Member Info for WetWater

Thanks guys - amazing research work.

Newtofo: Regarding the DIFT I interpret Origins/Falcon’s response to immediately proceed to the horizontal to mean they are happy with what they saw and no further testing required. Maybe the ‘excessive over pressure’ gave them what they wanted they see and addresses Closes’ concern about the Lower Kyalla pressure and low matrix permeability. Jus a guess on my part.

Darnit: Sorry but that statement is about all I know.

Newtofo: I’m on the road but you might start with the Ages(?) reports. I recall it being a surprise finding - probably gets back to the mica content in the quartz you mentioned though that’s way beyond my abilities to say - just recall that the Kyalla cores were encouraging. Don’t know about the DFIT - seems Nano was more knowledgeable with that history. Falcon/Origin have said lots of data points so you can bet they understand the Kyalla much better than they have let on.

Hydrogen: The Beetaloo is estimated to contain 496 TCFs of gas in place - I believe that is just the Velkerri formation. It has been reported that equates to 85Tcf of estimated recoverable gas. That 85Tcf is based on the 16% recovery factor. If the stage3 wells target the Velkerri then with the prior pierce points and seismic one can assume each additional well will prove up another 6 - 7 TCFs of gas with hopes that a declaration of commerciality can be made. If those stage 3 wells go to the Kyalla then one can assume the Velkerri will remain contingent resources for the immediate future. Falcon will have run out of carry at that point so those resources will carry a lower evaluation unless Falcon elects to participate in their percentage of drilling if Origin elects to do so as they will own 70% at that point and control the project.

Newtofo: On the road but here is what I think hydrogen is referring to - It was reported in one of the geologic reports that in lab analysis the Kyalla appeared to be very frackable contrary to prior beliefs. Also, I believe Origin has performed a DFIT (what Santos is performing) on some of the prior Kyalla pierce points. Origin/Falcon have a lot of data points on the Kyalla - to the point that I was the told a year or so ago that there was a 90% chance of the Kyalla making a well. Nano took exception to that statement and it sounds high to me also but it was from a very knowledgeable source. Even with an 80%-90% chance of success that leaves 10%-20% chance of failure so it’s not a given. While on the subject that same source gave the Velkerri wet about a 40% chance of success - probably because of the lack of data/pierce points on where this Velkerri shallows out and wet gas accumulate. Back to the core samples on the Kyalla - I don’t know that you will see much more than what Falcon released. What wasn’t reported in the Falcon release is there appears to be excessive overpressure downhole in the Kyalla vertical - thus the excitement by Origin/Falcon. GLA

What I don't empathise with is all the yellow triangular 'Don't Frack' signs, matching shirts and the line of talking points being spoon fed to them. These people are being played by LTG and other anti fracking groups. The development of this industry can provide the necessary education, health services, welfare and most of all jobs these groups need to survive and thrive. Many of the native landowner groups understand and appreciate the opportunities availed to them but it's the environmentalist that manage to keep promoting the scare tactics flowing - not for the native landowners benefit but rather for their own. These native groups are being played by those who don't have the native landowners best interest at heart IMO.

Schlemiel: This is a new article but based on the same news we have seen. Its encouraging to see the NT News picking up on these positive comments - seems many time they want to put a negative spin on drilling/fracking.

If Origin is excited and Falcon is excited that makes me excited!!

Shalamar9: Thanks for the article on the Marcellus. As you mention prices vary widely which likely stems from the various development stage of the acreage. The Beetaloo's challenge will be to get a fair price across such a huge expanse of acreage - much of which is technically unproven. Now the concession looks to be offering multiple pay zones which will makes any evaluation even more challenging. I suspect the appraisal report will employ multiple reservoir engineers/company for a formal work up of assets in place. I look forward to seeing the value these professionals put on the Beetaloo and more specifically Falcon's 30% interest.

Gonoles: Likely an oil - not gas play. Still from what I recall the Davy report said parts of the Barnett (Marcellus?) acreage was going for up to $25,000/acre. What will Falcon get for its 30% of the Betaloo with what is shaping up to be multiple pay zones - I'll tell you in about 18 months!!

Schlemiel: Origin, in its investor presentation 11/20, made it very clear that the Velkerri well would be drilled the second quarter of calendar year 2020. I believe this was on page 51 of the pdf file.

Schlemiel: I think exciting results may be putting it a little mildly. Origin is extremely pleased with what they saw in the Kyalla vertical hole. I don't know what the accelerated drilling plans means as all they can do is continue drilling the horizontal which was the original plan. The down hole pressures and contents exceeded expectations - that's very positive but we still have to see how the Kyalla formation responds to full blown fracking - if the formation fractures as the lab analysis indicate then we are in good shape. Hopefully we continue to get positive news as this well progresses. The Kyalla is an unknown - fracking procedures vary and can play an important part in the ultimate success of a field. I doubt Origin will get it perfectly right the first time so whatever the flow test results they can likely be improved going forward.

Newtofo: Thanks - that is a much better and well written response than what I offered. I for one would be following you out the door if management changed - Falcon is on a great track with an endgame in sight. POQ is just the guy we need at this stage of the game.

Poods - You and I are still on different pages. I don't watch the share price of this stock - about the only stock price I see is what's on the top of this page just because it's there. My focus is on the final sale. If it makes financial sense to hang around another year to participate in drilling another 2 - 3 wells to prove up resources or reserves then our CEO said he might be receptive to that. Otherwise, Falcon doesn't have the capital or company structure to participate in a drilling/development program of the Beetaloo field. This type of development is for the big boys and Falcon or some other small company doesn't have the ability to play that game. Furthermore, we are years away from any production income on this concession.

