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Plan to deliver. Deliver the plan.
This is not about sticking your neck out. Simply deliver the plan you tell your shareholders.
It’s not rocket science. It’s about the quality of your people and their ability to deliver.
No ones getting bashed up here. Do I know better, it’s very likely after years in Mongolia.
That’s exactly my point. If you cannot understand the Chinese and how they work, the risks, quality, HSE performance, and plug all that into a schedule, with risk contingency, your inability to understand where you will fail, will likely be passed onto your shareholders in the form of failure.
I have worked in oil and gas as well as mining all over the world.
Matad have to simply do better. If I was in Mikes position a number of the current team would be out the door. You are paid to deliver and perform in Mongolia. If you do not have the right experience, bring people in that do.
We are working in Mongolia and if you have the right team and people, no these things do not happen.
Hiding behind this fact I am sorry to tell you is unacceptable.
This is a difficult country, but if your people cannot cut it, you pay the A-team that can.
This is not exactly a multi billion dollar project with huge interfaces.
Cannot agree with your logic I am afraid.
I cannot agree with you.
I know Matad are struggling with bureaucracy in Mongolia. Mike is an experienced operator, but to fully understand Mongolia and how it all works will take a minimum of three years. There are at least two others on this board that live in UB and will recognise how difficult it is here at times to get things done.
When a business or a project is conceived, the schedule to deliver that is the Project Directors or CEOs primary and daily focus. Four wells was what the company told its shareholders it would achieve this year. The operating overhead to achieve that would I hope be factored into the companies cash flow and budget forecasts for 2018. Because they have not achieved that the business has therefore been inefficient, carried additional cost, and been unproductive. Therefore its very likely the business will again approach the market prior to next years drilling season as it has four wells to drill in 2019, as we now know Block XX will not happen 2018.
Schedule slippage goes hand in hand with capital cost escalation. This years failures simply put add pressure and cost exposure next year, which may impact the share price 2019, as a potential Feb 19 placing is highly likely. More work next year because of the failures this year, likely mean 2019 cost forecast simply needs more money as we have four wells to drill instead of potentially two.
I know you will state we are fully funded for six wells, but that's only if the cash is spent in line with the execution strategy and this and next years staffing histograms. Matad would of carried likely a number this year to deliver four wells. We now have four wells to drill in 2019 instead of two, so 100% more work to deliver next year.
Failure to deliver however if news next week or the week after is positive, changes the picture.
I would however expect contingency to be included in this years schedule and execution planning for an oil strike. The fact Block XX has now been abandoned this year, is either down to the company being unable to deliver against what they have stated to their shareholders, or they have changed direction due to making a find. If the latter does not apply, they need to be completely transparent as to why they failed. Simply put we deserve to understand why.
I know you may view this as negative, but I am probably the only person on this board to permit a major project in Mongolia, so know how to take engineering from China, North and South America, chop and translate data, get this through MRPAM, and into execution. I can also understand very clearly the challenges Matad face. Some may believe they do, but you won't.
Mike and Matad are on a difficult learning curve. If SL comes good, great. At the moment still glass half full, but if there are issues at WH, and "community relations" are on site, that's a massive red flag for me, which I hope are concluded shortly.
Still positive, but need to see an improvement in deli
Two things go hand in hand in Mongolia.
As the golf season finishes, so shortly after does the drilling season.
Its early September and most nights now are close to freezing. Only time will tell if an early winter puts an end to Matads aspirations to make a start on Block XX.
I see we are focused predominately on drill speeds, and expectation around actual depth.
What I have not seen anyone factor in, in terms of contingency, are potentially the following.
> Issues with locals / herders.
> Soum Governors
> Adjacent Soum Governors.
> Water issues.
> Government intervention.
> Equipment reliability.
There may be several other impact factors which if you solely rely on numbers attached to drill rates can be massively inaccurate. Regardless of the number you can mathematically equate, unless you add local contingency you may well be a week or more off actual, which in turn makes drill rates and expected depth an inadequate method of measurement.
