The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Sorry I realise I posted part way through yours!
Firstly, thanks for the work, and especially pulling out the 42km figure, I knew I had read that and was struggling to find it again at the weekend, your picture on reddit let me pull it out. For those reading not on reddit, there is also graphic on internal page 13 of the presentation that shows MOU 1 with an area of 42.17Km2.
Looking at the source material again (the annual report) I agree the 31.7km is described as "new" therefore it is additional area. However, it is also referring to MOU-4 not MOU1, it says "a new MOU-4 prospect covering 31.7km". The reference to 92% is not a reference to the area per se, but is stated as being a 92% increase in estimated recoverable gas. As TGB 1-4 are within MOU-1 I dont think this can be referring to an increase in their area.
I also come back to the reference of 100Km2 in the annual report, and I can only read that as referring to the total area of the targets combined, therefore not an increase which has been concluded from the drill. See for example the Corporate presentation page 8 referring to 100km2 with multiple traps. It looks to me like this overall area was the revised prospects from the Covid period re-analysis.
Morning,
If 31.7 was "a" 92% increase, not "the amount by which it has increased" then the correct sum should be 31.7/1.92 = 16.51 sq km. To reverse that, increase that by 92% = original + 92% extra = original * 1.92. 16.51*1.92 = 31.7
That's my take on the situation, and it makes sense tying in with the reviews that PRD confirmed were undertaken during the Covid hiatus. To speculate further, it may be that it had key strata at a useful distance from the other targets to give information as to what might be further along each path.
Of course only PG and team know for sure, but it fits with what they have said and published.
Ah cross posting there between GRH and I.
Thanks for that - the de-risking of that 100km area was my reading, apologies I had understood you'd suggested the 100km area was an increase in the target area, rather than an increase in confidence across a larger area.
In terms of the 2D surface area (assume all numbers are in sq km) we have the RNS 12 July which stated:
"MOU-1 established the pre-drill geological comparison with the Hoot and Guebbas gas-producing sequences of the Rharb Basin and most importantly de-risked the pathway required for dry gas from a thermogenic origin to charge the primary targets in a prospective area of over 100 km². MOU-1 therefore further enhanced the CPR prospective gas resources assigned to the proposed MOU-2 and MOU-4 drilling targets whilst adding some additional potential shallow targets that had previously not been considered."
The question is whether that 100km was a new figure, or a reference to a pre-existing area. My reading of this is that it is referring to the area which includes MOU-1, MOU-2 and MOU-4, whilst the additional targets referred to is talking about depths, not additional area.
The 100km figure can be seen in the corporate presentation July 2020 page 8 which reads "• Prospective area high-graded for drilling covers 100 km² with multiple traps – some larger than entire Rharb Basin cumulative historical production"
Reference to the area of MOU-4 can bee seen in the annual report at page 4at 31.7km, I can't recall where the 37-42 figure I had in mind before came from and a quick look around isn't showing me.
Hi GRH, I am very supportive of what you do and agree with much of what you say. I do have a query in relation to the 100 sq km being an increase - the company literature has long referred to 100sq km containing multiple traps and MOU-1 was referred to as the 40 odd sq km area within which we chose a tap point. I don't think I understand why you consider the area has been increased from the latter to the former rather than just referring the aforementioned whole area of targets. Are you able to shed light on that?
Thanks
TT
I think the answer to this is indicated in the annual report - final para of page 4 over to page 5. It confirms that MOU-1 aimed to inform both mou-2 and mou-4. It implies but does not state it would assist in considering the varied mou-3. I.e. it was the point where a single drill would be most informative over and above the spot drilled itself. As such it had less riding on the results of finding commercial gas there as it still gives benefit to the surrounding targets.
It's the spot where if you hit the glass and see where the cracks spread you know where hitting again will break through.
Re reading the 2020 presentation is quite interesting. I note that they compare the MOU-1 prospects to anchois 1 which proved 126 BCF (page 11). I also note on page 13 that the 1972 logs found 0.21% gas which was comparable to the 0.23% find at anchois 1.
Compare this to the various finds of formation gas at MOU 1 of between 1.67 and 3.8% does that not suggest we found rather a lot more than previous indications? Background gas between 0.60 and 1.70 also compares favourably if that was what was being referred to at those pages.
Does anyone have any reasons I am wrong to compare these?
To be neutral on this, although the words success and pleased have been used by company announcement, the inclusion of data without commentary as to what the data means has resulted in ambiguous company announcements. There has been some detailed analysis by longterm holders on here which indicates it should be read positively. There has also been a lot of voices asserting that any positivity would have been shouted from the rooftops, ergo the analysis must be wrong. So far the market has leaned towards the latter camp.
My view is that the positivity does outweigh the negativity or the uncertainty, but it does take a bit of work to understand that. Try reading this thread as someone has helpfully collated some of the key analysis of the last weeks.
https://www.reddit.com/r/PredatorOilandGasPRD/comments/oindbu/open_analysis_and_review_of_prd_data_shout_free/
Has it increased? Wasn't the 37-42km the area of just MOU-4 and the 100km was always the prospective area covering the multiple targets? See for example page 8 of the 2020 corporate presentation - 100km with multiple traps.
The annual report confirmed it was the sweet spot to drill as it would inform us as to the prospects of MOU-2, 3 and 4. It was the centre of a spider's web and it was not certain where the next drill target would be.
For those who have not followed the whole debate lately as Clueless posts near constant negativity (are we about to see another buying surge this afternoon?), the documentation published shows MOU-1 had multiple goals. It was "supposed" to find evidence of gas at the outskirts of a large gas region to increase the intelligence and probability of a large gas kitchen and it did this. It was "hoped" that the gas levels it would find may be enough in themselves to tap and monetize to assist later work. The jury is out as to whether this hope is achieved as the wire logs are assessed, but from independent case studies, the figures published do not rule this out.
Neither PRD, nor Morocco nor even MOU-1 were a binary play with a single fail/success criteria.
Hi James,
Frustration and feeling let down are perfectly natural responses, shared by many here but they are also emotional ones. My view is that one of the key successes of the negative shouters on this board has been to cement the idea that success or failure are binary positions. They aren't, success is a sliding scale.
Would Paul have like to see more gas that could be exploited? Probably for the short term though it may have made him doubt where the core is and spend more time fishing around, albeit with financial security.
There have been some very well reasoned cases for elements of success from this drill sufficient that calling it a failure does not seem accurate. There is positive information that is useful to the company and which indicates a real promise for the future. So did it go to plan? Partly yes, partly no but with more gained than missed. To that end the results are net positive in my view.
Paul's communication choices have been a subject of much gnashing of teeth for all the years I've been invested. That has been true during good and bad times, so it's hardly surprising and I do not believe indicates all the dire conclusions spouted on here. For myself, I don't feel that assigning the damage limitation motive to the silence properly reflects the past actions.