am happy to rely and believe on their version of facts and events.
The technical points on these Lemon Fool posts have been well commented on by experienced posters on this site.
What made me angry are the doubts cast on Hur’s integrity regarding [1] hiding produced trapped water [2] pulling a fast one Spirit Energy in the GWA farm in deal.
The produced ‘hidden’ water from Lancaster has been dealt with by comments and later events.
GWA
I believe the potential of the GWA oil fields has been overlooked by most investors, reporters and the like. Spirit Energy made enthusiastic comments about the GWA field and their part in it. I am happy to take these at face value. A controlling interest in Spirit Energy is up for sale and anyone interested will take a hard look at the assets and potential for themselves.
What is not to like about the oil flows from the Lincoln Crestal drill results?
Maximum stable flow rate of 9,800 stb/d on ESPs[electric submersible pump]
Confirmed to contain light, 43° API oil
The well flowed at an average rate of 4,682 stb/d under natural conditions
No formation water produced in these oil flows.
•Well suspended as a future producer
Dr.Trice called this a huge resource.
One or more appraisal wells to be drilled on Lincoln in 2020
These wells could help towards turning resources into reserves.
WW
Warwick West is work in progress and we should get the results of the analysis of the 43° API oil and granite/fracture samples in the coming months. The natural flow of oil says something about the fracture system.
There looks to be a lot of potential in the GWA oil fields especially Lincoln which could be realised to some extent in 2020.
I can see why Spirit Energy made positive remarks regarding their part in the GWA farm in deal and the remarks in Lemon Fool were another mistaken effort on casting doubt on Hur’s integrity.
All as I see these events.
Ron
Energy Voice
Hurricane Energy’s exploration adventure offshore UK is the most exciting of them all, in my view.
Just had a chance to have a read of the Energy Voice article. ‘Exploration headwinds force Hurricane to alter course’ by Jeremy Cresswell 06/01/2020
This is based on an interview with Dr. Trice regarding the Hurricane Energy Rona Ridge oil prospects.
Very impressed with the article, concise, well balanced, informative, a good grasp of the subject and focused on the facts
When you think of the way the Warwick West well situation and the RNS was misunderstood by many it’s a pity this piece was not issued shortly after the RNS
Good piece of P.R. from HUR and a good amount of information for shareholders.
Hope there will be more of this quality in the future.
Would have liked to have got more information on what Dr. Trice meant in the RNS when he said ‘We are pleased to have made another discovery with the Warwick West well.
Dr. Trice got his oil, rock samples etc. We wait on the results of his research in due time.
I am not going to mention that misunderstood oil flow rate but thought it good to have a natural oil flow. Tells you something about the fracture system.
Time will tell how good the Warwick reservoir turns out to be.
Every time I hear the Warwick Deep well mentioned I wonder what an inclined well would have found.
There will be plenty of strategic decisions and revisions to be made in the coming months.
I look forward reading the various ideas on these in the BB.
All as I see the events.
Ron
WARWICK WEST
Thought I would show these excerpts from Energy Voice.
Energy Voice 03/12/2019
[1]Hurricane chief executive Robert Trice said he was pleased with the outcome at Warwick West, which was drilled with the Transocean Leader semi-submersible rig.
He added: “The impact that this well will have on how the company views the GWA accumulation and its associated volumetrics will require further technical analysis.
[2]Spirit would take over as licence operator at the development stage.
A spokeswoman for Spirit said that intention had not changed and that the company still planned to “move towards” becoming operator.
Carla Riddell, senior vice president for Spirit’s west of Shetland assets, said: “The results of the campaign are encouraging and the on-going technical evaluation will be critical to our understanding of the GWA.
“We look forward to continuing our work with Hurricane – building on activity from this year, and enhancing our own capability over the next 12 months as we move towards becoming operator.
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The results from the horizontal well of 1,300 bopd under natural flow, 43AP oil with less than 0.5 %water with no results given for pumped flow. The pumped oil flow rate was not given because they could not get a constant flow as the well was still being cleaned.
These natural flow rates look to have been taken before the well had been fully cleaned up i.e. still cleaning. No mention if all the constraints to flow such as pumps, chokes, equipment etc, had been lifted. The clock was ticking and the $s adding up.
Good to see the natural oil flow it says something about the fracture system.
This was an assessment / exploration well and flow rates are not always the main objective in these. Some have virtually none.
What is surprising is the number of analysts, reporters etc. who jumped on the 1300 bopd without any other opinions or observations.
Energy Voice gave the result as it was and reported an interview with Spirit Energy.
Malcy also gave a fair summery of the situation.
Dr.Trice did say he was pleased with the outcome at Warwick West which is a big positive for me. How that translates into size, production etc. of the oil field we will just have to wait and see.
Hopefully we will get an assessment and more details at the Capital Markets Day March next year.
All as my take on the events.
Ron
MCB55
Thanks for that information which I think confirms my point.
Ron
Joe Soap
Hi,
Sorry to take so long to reply.
Missed your post, found it today on a catch up session and then the LSE web site crashed.
See adoubleuk entered the discussion. Hope that helped.
The 9+ months given by the OGA for Lincoln Crestal to be activated was given by a poster and I used that to make a point. I do not know the regulations that OGA sets down. I would think they would be pretty flexible to suit each situation.
My take on Warwick West was that it would be a few years before the oil found a home.
Would the OGA have allowed the well to remain unplugged for that length of time? Safety issues I would think.
In any event I believe Hur and Spirit Energy would be co-operating in the well even with Hur as the operator. I don’t see a problem with a well being drilled to assess the reservoir and then p&a in these circumstance. Maybe necessary for the overall GWA strategy
It is a pity that for some reason a pumped oil flow was not recorded and the natural flow was unsatisfactory in my opinion. There was some problem which we do not know the details of.
The flow rate could have been low, as you believe, who knows? Writers keep using the natural flow figure as a normal well test result not doing the share price much good.
Dr. Trice said ‘We are pleased to have made another discovery with the Warwick Well.
Spirit Energy said around the same time that they were looking forward to taking over as Operator of the GWA.
I take both of these statements as good positives.
Ron
JoeSoap
Hi,
We can all have our own take on events and that is fine.
My take was that it could never have been a producer and Hur/Spirit would know that.
The time allowed for a well to be suspended can be reasonably short before it has to be plugged and abandoned if not activated.
Looks like it was only just over 9 months for Lincoln Crestal.
The Warwick West I don’t believe could have been a producer in the time required and this would be known before they drilled the well. There was nowhere to put the oil in the time allowed.
Ron