Today's AGM Presentation

[Getitrt2]

Well Palm.... The failure occurs when the rabbit does NOT come out of the hat. Hession seemed to be covering his but with "saftey".

Well Puts...........,

If you follow the thread you'll see that I was referring to a comment made by Getit who said that Kaliboo stated that Wahoo is a failure, when instead it was you who first stated it.  Kaliboo made a blanket statement that he agreed with your assessment, but it was you who first used the word "failure".  It was mostly a chance to rib Getit with his own "WRONG!" statement, but............. it............... obviously.......... went.... awry.   Sigh..............

Well, Palm, you are right in that Puts said "failure" FIRST, by four minutes, at which point kaliboo agreed.  Of course, I did not say that kaliboo said it first, but was just responding to his agreement and his other comments, some contradictory.  Ho Ho!

Isn't this fun?!  Yeah, if we're a bunch of masochists.  (Is that the right word?)  Oh well, I can't believe we're here again!  How much longer?!

[Thylacine-2]

It may be that Wahoo-1, the well currently being drilled, will be a "failure" and will be plugged and abandoned without providing adequate information to evaluate Wahoo the prospect. Or, on the other hand, they may work through the problems and sufficiently evaluate the prospect with Wahoo-1.

I didn't read anything in Kaliboo's statements that was anything other than an engineer in the business sharing his opinion, and modest frustration, about the outlook for the well, based on the statements by management.

It's always been the nature of the business that things go wrong in drilling wells. Kaliboo didn't make a big deal out of the possibility of losing Wahoo-1 and the rest of us shouldn't either. Wahoo the prospect is just as promising as it was before the well started having problems.

[Getitrt2]

It may be that Wahoo-1, the well currently being drilled, will be a "failure" and will be plugged and abandoned without providing adequate information to evaluate Wahoo the prospect. Or, on the other hand, they may work through the problems and sufficiently evaluate the prospect with Wahoo-1. I didn't read anything in Kaliboo's statements that was anything other than an engineer in the business sharing his opinion, and modest frustration, about the outlook for the well, based on the statements by management. It's always been the nature of the business that things go wrong in drilling wells. Kaliboo didn't make a big deal out of the possibility of losing Wahoo-1 and the rest of us shouldn't either. Wahoo the prospect is just as promising as it was before the well started having problems.

THY, Kaliboo was NOT just sharing "HIS OPINION".  He was speculating and contradicting himself from one extreme to the other, which I don't think is good for us or the stock.  "Losing Wahoo-1", temporarily or permanently, would not be a disastrous crisis; but, although IOC is in great financial condition now, $50 million is still significant, and months lost would never be recovered.  Otherwise, I agree.  I could be wrong, of course, but I think they'll overcome the problems.

[admin]

Nobody is 100% consistent all the time, Getit, I'm sure Kaliboo didn't mean any harm and was giving it his best shot.

[Getitrt2]

I never said, or even implied I don't think, that Kaliboo "meant any harm", I agree with that part.

[Kaliboo]

Question for drilling experts ? If we continue to have trouble with this location does it make sense to change location or change the angle of the drill bit  or to bring in Schlumberger type to help?

Given that Bobcat has 2 sidetracks (3 attempts) to get through the RUBadAss shale (my mental gimick to remember "Orubadi", and Wahoo (IMHO) has likely had more, you can be certain they have tried a number of things.  Moving a rig to another site is not uncommon if the given location has problems.  This might be done when the problems are very shallow.  With deeper problems you just sidetrack and drill directionally away from the problem.  This is a fairly shallow well, so sidetracking here isn't going to get you far away from the problem, it just gives you a 2nd, 3rd, 4th, etc., chance to fight the same problem again.  Moving the rig to another site e.g., a mile or two a way, might make a big difference.  They got Black Bass down a few years ago.  But building a new location has to be very costly.  In the end that may be what happens if they don't "pull the rabbit out of the hat."