Just a thought !!
I think we are suppose to get around 265 Blue Sky days in Mongolia.
I definately believe your thinking falls into the Blue Sky thinking bucket my friend.
Shareholders want a professional management group who are capable of developing the plan, then delivering the plan. That’s how they create shareholder value.
Reactive project execution change adds cost, time and no value. I therefore am of the opinion the plan Matad have, they should stick too.
You do take some s—t buddy.
But you knew it was likely coming as soon as a sniff of success was perhaps disclosed. Could be a false dawn but it appears if this goes much higher today you are likely to be taking a good slapping until the markets close.
However I still maintain I enjoy reading your posts pal. They do add a bit of balance. Or should that be imbalance!!!
Off for a sneaky G&T as the weekend is here !!
Sounds like you have been burning the midnight oil !!
I hope some is potentially Matads.
I agree with the balance of your posts. In an ideal world which we do not live in, everything is perfect. The fact is however aspects of projects can and do change.
Some factors attached to success in Mongolia can at times test ones resolve. What makes sense in a developed market, can at times in an emerging economy such as Mongolia be far more testing. I hear Matad are being tested, but know having been in the same situation they will work through the issues. This can take time, which may add a factor of slippage to dates and schedule. It’s therefore difficult to update shareholders or release an RNS, as what may apply today, may not apply tomorrow.
I am sure over a few vodkas the issues will be resolved and all will be plain sailing again very shortly.
If all comes good there is still no reason why the drilling program for this year cannot be delivered. I believe the company will have done all that is required of them.
My only concern is certain process's in Mongolia hindering Matad, which then puts a spanner in the works.
Fingers crossed block XX news will be positive, and equally SL comes good for all shortly.
I hope you are right in terms of the numbers.
However November can average -12 daily and that can creep to under -18 at night. Depending on the winter Mongolia has this year, we may get lucky and see a longer period where productivity can be assumed.
What is for sure, unless equipment is certified and permits are signed off, you will be continually adjusting your schedule, which if weather does play its part can cost the company additional funds, through having to demobilize early. If PM are still not in a happy place with MRPAM, it may be a consideration they have to make to protect the business in terms of wasted cash.
Hopefully they come back positively with good news shortly. However if they don't and they consider the risks to great due to the weather window available to them this year, I would back that decision in terms of ultimately de-risking the business,
However Fundy is a smart chap and will post what he believes. Others here are equally as smart and just filter out what they believe does not apply.
I agree the facts and knowledge speak volumes. Equally some of the less factual stuff at times is rather amusing to read as well.
Try to remain a little bit more balanced and apply less emotion. It adds no value.
Stick to the facts and the process and accept all that post here add something to the mix. Equally all are rooting for a positive outcome so we can attend Manro’s £1 party.
Have a nice weekend.
The MRPAM are professional people, so will treat Matad no different to any other project or company.
Once they are happy, the process will flow again.
No big deal, just takes a bit of time on occasions.
Bucc, I do enjoy your no nonsense approach to certain posters !!
OT, not OJ !
What people have to realize as Oilfated raised is the guys are operating in the middle of a desert. This years weather has been harsh in terms of rainfall. If they lose a couple of days on schedule due to inclement weather, I am sure they will make it up.
All sorts of odd things can crop up in the Gobi including unannounced visits from Soum governors, inquisitive herders, ajoining Soum governors looking in, all of which need carefully managing or a political situation arises which may impact schedule !!
Not just about putting a drill bit in the ground and letting the technical guys deliver. Lots of other moving parts Matad will have to manage. So let the guys crack on, wait patiently, and I am sure they will deliver news in line with what they have told their shareholders.
Or, your welcome to the 600 click horse ride due south west !!!
We could always ask Rio for a seat down to OT. Jump in the company chopper and head due west. We could be there for tea !!!
I would agree to the horse ride but I am not sure my back could do the 600 clicks.
News will come when the company has something to say. Until then in Matad we must continue to trust !!