shareholdersunite.com

Thanks Pet, much appreciated. I was sort of thinking not finding a reef would be almost as bad as a dry hole, as from memory the low estimate from KR is something in the range of 1-2Tcf and although I realize there are numerous companies who would kill for that, it could be a bit disappointing for IOC, especially with the talks of reducing IOC’s stake in E/A to 10%. It would basically be a large Elk and not enough to feed a new LNG venture. Or perhaps we’ve just been too spoiled with these whoppers at Antelope.

But if you think it’s highly unlikely, that’s quite encouraging

Thanks Pet- that is like music to my ears coming from you. Forgive me for I know I have brought up this point before, but I still believe that this point is more significant than folks are giving it credit for and I would love to get your take on this Pet. Triceratops is significant because when we hit there it will prove that E/A wasn’t just a one hit wonder. This now speaks to the higher probability of ALL THE OTHER STRUCTURES ON THE ROLODEX being valuable, and containing more T’s of gas. The possibility of Arun like numbers then seems VERY probable. Gentlemen this is the stuff that dreams are made of… sleep well? Are you kidding? I am too damned excited to sleep well!

Pet, it is great having your analysis to rely on. Reading those older posts is as close to crystal ball technology that we can have. Even your comments on the road that IOC has been building are spot on. It’s interesting also your comments on FID as far as Mitsui and EWC. That really reminds of what the interplay is between the different partners and how valuable having Mitsui involved is. They have had to do an enormous amount of adapting the plans as things have changed. They really are the main cog in this project when you think about it.

Thanks again for all your analysis over the years. Having these posts to read and re-read is huge, and a lot easier when we don’t have the Yahoo noise to filter out.

Sageo- These are some of the same questions I would like to have the answer to so I can not be of much help.
On the PR where they announce the spudding of Triceratops-2 they said they would “3) in the event of success,
complete the well as a future production well.”
If they are planning to complete the well as a high volume producer they may start off with larger casing so they can end up with 7″ tubing for the producer. Just a guess of course.
At Antelope-2 they set 18 5/8″ surface pipe at 810 feet and intermediate 13 3/8″ at 3609 feet with 9 5/8″ at the top of the carbonate.

At Triceratops-1 they set 13 3/8″ at 381 feet and 9 5/8″ at 2,539 feet.
My guess is they will follow the casing sizes they used at Antelope. Since the well will be a bit more shallow I would expect to see the casing strings set a little more shallow than Antelope. The 13 3/8″ may be set somewhere near the sandstone they are expecting at +/-950 meters (3,117 feet).

If you are new to the board you must hear my disclaimer that I am not a geophysicist. So you must take anything I say about seismic pictures with a grain of salt. Regarding my comment about the little anticline below Triceratops-2 that is just something that looks interesting to my untrained eye. There has been some talk about finding the Pale/Subu sandstones below the Limestone section but we have never drilled deep enough to test that theory. The theory may only apply in areas East and Southeast of Antelope. Still it would be interesting to know what real geophysicist would say about the cross section http://www.interoil.com/presentation/2011-11-15_3Q11_Results_Presentation_Final.pdf slide 15.
I don’t think IOC plans to drill deep enough to test this section at Triceratops-2.
IOC had previously hoped to find oil in the Pale/Subu sandstones in the area North, East and Southeast of Antelope.

Welcome aboard Sageo!

I have been playing with IOC’s numbers again. On the PR http://www.interoil.com/newsrelease/2012-01-17_T2_Spud_Final.pdf they say they plan to drill Triceratops-2 through the “entire reservoir interval” to a total depth of 7579 feet (2310 meters).

On http://www.interoil.com/presentation/2011-11-15_3Q11_Results_Presentation_Final.pdf chart 15 they say they expect the top of the reservoir to be at 1320 meters (+/- 200)

Reservoir interval= 2310 – 1320 = 990 meters or 3248 feet.

The PR also says they expect to hit the top of the reservoir 1500 feet higher than the gas/water contact found at Bwata-1 so, based on that they are suggesting they expect a gross gas filled reservoir interval of 1500 feet. So less than half of the drilled reservoir interval is expected to be filled with gas.

Chart 15 is a cross section of the red line shown on the Phase 3 map on Chart14. So the reef falls off fairly quickly to the north. The highest part of the reservoir is along the fault to the south and west of Triceratops-2 is being drilled.

Sageo- Yes there is plenty of room for another location east of T-2. Southeast would be better. Look at the scale at the bottom of the map and you can get an idea how big the area shown is. With 62 square miles of closure there is plenty of room for locations. I tried to describe this map in my Masterpiece on Yazoo back of Nov. 16, 2011 http://messages.finance.yahoo.com/Business_%26_Finance/Investments/Stocks_%28A_to_Z%29/Stocks_I/threadview?bn=26290&tid=304359&mid=304359 If you look at the color code scale on the left side of the map on http://www.interoil.com/presentation/2011-11-15_3Q11_Results_Presentation_Final.pdf chart 14 with some effort you can see that the dark blue starts at -1500 meters sub sea. The map is drawn with 50 meter contour intervals and is based on sub sea depths. If you look at chart 15 you will see that Knowledge Reservoir believes the gas/water contact is at -1500 meters sub sea for the Most Likely Case. Back to the map on chart 14 you will see that the dark blue starts at the -1500 meter sub sea contour line. So, everything on the map above the dark blue should contain gas. T-2 is on the -850 meter contour line. If the map turns out to be correct we should have (1500-850) 650 meters (2133 feet) of gas column at T-2. Latest word from IOC is they expect 1500 feet. I think they are just hedging their bets a little in case it comes in lower than expected.

