The following is a summary of some very useful posts from LongJohnSilver over on LSE this afternoon in europe. Any thoughts/comments?
"Spent the weekend reviewing old data from when the company began exploring the Y zone and an independent evaluation of that data. It has become perfectly clear that the company's intention ( following the results of the evaluation ) was to target the Y zone as an OIL bearing zone and not a gas zone although there is associated gas with the oil. This now is backed up I believe by the initial information given out by the company during flow back on 77H I am aware that the PI's focus has been on the gas but I now believe that the focus should be on the oil. Well 19Z was drilled vertically to the Y zone in 2008 and a 6 metre section flowed on natural pressure unaided at 800bopd reducing to 120bopd. This is an indication of the potential of the Y zone. The company have always believed that with the advancement of fracture stimulation and horizontal drilling that production from the Y zone would be greatly enhanced using these techniques. Having reviewed the old data, subsequent presentations and the results from 76H with regard to pressures and hydrocarbon flow together with what we now know. I am in no doubt that 77H will be a high impact well and I am expecting oil to be flowing well in excess of a 1,000bopd. Another interesting point is that following Ron Miller's appointment and review of the independent evaluation and the data from 76H that the forward drilling program was altered from 3 vertical wells and 2 horizontal wells to the following program of 3 horizontal wells to test X and Y zones and a deep vertical well to the deep Z zone with future side track. ' The contingent drilling programme is predicated upon the successful flow-back and production test results of Cambay-77H, the firm horizontal offset well. The vertical pilot contingent well and horizontal well at Location G is designed to test the fluid type distribution across the Contract Area, and will be targeting an area that has tested oil from the X and Y zones in the past. If successful, the well will be side-tracked to a 1200 metre horizontal and stimulated by hydro-fracturing. ( Note a 1200m horizontal section. I think this may add some interest to OILEX going forward once flow results are known from 77H ) The deep vertical contingent pilot well at Location A is designed to test the fluid type distribution to the east of the Cambay-76H location. This is down-dip and proximal to a vintage well which previously intersected the X, Y and Z zones and which are interpreted to be hydrocarbon-bearing on the wireline logs. An additional two contingent production wells at Locations D2 and D3 may be drilled from the Cambay-76H drilling pad, which will be extended to accommodate this activity. These wells will be designed with extended horizontals based on the success of Cambay-77H. ' So in my opinion the results of 77H will be the catalyst that will propel the SP well beyond anything that most people are expecting here and that should be in the not too distant future. So what I am saying that the area that we are now targeting is in the oil window on the western high flank with sections from 200m to 500m thick which are thicker than most N. American shales with good porosity and permeability and high over pressures caused by high pressure zones beneath and it is full of oil. I repeat full of bloody good high value OIL. I now don't care when Ron releases flow results as they are in my opinion going to be mind blowing. I can wait. The contingent drilling plan is in the RNS dated 10/4/2013 The info I have gleaned on the old data and evaluation are from numerous releases by the company from 2008 - 2011 along with presentations, quarterlies etc. all archived on ASX announcements and the Netherland Sewell CPR dated 11 10 2011. I can assure you there are tens and tens of them. But for me it was worthwhile as it has reassured me of the massive OIL potential of the western flank."
OEX Price at posting:
14.5¢ Sentiment: Hold Disclosure: Held
