Proposed Directors of Tirupati Graphite explain why they have requisitioned an GM. Watch the video here.
RichGreenWood: "Origin could be keeping this tight for several reason, including competitive reasons and wanting to be consistent with their practice of when and what they disclose in press releases." This well's initial 24 hr flow test is not a material event for Origin (the 90 day is material IMO)- Origin could choose to ignore it. On the other hand this test could be considered a material event for Falcon - if so I believe Falcon would legally be required to release this news to its stockholders. Philip did promise us these these initial test results. But then he also promised us so many news releases at every stage of the Kyalla that we would tire of receiving them - Hmmmm! - How did that promise work out. I really don't understand why this information would not be released by now. Possibly Origin has decided not to release an 'official' 24 hour test (why I don't know) and just proceed monitoring the 24 hour production flows leading to the 90 day test? If that's the case is would be nice if POQ would at least tell us what is taking place - Frustrating!
RGW - " There are lots of U.S. E&P companies that do not announce well results, period. Many smaller companies tend to want to press release everything." True but there is lots of industry interest in this well. There is no need to keep this well tight as there are no competitor wells offsetting our Kyalla acreage nor is Origin actively trying to acquire surrounding acreage. Puzzling Guys! Origin will release the 90 day flow test results in their own good time - Falcon is not in charge of this show.
Longknife: I guess to get more to my point - I don't know why we are seeing what is in my perception a delay in the initial 24 hour flow test. POQ promised us a 24 hour initial flow test - IMO that should happen within a couple of weeks after fracking but it hasn't yet been released so for whatever reason I am wrong. As Newtofo/OrsonM mentioned Origin is looking to release the 90 day flow test sometime after the first of the year.
As to my equipment comment I am almost certain that would not be the case - Origin has seen this coming for months and the this type of test is standard procedure. I should not have even mentioned equipment as that's highly unlikely - I am almost positive the 24 hour test will be run shortly if not already.
As to the timing on the test the well needs to clean itself up and unload the frack fluid. Once that happens the 24 hour test will be run - that gives Origin a base line and potential of the well. After that test is completed then the well will be flowed for a 90 day period (nothing magical about 90 days as the Amungee test was 57 days). Origin will monitor the pressure/volume/fluids over this period to gauge how sustainable these metrics hold up. How stable and level these measurements are over the extended test gives the engineers an idea of the Kyalla's longer term potential.
OTD2000: I take the 'first results' comment to be referring to the 90 day official extended flow test - which is the important one. The 'end' of October would be for the initial 24 hour flow test that reflects potential but not the wells sustainable flow/pressure going forward. Typically a fracked well takes a bit to clean itself up - I'm thinking a week or two would be sufficient but that is a guess on my part. If the initial 24 hour flow-test is not scheduled till the end of the year that would mean Origin is waiting for equipment to be put in place but I doubt Origin would be caught off guard on not having things in place for a simple test. I has told the 24 hour test would be performed at the end of October - If Origin keeps to its delayed news releases we may not hear for another week or so.
We need Empire or Tamboran to give Origin some news release lessons - the silence and lack of communication is not what POQ promised us before the Kyalla was drilled. IMO there is no reason to keep this well, out in the middle of nowhere, so tight - inquiring minds want to know :^) With all that said Origin has its reasons for what they do - we will know in due time.
jfhealy: What do you see as conflicting in the FOG update? I'm hearing that we should get an initial flow report by the end of this month. If Falcon reported on Oct. 2nd that early stage gas flow rates are expected in the coming weeks then that would that not fit what we have been told? Not questioning what you said - just trying to clarify what your conflict/concern might be.
Darnit: Fun conversation guys while we wait for the initial test results. As to your comment "the price of FOG would be more dramatically lifted than Origin's share price" that, in fact, would be the case if a stock purchase was done with the current Origin stock. With a new issue Falcon holders simply get 22.5% (plus the adjustments for unspent carry, setting up new company, etc.) of the new company and any successful wells would accrue to all stock in the new company. In my simple mind this removes the hurdles associated with how to value Falcon's portion - it would treat Origin and Falcon interest the same - fair in my book. To repeat, it also would make a much more attractive situation for Origin to 'buy out ' Falcon than trying to acquire our interest for cash. IMO Origin is not going to want Falcon to sell their undivided interest to a third party - it would really complicate things going forward when it comes to developing acreage - another reason IMO that Origin would try to make this work to Falcon's advantage.
All just my pondering - Thanks for indulging me!
Shalamar: "However, I do not believe this could happen before the final 2 or 3 wells (depending ) are completed as to sell sooner could seriously undervalue our shares / share swap."