I can see a string of locations right down the -1000 meter sub sea contour line 1 km apart. According to this map, wells drilled on the -1000 meter sub sea contour line would be expected to have a gas column of 500 meter (1641 feet) .I would also put one on the high spot north northwest of T-2 which shows a -900 meter contour which would give it a 600 meter (1969 feet) gas column. There are many locations that could be drilled with a 1600 foot gas column or more.

After thinking that over we can consider what is west and northwest of this map where the green and yellow goes off the map. Looks like room for more locations to the west and northwest of what is shown on this map.

Now the good news. I just noticed that all of the above comments are based on the Phase 2 Map. Now compare the Phase 2 map with the Phase 3 map and you will see that there is much less dark blue and purple on the map. Remember the dark blue and purple would be below the gas/water contact so there is much more gas filled rock on the Phase 3 map.

Trace out the contour lines on the Phase 3 map and you will see that the location for T-2 is on the 750 meter contour line instead of the -850 meter contour line mentioned above for the Phase 2 Map. So according to the Phase 3 map we should expect to see a gas column of (1500-750) 750 meters or 2461 feet. And again plenty of room to drill on the -1000 meter sub sea contour line or higher.

And yes I do now see the location you apparently see which is a good 8.5 km East of the T-2 location. There appears to be another drillable reef on the east side of the Phase 3 map that was not on the Phase 2 map. That was a very good observation on your part Mr. Sageo.

Here is a hint for everyone looking at this Chart 14 map. Put your computer on 100% and the scale at the bottom works perfectly at 1 centimeter= 1 km. It is 10 km from T-2 to the western edge of the map (field continues West) and it is 8.5 km East to the new reef noticed by Sageo. This thing is looking “bigger and broader”.

Have a good evening!!!

pet & sageo nice eyes and great analysis as always pet.

Q: could any of the string of locations and/or high spots support multiple wells (perhaps in diff directions) from a single pad? Using lessons learned from E/A could they “fill the gaps” to obtain max Ts with minimum drill loc’s (with respect to GCA req’s)?

Mauimindmeld, you did it again. Projected your thoughts across the pond through the use of the foil cap you invented. It really does work; I thought you were kidding. In that case I think you CAN make a living selling those things on the web. So either we are both going to look really smart here or you are going to look dumb because I’ll blame my ideas on your foil beanie.

Sageo, I think that one of several battles being waged right now in the bidding for IOC. We have E/A with Mitsui pretty well entrenched and JAPEX very familiar with the formation and drilling results. Must feel pretty good about things with the “announcement” of the JKM consortium. And of course they most likely feel very good about T/B and what they’ve seen with the seismics. On most of their presentations IOC shows gathering lines that bring the wet gas to the area of EA (See slide 15 of the January 2012 IPAA Presentation). The lines from T/B show a couple of possible routes, but end up at the CSPs at E/A. So my guess is that JKM is also assuming they get T/B. Pet has also mentioned (I believe) that there could be the possibility of CSPs up at T/B depending on what’s found there.

As you mention XOM/OSH are scouring for more NG to feed their additional trains. OSH is finding some small pools, but nothing like E/A or T/B. So I would guess for assurance purposes they are very interested in the whole pie; whether it’s to feed their existing plant being built or to build in the Gulf to appease Kavo and take any excess to their plant. They also should be very interested in PL 236 as that gas could be fed most easily to their planned LNG plant.

Then we have Shell who would love to have it all also, but how they would develop the fields is anyone’s guess, and what they are willing to pay is even more of a guess.

I would think these are the three most interested groups, and it’s not to say that even if XOM does not get the whole things that they wouldn’t still want to buy some conditioned or wet gas. That could also be a way to keep Shell at bay; have JKM be the SD partner and work out a deal with XOM for feedstock. Would be hard for PNG to force Shell if a deal like this were to be proposed.

Maui,Pet-Aren’t we about ready to set some 13+ inch casing at T2? Also,OT,would Shell be interested in acquiring ppl just west of our ppl 237?

Sageo – pet is more knowledgeable than I am wrt drilling progress, but assessing it purely from a project scheduling perspective, I previously estimated in the PalmJumeirah post the time range to set 13-3/8″ casing at ~3,100′ was at the earliest Feb 15th and the latest March 15th http://shareholdersunite.com/forums/topic/ipaa-presentation/#post-7087

So I agree with pet that if they didn’t run into any problems, they should have already started the 9-5/8″ casing or if issues arose then could be at most a few more weeks.

Looking forward to the next drilling update so we can revise the target dates. Goes without saying there is high interest in be how far they will have come by the mid- to late-March. Could be anywhere from completing the 13-3/8″ casing from the most pessimistic all the way to hitting TD at the most optimistic. Still necessarily quite a large range, until we get more clarity re: progress.