Thought I'd share this postive change of view.

I was looking over my notes back in July and a letter I sent previously to Dr. Hession regarding the press release on the wells where they announced the Wahoo suspension as well as the status of Bobcat and Raptor.

At that time there was no mention of problems in Raptor with the Orubadi shale and the well was "progressing slightly slower than first estimated".  This was actually excellent news at the time but MH bungled the delivery, starting off with the bad news about Wahoo.  Then he failed to present Raptor in the positive light it was in at the time.  Although it is a very late arrival, Raptor is now finally at the doorstep of the target zone and is preparing to run 7" casing, as we have just been told.  They never mentioned sidetracking Raptor back in the July update, whereas at the time Bobcat had already been sidetracked TWICE.  The 7" casing that Raptor is about to run is an OK size casing if they get it to TD..  If they stick it high, they may have a 5" liner contingency to enable them to drill to TD if they have a very short distance to go.  Or they could drill with 5" casing to TD out of the 7", if the connections are designed for that.  That's been done elsewhere.  But drilling through 5" casing while possible, may not be very feasible given these formations.  It just all depends how shallow they stick the 7" if that ugly scenario visits us.  In any case for Raptor, that is about the worst likely thing to happen in the near term other than finding a dry hole.

But again, connecting the dots of the two reports on Raptor, I have not heard any talk of problems with the Orubadi shale in this well.  So the fact they have not mentioned that is a big positive or they just selectively omitted it.  But clearly they ran into some kind of problems because that was quite a while back.  In any case I'm a little more positive on Raptor now than yesterday after looking back, mainly because of the absense of Orubadi problems.  Note that they did NOT mention testing any surprise shallower interval.  So I think we have to assume that did not happen.

Bobcat on the other hand - has nothing positive.  It stinks.  With two sidetracks already way back in early July and NOW they are still fighting, it sounds terrible.  I'm wondering if they restarted very shallow (essentially a new well).  My base expectation is they will have to give up at some point.  This seems like pulling a rabbit out of hat, that you just pulled out of another rabbits mouth.  Or they might do another Wahoo type suspension.

Lastly with Wahoo parked, IMO they should be in no hurry to get back to it unless the idle rig is burning a hole in their pocket.  Clearly they bit off way more than they can chew.  They should get at least the first Antelope well finished and done right, before starting any new wells or restaring Wahoo.  Then with as much concentration and attention as they can muster, they can consider restarting Wahoo or any other exploration well.

They need to digest all of these mistakes and figure out what actually works and WHO inside or outside of the company can drill a well right.  Then they can resume.  At least if I were running the show, that's what I'd be doing based on the poor performance to date.  Yes it is a no-brainer that it is poor performance when you provide 60, 90 and 90 day estimates and exceed all 3 wells by well over 100% with no end date yet in sight.  Use or flush.

I know nothing about  drilling. It would seem that  they had to expect the  Orubadi shale. In the excavating business  clay is  more difficult than other soils. However wet clay  is extremely more difficult. Is it possible that something is making the clay wet? Would the prescence of oil in the shale make it more difficult?  It has been stated  on this bulletin board that  the prescence of  oil in the shale  does  not prove oil in the pay zone.  Is oil  and shale together a common problem?

'Putncalls' pid='50287' dateline='<a href="tel:1412129 Wrote:OK OK Kaliboo: But with respect to Bobcat? What would keep a crew drilling a pieces of slate to nowhere in the rain amongst the creepie crawleis for three months?

I'm glad you brought that up, Puts.  I worked in the rural tropics for two years and the monsoon rains bring out a number of poisonous and disease causing genus/species.  Further, I'm guessing quite a few of our local workers would have taken leave to come together with their own communities to deal with the mess caused by the rains and subsequent persistent flooding.  It tends to be a cultural value – rooted in survival; for generations they've learned that they are "stronger together."