I think you are missing the whole point of what I am suggesting - if a new Origin E&P company were established and Origin/Falcon's interest in the Beetaloo was spun off into it then it wouldn't make any difference when the final wells of the carry were drilled (other than making an adjustment in shares for Origin's unspent carry). The stock value at the time of the initial transaction would be whatever value the market assigned to the existing assets (drilled and undrilled). As the final wells are drilled then the market would value that production/proven acreage into the stock price of the new company. IMO, Origin needs to set up a new E&P company for this to work properly for the stockholders of Origin and Falcon - there needs to be a clean slate which in my opinion would benefit both Origin and Falcon.
The more I think about this the better I like the idea of a stock acquisition for Falcon - there is no need for expensive appraisal reports and haggling over how to assign values to unproven acreage (i.e Amungee Velkerri B). It lets those of us willing to hang around the huge upside potential - for those wanting to exit can do so at their own timing. I will be watching for actions by Origin/Falcon that fit into this scenario.
Stebol: This is all just a guess on my part. Origin has basically sold off all of its E&P other than the Beetaloo. Origin's base business is energy production and utility sales (electricity). If Origin was to spin off the Beetaloo assets into a new entity then I'm thinking Falcon would be assigned an approximate 22.5% of the new entity's stock. Any new development debt would follow this new entity. Likewise any revenue (block sales/farmouts) would benefit the new stock. I'm sure this is an oversimplification of the structure but IMO it cleans up the undivided interest mess and would also clean up Origin books by splitting out the Oil & Gas E&P from their utility business. I would love to participate in something like this if it were available. You wouldn't have the overhang/burden of Origin's current business model - it would be strictly an E&P play in a World Class Discovery on steroids.
If the Beetaloo was spun intact into a new company then there would be no evaluation issues for current Falcon holders - one would just get their prorated share of 22.5% based on their current stock ownership of Falcon. In my mind it would not make any difference as to when a deal of this nature was done - any exceptional flow test such as the Kyalla #117 or the upcoming stage 3 wells would translate into an increase in value to both Origin's current 77.5% and Falcon's 22.5%. There would have to be some type of adjustment for unspent carry due Falcon but that would be adjusted into the final percentage allocation of the new company.
Newtofo: Certainly not a tax person but I'm thinking there would be no taxable gains on an exchange of this type. Taxes would be computed on any realized gain/loss over the initial evaluation of the new Origin stock when it was sold. Like I said I'm sure it's not that simple but I would think it could follow that general model.
This is all just conjecture on my part but it does seem to be a nice solution for Origin/Falcon shareholders.
Speaking of pondering the possibilities I want to revisit Falcon's 'undivided interest' in the Beetaloo. I have always viewed this ownership as a messy situation for both Falcon and Origin. The most logical way out of this situation would be for Origin to buy out Falcon's interest - putting the concession back together and then moving development forward.
Now ponder this - What if Origin was to make a stock offer for Falcon's 22.5%. Origin could then potentially spinout the Beetaloo into a new E&P company or less desirably keep it under the existing energy company. They could then sell off or farm out blocks of acreage to fund the Beetaloo's continued appraisal/development. The beauty of this is those wanting out of Falcon could sell their newly acquired Origin stock and continue to hold interest in the drilling/development of this World Class field. I'm not a tax-expert but taxes might possibly be deferred? I have always heard that Falcon could be a $10 stock if only it could continue in the development of these assets. A stock buyout by Origin would give those willing to hang around longer a great way to realize the huge potential of this field.
Origin/Falcon's concession is so big it will take multiple large companies many years to develop the acreage. As Origin proves up acreage it could sell off blocks limiting debt burden - allowing its stock value to appreciate at a quicker pace.
A setup like this would allow Origin to put the Beetaloo interest back together and fund large portions of their own E&P while letting Falcon shareholder's participate more in the upside of this tremendous asset - a WIN WIN in my book. Above my paygrade but I would assume Origin would offer Falcon a sweeter deal in a stock offer than a cash offer. The Permian Basin has just seen two big stock acquisitions this month ( Pioneer acquired Parker & Parsley $4.5B; Conoco acquired Concho $9.5B). Maybe Origin acquires Falcon for $?B :^)
Just some crazy thoughts while trying to practice patience while awaiting the Kyalla news.
Thoughts??
