RE: Why go back13 May 2018 20:55
Jester, Mole explained why the other day, you must have missed it.....
spent more time on Thursday with other shareholders and Levan and left Zaza in the main to talk to other people. But to attempt to address SB question of why did they shorten the scope of T45 and Dino?
First note the production profile per Page 9 of the presentation. The deeper you go the higher the recovery factor. 20% at zone 9, 33.3% at zone 14 and 50% at Zone 15. Looking at oil in place you have a similar story with 19%, 32% and 48%. So we have targeted 80% of the play.
Second zone 13 was identified as prospective when drilling was already well underway at Dino and complete at T45. They will have contracted for the work as described and ordered materials in advance. So it was not in the original work program. Zone 9 for me has always been ambivalent. They do not need to prove zone 9 flows It is well proven across multiple wells and campaigns. Based on the above zone 13 could well add another 10 to 20 % of oil in place with a recovery factor probably between the 20 and 30%.
Third and most important we know the decision to frac smaller sections with more power and more propant was a deliberate operational choice. The propant they used 71.5 mt in stage 1 and 70.5mt in stage 2. Plan was 46mt in total. They have used 142mt in one well!
A few other facts:
45 was not a sidetrack so the higher section in zone 9 is at least in part the old casing. They did a casing patch as opposed to cement squeeze at the join.
I'm doubtful that zone 9 would contribute a full modelled % at T45 and Dino as they have been exploited (Dino for 9 years!).
Production would be within limits of trucking capacity of 5,000 barrels a day (even if the trucks will be busy with the increased production it is not a limit).
So the question in hand the main importance of the well is to:
1. Generate revenue.
2. Prove the modelling of zone 14 and 15.
I would guess that doing the 3 zones together as a first experiment was ultimately a higher risk not work taking for the reward with 80% of the pay is in the two zones fracked successfully. So for me the big decision was whether to stop what they were doing and try and incorporate zone 13 not why did zone 9 not get done at t45 and Dino. As zone 13 was new and unknown in its properties I think concentrating on zone 14 and 15 was probably the correct call based on all the information we have.
I don't think its a matter of would it be cheaper to do all 3 at once (of course it would be) but I think its a bit more nuanced in balancing risk and reward and also possibly quite simply having used all the delivered materials. I think people have not appreciated just yet what they have done at T45 in changing the approach to perforation and propant.
Sign In
Follow the stocks