Regarding an angle change, assuming the shale is a flat stratigraphic bed, the best way to drill it is with a vertical well perpendicular to it.  That's the shortest distance between two points - entering the shale and exiting the shale.  Also the borehole is most stable in this geometry.  If you approached the same shale with a deviated well, then you just made the path through the shale longer than it needs to be and you have chosen a less stable stress state.

A solution they should be considering is drilling with casing OR drilling with expandable casing.  In both cases the casing and the drill string are one.  You pass through the shale only once and then it is isolated.  Expandable casing is used all the time to isolate unstable zones while preserving hole size.  That's what I would be looknig at.  I also would be looking at the shale samples and optimize the mud chemistry.  But I'm sure they've done what they can there.  Being in PNG you don't have the arsenal of tools, fluids and options that would be available in the USA oil fields.

[jft310]

In the past Interoil has used Schlumberger, Forester and Weatherford to help with drilling. I am sure they would be willing to work for a sum again. They have bases in Singapore if I remember right? Or not thst far away lots of drilling in SE Asia.

[Kaliboo]

It may be that Wahoo-1, the well currently being drilled, will be a "failure" and will be plugged and abandoned without providing adequate information to evaluate Wahoo the prospect. Or, on the other hand, they may work through the problems and sufficiently evaluate the prospect with Wahoo-1. I didn't read anything in Kaliboo's statements that was anything other than an engineer in the business sharing his opinion, and modest frustration, about the outlook for the well, based on the statements by management. It's always been the nature of the business that things go wrong in drilling wells. Kaliboo didn't make a big deal out of the possibility of losing Wahoo-1 and the rest of us shouldn't either. Wahoo the prospect is just as promising as it was before the well started having problems.

THY, Kaliboo was NOT just sharing "HIS OPINION".  He was speculating and contradicting himself from one extreme to the other, which I don't think is good for us or the stock.  "Losing Wahoo-1", temporarily or permanently, would not be a disastrous crisis; but, although IOC is in great financial condition now, $50 million is still significant, and months lost would never be recovered.  Otherwise, I agree.  I could be wrong, of course, but I think they'll overcome the problems.

Here's another opinion again.  I think Thy hit the nail on the head in his summary of my comments you copied above.  I'm not aware I contradicted anything, however, some of my late postings yesterday were after I finally had a chance to read and re-read a few times what Hession said.  So the picture is much clearer now.  We're lucky to have Pet on this MB.  He knows much more about subsurface aspects regarding IOC and these targets.  Regarding drilling wells and well problems, I haven't read anything he says that I would have much if any disagreement with.

Here's another summary to leave no doubt..  Raptor and Bobcat look pretty darn good based on the very few and positive words MH shared.  Hession is escalating the concern on Wahoo dramatically; it's very clear that it may not succeed in this location.  MH's sharing the bad news on Wahoo first and over-talking about it while minimizing the comparitvely excellent news on Raptor and Bobcat is probably why the stock dipped.  Everyone fixated on the wordy negatives of Wahoo and didn't hear the rest.  That and the fact that they are way over the P50 without any updates earlier, helped to send the price down.  I think he could have presented this in a much more favorable light (see my other posting) that might have actually moved the PPS up.  Notice the fairly good recovery from the low PPS today.  Maybe the market is starting to realize that Hession says things not so well that tend to make the stock tank, but hey, he's delivering some very good stuff and in hindsight it wasn't bad news.  Nevertheless, I'll keep pointing out his weakness on this.  In fact I'm expecting it to continue.  Just like some guys over promise and under deliver (and vice versa), MH's reputation is forming with the market in his rookie year as CEO.  That's a good thing, because sooner or later the analysts are going to catch on.  I have to give the guy a lot of credit for moving the short interest down by ~50%.  Regarding failures - "it ain't over until (he tells us) it's over."  With eight wells planned, we're going to be going on this roller coaster for a while.  But based on his escalating comments, long delay, etc., on Wahoo, he has set my expectation to expect failure at Wahoo.