Thanks OrsonM for helping to quell the hysteria trying to raise its head. I'm hearing this is a nice well - how nice - we will just have to wait and see. IMO we are within a week of an NR but as you mentioned no-one has a firm handle on that timeline. The Kyalla is out in the middle of friggin no-where - things do take longer. Patience all! Origin/Falcon will let us know when the initial flow rates are established - in the meantime ponder the possibilities!
NLC backs Origin Energy in Beetaloo Basin fracking stoush with traditional owners
The Northern Land Council has backed Origin Energy’s position in a stoush with traditional owners over its plan to frack the Beetaloo Basin.
THE Northern Land Council has backed Origin Energy in a stoush with traditional owners over its plan to frack the Beetaloo Basin, saying consultations were “appropriate and correct”.
Alawa Native Title holder Naomi Wilfred accused Origin of failing to listen to TOs who “would’ve said no to fracking” at the company’s annual general meeting this week.
But chairman Gordon Cairns said Ms Wilfred’s country was to the north of the land over which it held permits and said Origin had worked with the TOs nominated by the NLC who were supportive of its plans.
“We understand some TOs may oppose fracking but it’s also important to understand we are not exploring for gas or fracking on their lands or in their communities,” he said.
“The process we follow to maintain the ongoing support of Native Title holders involves sharing work programs in advance, undertaking scared site clearance surveys and participating in on-country meetings.
“To date, we have always received support for our planned activities, including hydraulic fracture stimulation.”
After the NT News requested clarification of the point, NLC chief executive Mario Scrymgour said the organisation was “confident” appropriate procedures were followed.
“The Northern Land Council is confident that appropriate and correct consultations were undertaken with the relevant traditional owners and native title holders of land regarding the activities of Origin Energy,” she said.
“The NLC has and always will comply with the statutory functions and duties imposed by the Aboriginal Land Rights Act and the Native Title Act, particularly in relation to consultations with traditional owners and native title holders.
“The NLC’s actions are always informed by and will always follow the instructions provided to it by the traditional owners and native title holders.”
Mr Cairns said Origin’s permit areas covered some 18,500km/sq spanning 10 pastoral leases over which Native Title had been established, with exploration work under way on four of those leases.
“The NLC has facilitated ongoing engagement with those groups who can speak for the areas where our exploration wells are located,” he said.
“For example, for our two current well site locations we have engaged with several family groups throughout 2018 and 2019.
“During 2020 we continued this engagement completing sacred site clearance surveys, visits to site and annual on-country meetings are scheduled for November.”
It guy: The court’s statement doesn’t make this clear IMO. I took it to mean someone acquired those shares. Maybe Origin? They are the.only ones that have the in-side track on this. Just. My conjecture :^) May be totally off base.
Fracking Beetaloo ‘no risk to water table, coronavirus safe’, Origin chairman tells AGM
Origin Energy has defended its plans to frack the Beetaloo Basin from accusations it could pollute remote communities’ water supplies and put them at risk from coronavirus.
Jason Walls, NT News
ORIGIN Energy has defended its plans to frack the Beetaloo Basin from accusations it could pollute remote communities’ water supplies and put them at risk from coronavirus.
Speaking at the company’s AGM on Tuesday, chairman Gordon Cairns said Origin was “assiduous about water management” and there was “no evidence that fracking actually in any way pollutes the water table”.
In taking questions from shareholders, Mr Cairns also rejected concerns it had recommenced bringing FIFO workers into the NT after having earlier suspended the practice due to the coronavirus pandemic.
“We obviously take our responsibilities very seriously here and we paused our activity to keep communities safe,” he said.
“We have resumed in line with government restrictions being eased and we will continue to take the health and safety of employees and our communities as the number one priority.”
Naomi Wilfred, a Native Title holder of Alawa land she said was impacted by Origin’s operations, said traditional owners were angry their opposition to the project had been ignored.
“Alawa people care a lot about our land because of our songlines, our sites and our future — our land is so important to us, especially water,” she said.
“Origin has not tried to seek consent for fracking from the traditional owners, and we will never give it.”
But Mr Cairns said the company only recognised the TOs nominated by the Northern Land Council, who were supportive of their operations.
“It was a privilege to host those Native Title holders on site last month during fracking operations, they were able to inspect the equipment and talk with our specialists about how the process is safely undertaken," he said.
“They actually want us to come because they can see the economic benefits that will accrue to them as a result of us being on the land.
“We also have committed to them that their land and water will be protected.”
cont.......
Ultimately, the Moomba CCS Project has the potential to store up to 20 million tonnes of carbon dioxide per annum, the company says.