As far as SA IMO we are also years away from Falcon even repeating what they have done in Australia. Chevron (our exploration partner) and other majors have no appetite for the current corrupt government - SA is dead in the water until the country elects legitimate, dependable leaders - the current political environment is a disaster. POQ was the chair of a committee that represented Shell, Chevron, etc. to the government in an attempt to lower the government demands on ORI - the committee couldn't get anywhere and that was with the less corrupt and more legitimate government than that of today. The committee thought the elections would improve the situation but in fact things have gotten much worse - from what I understand no one trust the current regime to the point of spending huge amounts of money just to see assets appropriated by the government. From what I understand China and Russia have more leverage in SA than other countries. I'm really talking outside my area of knowledge regarding SA - I just don't see anything happening anytime soon but then that's just my opinion.

BO: Dr. Close and others have stated that Falcon's acreage sits in the fairway (sweetspot) of the Beetaloo. On top of that it is hopeful that this acreage sits on top of a very prolific Kyalla formation which is exclusive to our JV. Reading between the lines Falcon/Origin appear to be excited about what they have seen in the vertical well - we have yet to drill and frac the horizontal but it looks like we are off to a good start. This next 12 - 18 months could get very interesting.

Schlemiel: Another point that needs to be clarified in the Underwood video. He makes the statement that Origin will be drilling a second horizontal well about Christmas - Origin, in their recent investor presentation, indicated that the second well (Velkerri) is expected to be drilled in the Apri - Jun window of 2020.

Newtofo: I had the same observations after watching the video and before seeing your post. Agree that the NT may take a look/see before issuing anymore horizontal fracing permits. Then we have the water study requirements you mention. The well Empire mentions drilling appears to be a vertical well to take core samples from the Velkerri Shale. I also agree if Santos is fracking it is likely a vertical frac which does not carry the regulatory burden of the horizontals. It is good to see the\is development taking place across the Beetaloo Basin. This additional activity in the Beetaloo can only help the exposure of Falcon's Beetaloo project.

Schlemiel: Origin/Falcon have a lot of data points on the Kyalla. The vertical hole confirms to them that the Kyalla shale at that location contains the same expected rock characteristics, depth and thickness. If the shale is as expected and they know the depth and thickness then they can calculate from what depth to whip out a horizontal hole so as to land the horizontal leg in the middle of the Kyalla shale. We are getting into Nano's or a PEs territory but there will be an analysis done on the core/cuttings that can tell them TOC, rock structure, and many other things which I don't understand. These wells are so expensive you want to give yourself the best chance possible. Once the horizontal is drilled then the frac job automatically follows. As they drill through the Kyalla they will likely get some gas shows but still at the end of the day even if the gas/liquids (TOC) is in place the success is dependent on how well the Kyalla can be fractured - From previous wells and cores Origin has been encouraged at how well the Kyalla samples appeared to frac - but the real tell is when the frac trucks hit the location and start working their magic with up to 9000 pounds per square inch of pressure.

VegasGal: Maybe just some grey highlights! Per the Origin report EPT results should be completed Q4 FY2020 (Apr - Jun 2020). We can be optimistic and look for them in April.

'Preparing to drill horizontal' in the Origin report leads one to believe the vertical has been completed. Unless POQ lets us down we should see some type of news release soon - that is my interpretation of the 4-5 news release stages.

I don't see any reason for Falcon/Origin keeping the Kyalla a tight hole - Falcon's acreage contains 100% of the Kyalla Shale in the Beetaloo. Come on POQ - help us out a little here!!

Rock: Just FOLGF being FOLGF - Don't let it rock your world!

BorntoBoogie: Agree with much of your post. Falcon and Origin(?) paid a renewal fee for the option extension to purchase that remaining 1% royalty. At the time of the extension their actions meant they wanted to see results of additional Beetaloo drilling prior to purchasing that royalty at an increased premium - sorry but I don't recall the specifics on time/money. Thanks for pointing out to some on this board that Philip inherited a mess. One of the first things Philip was told was that the project would be hard to sell with all the royalty burden it carried. Philip has done a great job of repurchasing that royalty and putting the pieces back together.

Glad you are making it down to the Origin investor meeting. I look forward to hearing back what you learn. Origin and Falcon are very hopeful of the Kyalla but what I don't think you will hear is much on this well. Like some other posters on this board I don't believe the vertical has yet been completed. If in fact the vertical has drilled then I will be disappointed in POQ for his news release promises. Even if an unannounced horizontal has been drilled the well will not have been fracked which must occur prior to any indication of shale production results. Then again, even after fracing, the well must unload the fracing fluid and clean itself up prior to any meaningful flow rates. This well was spudded about October 8th - its was estimated that the drilling would take 30 - 45 days and the fracing another 30 - 45 days then to be followed by an extended flow test of 50+ days (guessing). I agree with BO that it might be late January or even February before the EPT results are known. It is also important that everyone keep their expectations in check, for as Newtofo cautioned the Kyalla has never been fracked so it is still a bit of an unknown.

Santos results could be very telling for our Velkerri B discovery and yes, their Velkerri shale runs much deeper than the Amungee 1NW - 1H well - Falcon's shallower Velkerri formation would prove much more economical with similar flow rates.

Northern: Typically Falcon will give a short update in the corporate presentation at the AGM. IMO there will not be much/any progress in SA. We all thought the last elections would improve the investment environment when in fact things went from bad to worse. With the current corruption and instability of the SA government companies are not going to get in bed with these people. The Karoo is a great asset and the country could benefit from its development but personally I don’t see anything happening short to mid term. All just my opinion.