Get, you seem to not understand the oilfield.  It's a continuous battle fighting problems day in and day out, 24 / 7 /365, "from one extreme to another".  Thatt's the norm.  Some you win and some you lose.  It's just a normal day.  The picture is always changing and being reassessed as more information is gained and after there is more time to digest the information.  A team of staff - engineers, geologists, operating staff, service company reps and even regulators in some cases are all pulling together every day to deliver the well and solve the problems along the way.  Rabbits get pulled out of hats and sometimes you lose wells, and some go really well.  Imagine having a dozen or more rigs drilling simultaneously wiht a mixture of exploration and development and appraisal.  Failure, recovery and success is happening on all kinds of scales, simultaneously all week long.  This drilling activity level (i.e., only 3 rigs running)  at IOC is exciting, but it's little league.  The targets and potential rewards, however, are the best of the major league.    That's the only reason any of us are here.  When you have very little info to go on, you speculate a lot to sound out scenarios to reconfirm your investment thesis.  That's more fun than sitting around waiting for the next announcement.

[Getitrt2]

Question for drilling experts ? If we continue to have trouble with this location does it make sense to change location or change the angle of the drill bit  or to bring in Schlumberger type to help?

Given that Bobcat has 2 sidetracks (3 attempts) to get through the RUBadAss shale (my mental gimick to remember "Orubadi", and Wahoo (IMHO) has likely had more, you can be certain they have tried a number of things.  Moving a rig to another site is not uncommon if the given location has problems.  This might be done when the problems are very shallow.  With deeper problems you just sidetrack and drill directionally away from the problem.  This is a fairly shallow well, so sidetracking here isn't going to get you far away from the problem, it just gives you a 2nd, 3rd, 4th, etc., chance to fight the same problem again.  Moving the rig to another site e.g., a mile or two a way, might make a big difference.  They got Black Bass down a few years ago.  But building a new location has to be very costly.  In the end that may be what happens if they don't "pull the rabbit out of the hat."

Regarding an angle change, assuming the shale is a flat stratigraphic bed, the best way to drill it is with a vertical well perpendicular to it.  That's the shortest distance between two points - entering the shale and exiting the shale.  Also the borehole is most stable in this geometry.  If you approached the same shale with a deviated well, then you just made the path through the shale longer than it needs to be and you have chosen a less stable stress state.

A solution they should be considering is drilling with casing OR drilling with expandable casing.  In both cases the casing and the drill string are one.  You pass through the shale only once and then it is isolated.  Expandable casing is used all the time to isolate unstable zones while preserving hole size.  That's what I would be looknig at.  I also would be looking at the shale samples and optimize the mud chemistry.  But I'm sure they've done what they can there.  Being in PNG you don't have the arsenal of tools, fluids and options that would be available in the USA oil fields.

kaliboo, what you say here makes a lot of sense.  Given Pet's comments it is also obvious why sidetracks may not be the solution here if one knows anything about geometry.  However, given that and the fact that Hession did not mention having done any sidetracks at Wahoo, I doubt they have.  At this point, they may be waiting for some equipment and/or people to get to PNG to try other options, as you imply.

[Getitrt2]

It may be that Wahoo-1, the well currently being drilled, will be a "failure" and will be plugged and abandoned without providing adequate information to evaluate Wahoo the prospect. Or, on the other hand, they may work through the problems and sufficiently evaluate the prospect with Wahoo-1. I didn't read anything in Kaliboo's statements that was anything other than an engineer in the business sharing his opinion, and modest frustration, about the outlook for the well, based on the statements by management. It's always been the nature of the business that things go wrong in drilling wells. Kaliboo didn't make a big deal out of the possibility of losing Wahoo-1 and the rest of us shouldn't either. Wahoo the prospect is just as promising as it was before the well started having problems.

THY, Kaliboo was NOT just sharing "HIS OPINION".  He was speculating and contradicting himself from one extreme to the other, which I don't think is good for us or the stock.  "Losing Wahoo-1", temporarily or permanently, would not be a disastrous crisis; but, although IOC is in great financial condition now, $50 million is still significant, and months lost would never be recovered.  Otherwise, I agree.  I could be wrong, of course, but I think they'll overcome the problems.