"We will need an approved methodology for CCS to be in place with the Clean Energy Regulator before we take a final investment decision on our Moomba CCS Project because carbon credits are essential to make it stack up economically with the cost of abatement still at around A$30 per tonne," Mr Gallagher said.
"Our aim is to drive these costs lower with scale and experience, but the first step is to generate carbon credits to enable initial development.
"Last year, Moomba celebrated its 50th birthday as a provider of reliable, affordable energy to the eastern seaboard. We are growing production in the Cooper Basin again, and that, combined with the Moomba CCS Project, has the potential to make Moomba a vital supplier of clean energy for Australia for another 50 years, supporting thousands of skilled, secure, well-paying jobs and decarbonising energy at its source.
"The initial project would support around 230 new South Australian jobs through construction.
"Our Moomba CCS Project is one of the most globally competitive projects - it will be the second largest in the world and one of the lowest cost project at our current estimate of around A$30 per tonne."
Mr Gallagher said this successful test along with recent Federal government announcements paves the way for large-scale CCS to drive down Australia's carbon emissions. Experts, including the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change have identified CCS as a critical technology to achieve the world's climate goals.
Energy companies say gas testing in Beetaloo is 'better than expected'
Chris McLennanChris McLennan
Energy companies continue to be excited over the initial results from the testing of gas exploration wells in the Beetaloo.
In a report to investors today, Santos said production testing at the Tanumbirini-1 vertical well east of Daly Waters resumed last month and results "significantly exceeded expectations".
The production test recorded an initial peak gas flow rate of 10 mmscf/d (million cubic feet per day) and an average rate of 1.5 mmscf/d during the first nine days of testing.
"The results at Tanumbirini-1 provide critical data to inform the next phase of appraisal, which is expected to include two horizontal wells with multi-stage stimulation commencing in 2021," the company said.
"The recent test results provide further confidence there is potential to achieve economic flow rates from multi-stage horizontal wells."
Origin Energy is expected to soon release details of its production tests after it resumed activity at its Kyalla well site near Daly Waters in the Beetaloo after a six month stand down.
The Kyalla well, drilled almost two kilometres deep late last year, has been fracked for the production testing.
Initial results from this are expected by the end of the year, with full results in the first quarter of 2021.
Origin has reported they found a 900 metre gas-rich layer of shale during the vertical drilling.
Junior explorer Empire Energy told the stock exchange earlier in the month it had discovered what is believes it is a big reservoir of liquids rich gas at its Carpentaria-1 well site about 85km south-west of Borroloola.
The gas was found shallower than expected and across a layer of shale almost a kilometre thick.
The explorers like Empire, Origin and Santos are looking for gas in two shale layers, the more prospective Kyalla and the Velkerri which Empire has intersected.
Empire said it would now prepare the well for fracking tests and a flow testing program early next year.
Australia's Energy Minister Angus Taylor visited the Beetaloo to inspect the Empire Energy well last week to build on the Federal Government's gas-fired recovery plan.
The government has made the Beetaloo a priority for development.
Meanwhile, Santos says it has successfully injected approximately 100 tonnes of carbon dioxide deep underground into depleted gas reservoirs as part of the final field trial for the Moomba Carbon Capture and Storage Project in South Australia.
Santos managing director and chief executive officer Kevin Gallagher said the successful injection occurred earlier this month in the Strzelecki field in the Cooper Basin and Santos would now finalise technical and commercial arrangements with the aim of having the 1.7 million tonne per annum project ready for Final Investment Decision by the end of the year.
cont...
Poods: I know the name but don’t personally know the gentleman. He’s associated with the oil industry but that’s the extent of what I know of him. I want to think I met him through a George W. event but wouldn’t swear to that.
Interesting thought on the stacked play. I don’t think Origin would complete out of the same hole - if you drill a successful first Kyalla well and then screw up the hole in a Velkerri play your screwed! It’s done at times but I know the big players here in the Permian just walk the rig over. In a field development the well might be drilled down to deepest play and only attempt to complete the secondary zone after the primary zone depletes. I’m hearing people are very pleased with with the Kyalla test. If that holds up the rig would likely remain in place - do they drill another Kyalla test or move to drill two stage3 wells on the same pad? If they initially skip the Velkerri wet #76 well do they drill that at some point after they are through with the Kyalla 2 stage 3 wells - would be nice but we will just have to see how things develop. So many opportunities - so few wells to prove them out.
I’m thinking the initial flow test will be completed within about a week. The Kyalla well has had sufficient time to clean itself up - Just my opinion. Here’s hoping for gang buster results!!