Even if that is the case, I don't know that that would account for all of the longer than expected drilling times.  Slow drilling to run down OSH's exclusive negotiations clock I can see.  Conservative caution I can see as well.  I can't connect enough dots to conceptualize why we would slow drill to arbitration, though.  Maybe Laurie Brown is riding a learning curve re our East Papuan Basin.  All of that notwithstanding, Kaliboo is right. These boys need to take stock (no pun intended – at least not originally )

For what my measly opinion is worth, when I first read Palm's report that IR says our legal counsel is having to figure out a way for the execs to purchase stock in order to fulfill their contractual agreement <-- which he also pointed out, I found that to be the first objective data point in support of our speculation that there could be farm-in type talks going on behind the scenes that are not wisely (or maybe?? legally??) disclosable to the public.  An interview article from not too long ago did confirm that there was more than one company a'knock knock knockin' on Hession's door.  Michael followed up that confirmation by saying something like, "but we need to find out what we've got first."  But all that remains as speculation.

So keep drilling baby, keep drilling.

'calvin grad' pid='50289' dateline='<a href="tel:1412131 Wrote:

I know nothing about  drilling. It would seem that  they had to expect the  Orubadi shale. In the excavating business  clay is  more difficult than other soils. However wet clay  is extremely more difficult. Is it possible that something is making the clay wet? Would the prescence of oil in the shale make it more difficult?  It has been stated  on this bulletin board that  the prescence of  oil in the shale  does  not prove oil in the pay zone.  Is oil  and shale together a common problem?

"Shale" is a loosely used label to refer to very tight nonproductive rock which may contain oil, water and/or gas.  Clays present in the rock, as well as unfavorable earth stresses, can make them difficult to drill.  Some clays actually ball up the drill bit making progress impossible.  Generally the longer the shale is exposed the more problematic they can be.  Problems are mitigated by using oil base muds and chemistry which minimizes swelling.  Also proper fluid density is essential.  I suspect they have gotten stuck many times and have sidetracked many times.

Kaliboo,

You do make a lot of sense. But if your right Raptor should wrap up the doubt and fairley soon?

'Putncalls' pid='50287' dateline='<a href="tel:1412129 Wrote:OK OK Kaliboo: But with respect to Bobcat? What would keep a crew drilling a pieces of slate to nowhere in the rain amongst the creepie crawleis for three months?

The drilling crew are the workers on the rig.  As long as the pay is good and the working conditions are tolerable, they will keep working.  On some of these locations, getting home means a chopper flight vs. a dangerous hike through the bush.  I'd take the flight.

'Putncalls' pid='50468' dateline='<a href="tel:1412490 Wrote:

Kaliboo,

You do make a lot of sense. But if your right Raptor should wrap up the doubt and fairley soon?

Well here's a rough estimate.  Since they made the announcement on Sept 30, let's say as of today they have drilled to the top of the zone (to make sure it's there) AND they have run 7"  casing.  Next steps on average each take about a week.

1.  Drill out of 7" casing and drill the entire payzone to TD.

2. Conduct logging, sampling and sidewall coring operations.

3. Rig up to conduct production test.

4. Conduct production testing and pressure build ups.

At this point they have all the data they are going to get.  Alternatively when they drill out of the casing, they could be set up to run core barrels to obtain whole core.  IF so, add another week prior to the production test.

5.  The rest of the operations are rigging down the test equipment and temporaritly abandoning the well, if it is a keeper.  But this is after they have all the data, so you don't count it as regards the date of the announcement.

6.  Post test analysis.  THey are doing the analysis in real time as they are getting the data.  They are taking the log, PVT , sample, and production test data and are updating their static and dynamic geologic and reservoir models.  All of this is aimed at generating new HC's originally in place and recovery efficiencies.  These two directly translate to the resource volume (gas and oil) which one day become reserves (we hope).

So as cautious as Hession is he may want to allow time for a lot of analysis  before saying anything OR he may just give a light report that says "We logged XX feet of gas bearing pay.  We conducted a production test at XXX MMCFPD  for XX hrs."  So I think Hession will want to know in crystal clear terms how good, how mediocre, or how poor the outcome is so that his message is appropriately hedged to ensure he does not stumble again.  So add another week for this.  Too much longer and info starts leaking out, if not right away.

So when could an announcement be?

IF it's a dry hole or all water or too small to bother, then we may know within 1-2 weeks.  At this juncture, more delay is most likely a good thing if in fact they got the 7" casing to TD.

IF they have hit a nice pay zone and done all the steps above, then an announcement could be in 5-6 weeks.  Say by mid November.  It would be nice to have a great result before Thanksgiving.  That would be just one more thing to be thankful for.