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+--- Thread: IOC Drilling - - Probability of Success - - A Poll (/showthread.php?tid=5976)
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IOC Drilling - - Probability of Success - - A Poll - Stavros - 02-13-2014
IOC Drilling - - Probability of Success - - A Poll
We had recent posts/ debate regarding the Probability of Success (POS) for the upcoming three wells that are to be spud in the coming month:
+ Wahoo
+ Bobcat
+ Raptor
Indoreservoir emphatically stated that the odds are at best 20% for success based on historical drilling results worldwide.
Petrengr1 pegs the POS at 80-90% for all three wells based on the specific PNG situation.
I'd like to poll the troops because this is a key issue to my opinion. Success in these three new drilling locations would significantly impact the PPS since today it reflects ZERO additional gas beyond the E/A resource.
Please indicate your views on the POS . . . which range do you believe we fall into:
1. 0 - 20%
2. 20 - 40%
3. 40 - 60%
4. 60 - 80%
5. 80 - 100% - - - this is my belief
RE: IOC Drilling - - Probability of Success - - A Poll - Indoreservoir - 02-13-2014
Stavros,
Good idea - this should be fun.
But I want to clarify, I said that historic worldwide exploration well success rates for wells drilled on 2D seismic are in the 10-20% range. Further study suggests may its a bit higher in the US, worldwide I think not. I don't think I said that ours would definitely be at that level, but I expect these values are not far off (WoodMac says IOC is 29% in the presentation I posted, though I think that it's actually 14.5%.)
I certainly don't think our POS will be more than 30% - I'll say that unequivocally - my guess is 20%.
A few other points
1. I'm trying to get Admin to increase my attachment quota so I can post an article on exploration well risking from Peter Rose, who is one of the major G&G gurus on this issue. This would give all the chance to work with some facts and reality checks (his term) before putting in any numbers.
2. POS is calculated by a simple equation
prob source* prob migration * prob reservoir * prob trap = POS
now, I'd give source a 1, but the other 3 components less. Say 95% on migration, which is very high and is a SWAG on my part, but reservoir and trap go down considerably. You guys can play with this simple equation and see what even a 70% (very high) prob on trap and reservoir does to your POS (drops it below 50%). Hint - if there are surface seeps, you HAVE to worry about traps - where's the oil or gas coming from?
3. I'd encourage you all to strongly consider the dry holes (4, 5, 6 or 7, am not sure as they seem to be mysteriously unreported-on by IOC though maybe I'm not looking hard enough) that IOC drilled before (and after!) Elk 1. Try T1 and E2 (though some might dispute this) for the after wells.
4. The POS is geologic, as commercial POS adds another layer. Lets ignore that for now, I'd say.
5. However, one point on the POS commercial, look at the WoodMac report and the creaming curves (I love that description) and tell me what size any discoveries are going to be.
Rose's paper has a lot about the above and would give the membership some hard facts and techniques with which to make these POS estimates. Without any science, we're all SWAGing it (scientific wild-ass guess.)
Maybe do one poll before I post the Rose paper, and another afterward.
Before folks get all antsy and accuse me of being a secret short etc, I hold a lot of shares and am optimistic that E/A cert will be good. I agree with others that exploration is discounted, but i don't think it is completely discounted (look at Kris Energy's stock on the singapore exchange after two vietnam dry holes in Dec/Jan - OUCH!).
I also take comfort by Chandler's holdings - they are a lot more sophisticated than me, and they hold a bunch. I bet they might have some downside protection, but maybe not for all of their position.
GLTAL
RE: IOC Drilling - - Probability of Success - - A Poll - jft310 - 02-13-2014
Info you might review Hemi's post where he discusses the connectivity between all these structures ,
RE: IOC Drilling - - Probability of Success - - A Poll - sydbod - 02-14-2014
Just thought I would elaborate what the numbers mean.
The only outcomes can be 0 wells, 1 well, 2 wells, 3 wells successful ....... there are no partially successful wells.
What do the above percentages actually represent?
0% - 20% : should actually imply 0% - 33%, ... 0 wells up to 1 well successful in that range
20% - 40% : Only 1 well successful ...... there is no range possible
40% - 60% is impossible unless we extend it to actually mean 33% to 66% : implying 1 well up to 2 wells successful
60% - 80% : only 2 wells successful ...... there is no range ... has to be 2 wells successful
80% - 100% : can only be all wells successful
Am I correct in my assumptions?
RE: IOC Drilling - - Probability of Success - - A Poll - Movieguy - 02-16-2014
After 21 votes, using the midpoint of each range as the vote, we get the following results:
Mode = 90% Mean = 66% Median = 70%
I'd say a pretty optimistic bunch are we.
RE: IOC Drilling - - Probability of Success - - A Poll - Putncalls - 02-16-2014
I would like to point out some statistics. If success is considered any one of the three 'hits commercial C4" and we go with PET's estimate of 80 t0 90% The POF would be .15 * .15 * .15 or 0.3% which is a POS of 99.7% POS
If go with Indies number of 15% POS we get a POF of .85 * .85 * .85 or 61% which is a POS of 39%.
I would like to point out the IOC is drilling next to the Black Bass exploration well.
RE: IOC Drilling - - Probability of Success - - A Poll - Thylacine-2 - 02-16-2014
Anybody got a link to a map showing the Black Bass well? I'd like to see it's location in respect to the structure IOC is drilling near it.
RE: IOC Drilling - - Probability of Success - - A Poll - petrengr1 - 02-16-2014
Look at IOC's last presentation - Slide 15
RE: IOC Drilling - - Probability of Success - - A Poll - Putncalls - 02-16-2014
Thanks Pet!
http://www.interoil.com/iocfiles/documents/investorrelations/presentationanddocuments/2014/2014-01-13_Macquarie_Conference_FINAL.pdf
Black Bass was about 20 miles south of Wahoo-1 then and considered "dry"
Then there is T1 and Bwata which led to the T2 success. T1 was 4 miles NE of T2
I wish I could point out Bwata, moose-1 and moose-2?
RE: IOC Drilling - - Probability of Success - - A Poll - Putncalls - 02-16-2014
I would also like to point out that Triceratops and E/A are about 20 miles apart and both Bob Cat 1 and Raptor 1 are between those substantial discoveries. Black Bass looks to be about 20 miles South of Wahoo 1.
Of course we still need that Damn IPI buyout and Total contract!
http://www.interoil.com/iocfiles/documents/investorrelations/presentationanddocuments/2014/2014-01-13_Macquarie_Conference_FINAL.pdf