still looks like the man gets played more than the ball.... No...

still looks like the man gets played more than the ball....

No analysis. Just a few "observations". See if these stimulate discussion on the "fact of the matter".

1. 3-well drilling program Phase 2 complete .... just leaves phase 3 (the flow testing) to complete.

While a few here are happy to play blind man's bluff, AKK has in the past provided and has again reminded its current and future  shareholders of their expectations for this drilling program. In case you missed it, the last paragraph of the announcement

"For further information on Austin’ current drilling program, including potential economics of productive Pierre wells, please see Austin’s August Investor Presentation that was released to the ASX on August 11, 2016. A copy of the presentation can be found at www.austinexploration.com/investors/presentations/ "
So that presentation that I have so often referenced here remains in play as the most up to date company representation of "The Plan". In that presentation is the P10/P50/P90 pre-drill expectation by which the company would benchmark the results. So the question is simply will those wells present themselves are better/par/worse than the P50 expectation.

2. Drilling Cost of US$500K/well

This has seen a whole lot of discussion. What have you been told?

"Austin’s team, who drilled this well internally and managed all on-site operations, drilled the well on budget for approximately USD$500,000. The Company has been successful in drilling three wells for approx. USD$1.5million. ... The Company is confident that as more wells are drilled that drilling costs can be further reduced. "

and

"These were the first Pierre wells in Colorado drilled and operated internally by Austin’s Team. The Company is proud of this achievement with similar wells drilled in adjacent and close proximity in the past costing more than USD$1million per well. "

Interesting commentary. The previous Pierre wells that AKK completed were done by a contract driller (which I believe also then led to creation of JV Pierre Energy Partners). Granted costs were higher then and have come down significantly but the deflation present in this cycle is temporary .... evidenced by COP who added a couple of rigs to their EFS ops and specifically said on their earnings call that attempts to lock in current low rates for a 2 year contract were resisted. Either pay more or accept short term rig rate.

I would be very interested to hear the ways in which AKK would reduce D&C costs for Pierre wells.


3. Is $500K per well low cost anyway?

Depends on the measurement.

$500K to get 50MmBO of EUR ... OR ... $4M to get 600MmBO of EUR, which is the better well?

$500K to drill 4,000ft Pierre well (no fracking) ... OR ... $65 per lateral foot (no fracking) which is cheaper




Will results be in 1 package or well by well???

Good luck