Newtofo: Maybe I wasn’t clear - Davy’s 40p was for the Amungee well including the area assigned in the 2C resources. This acreage covered 12.5% of the Beetaloo. If Origin were to step out and drill two additional Velkerri wells then it might be possible to prove up 2C resources on 37% of the Beetaloo’s Velkerri B which is said to cover 97% of the concession. Would Origin step out or drill immediate offsets in the current 2C area - don’t know. If they drill to prove commerciality in the current 12.5 , with success, they greatly de-risk the 6.6 TCF play.
Not every new well would add another 40p unless they prove up additional 12.5% blocks if that makes sense. At the end of the day Falcon,s biggest problem is they don’t have enough wells to prove up the the concession - whether that is the Velkerri, Kyalla, Hayfield, or really ideal all three.
There is not way each well would be worth 40p in a field development situation - not what I was trying to say.
Hopefully the future drilling will focus on the Kyalla but then we have the same discussion - do you prove up 2C on vast blocks or go for commerciality - that I really don’t know. Maybe by the end of the year the picture clears.
Hope this better clarifies what I was trying to say. On the road and on a friggin iPad so maybe not the best answer.
I believe the Davy evaluation will be extremely under-valued if we get the anticipated good news from the Kyalla 117. In Davy's evaluation they risked the Kyalla at 12% - if the Kyalla makes a nice well I believe that risk will be lifted to 60% or so. The Kyalla evaluation IMO should be on par in not more than the Amungee. If one amungee well is worth 40p to Davy what would a total of three Amungee wells be worth if stage3 were drilled - add to that a hopefully nice Santos well to the east helping prove up the acreage in between. If the Kyalla produces the same volume along with the condensate three (maybe 4?) Kyalla wells could be worth more than three Amungee wells. Of course if 3-4 good Kyalla wells are drilled the Kyalla would be declared a commercial discovery IMO resulting in a lot of the remaining risk will being removed. I don't recall Davy assigning any value ($200+/acre?) to anything outside of the already declared 2C Amungee well resources - that needs to be added in the equation as that acreage certainly contains lots of potential. I don't have time to go through my all my thoughts right now - packing for a trip - but I still see $2/share written all over this stock with a nice Kyalla well. I know some see more, some less. I'm not a reservoir engineer so take this for what it's worth - which is not much!
Here is the NT article behind the paywall - Not much to it IMO.
Federal plan for NT gas gathers pace as Angus Taylor flies to Beetaloo
THE Morrison Federal Government is following through on its pledge for the Territory’s Beetaloo Basin to have first priority in a gas lead recovery of the nation’s economy
GARY SHIPWAY, NT News
|October 15, 2020 10:30pm
Beetaloo chosen as first of five Federal Govt gas basin projects to lead Australia’s economic recovery
Exploration companies resume rich Beetaloo gas exploration program
THE federal government is following through on its pledge for the Territory’s Beetaloo Basin to have first priority in its $28.3m Strategic Basin Plans for a gas-led recovery of the nation’s economy.
Energy and Emissions Reduction Minister Angus Taylor has flown into Darwin and will visit Empire Energy’s test drilling program at its Carpentaria-1 site in the Beetaloo Basin tomorrow.
“The Beetaloo Basin is a world-class resource that has the potential to drive significant development in the Top End to create local jobs and help Australia remain a world leader in gas,” Minister Taylor said.
“The government’s Strategic Basin Plans will accelerate this development, driving investment and job creation in our regional and Indigenous communities as we recover from COVID-19.
“The Beetaloo Basin has the potential to supply more gas to Australian homes and manufacturers, helping to increase competition and drive down gas prices across the market. This will mean more Australian gas is working for all Australians.”
Beetaloo was chosen as the first location for the first Strategic Basin Plan to capitalise on industry momentum and to build on existing government initiatives in that region.
Minister Angus Taylor will visit Empire Energy’s test drilling program at its Carpentaria-1 site in the Beetaloo Basin. Picture: NCA NewsWire / Gary Ramage
This includes the $8.4m already committed by the government to accelerate the development of the Beetaloo Basin, including conducting additional environmental work and work to ensure the gas development will benefit the Aboriginal Peoples of the Barkley Region and the Northern Territory.
“Our Strategic Basin plan will drive more jobs in regional Australia and provide the cheap, reliable energy industry needs to grow manufacturing.”
While visiting the NT, Minister Taylor also held talks with Northern Territory Minister Renewables and Energy Minister Eva Lawler MLA, to discuss a joint federal and Territory energy and emissions reduction agreement.
The federal and NT governments signed an agreement in late 2018 to work together to develop the Territory’s gas industry.