Here's another opinion again.  I think Thy hit the nail on the head in his summary of my comments you copied above.  I'm not aware I contradicted anything, however, some of my late postings yesterday were after I finally had a chance to read and re-read a few times what Hession said.  So the picture is much clearer now.  We're lucky to have Pet on this MB.  He knows much more about subsurface aspects regarding IOC and these targets.  Regarding drilling wells and well problems, I haven't read anything he says that I would have much if any disagreement with.

Here's another summary to leave no doubt..  Raptor and Bobcat look pretty darn good based on the very few and positive words MH shared.  Hession is escalating the concern on Wahoo dramatically; it's very clear that it may not succeed in this location.  MH's sharing the bad news on Wahoo first and over-talking about it while minimizing the comparitvely excellent news on Raptor and Bobcat is probably why the stock dipped.  Everyone fixated on the wordy negatives of Wahoo and didn't hear the rest.  That and the fact that they are way over the P50 without any updates earlier, helped to send the price down.  I think he could have presented this in a much more favorable light (see my other posting) that might have actually moved the PPS up.  Notice the fairly good recovery from the low PPS today.  Maybe the market is starting to realize that Hession says things not so well that tend to make the stock tank, but hey, he's delivering some very good stuff and in hindsight it wasn't bad news.  Nevertheless, I'll keep pointing out his weakness on this.  In fact I'm expecting it to continue.  Just like some guys over promise and under deliver (and vice versa), MH's reputation is forming with the market in his rookie year as CEO.  That's a good thing, because sooner or later the analysts are going to catch on.  I have to give the guy a lot of credit for moving the short interest down by ~50%.  Regarding failures - "it ain't over until (he tells us) it's over."  With eight wells planned, we're going to be going on this roller coaster for a while.  But based on his escalating comments, long delay, etc., on Wahoo, he has set my expectation to expect failure at Wahoo.

Get, you seem to not understand the oilfield.  It's a continuous battle fighting problems day in and day out, 24 / 7 /365, "from one extreme to another".  Thatt's the norm.  Some you win and some you lose.  It's just a normal day.  The picture is always changing and being reassessed as more information is gained and after there is more time to digest the information.  A team of staff - engineers, geologists, operating staff, service company reps and even regulators in some cases are all pulling together every day to deliver the well and solve the problems along the way.  Rabbits get pulled out of hats and sometimes you lose wells, and some go really well.  Imagine having a dozen or more rigs drilling simultaneously wiht a mixture of exploration and development and appraisal.  Failure, recovery and success is happening on all kinds of scales, simultaneously all week long.  This drilling activity level (i.e., only 3 rigs running)  at IOC is exciting, but it's little league.  The targets and potential rewards, however, are the best of the major league.    That's the only reason any of us are here.  When you have very little info to go on, you speculate a lot to sound out scenarios to reconfirm your investment thesis.  That's more fun than sitting around waiting for the next announcement.

kaliboo, if you think you have not strongly contradicted yourself, reread my postings in the two or three threads involved, but I'll accept your indication your thinking may have evolved or just changed.   Maybe posted conclusions should be preceded by more study and evaluation.  I think that is more Pet's approach.  On the other hand, your experience and expertise is valued, along with his very much as you say.

I agree with you on Hession's communications approach and presentation.  I also think he should have provided more information and comments on their intentions and efforts going forward on Wahoo.

I have never worked in an oil field, or for an oil company, but I have learned a hell of a lot while following IOC extremely closely for eight years or so, including from Petrengr1 and others.  I don't think I've heard of these kinds of problems with a well before, but I don't think there was as much detailed information or openness available in the past, although we were aware they had various problems with Elk and Antelope wells.  Thanks for these very interesting comments. I think we have common interests and goals here, and a common search for the facts and the truth, while providing different kinds of expertise.