EWT is not what Short's say it is

[Tree]

No wonder DPE said no need for EWT.



From SEC Filing:  

AMENDED AND RESTATED INDIRECT PARTICIPATION INTEREST AGREEMENT

"EXTENDED WELL TEST" means a Subsequent Work Program that consists primarily of drilling and completing up to four appraisal wells for the purpose of determining whether an Exploration Well has discovered commercial Petroleum deposits or for delineating the geographic extent or size of a Field or Zone believed discovered by an Exploration Well. And while we're at it:

"JVOA" means a form of Joint Venture Operating Agreement agreed to by

InterOil and a Majority Interest of the Investors in such JVOA. Such JVOA shall 

be substantially based on the 2002 AIPN Model Form International Operating      

Agreement, with such provisions as shall be necessary to comply with applicable 

law and the Regulations. Such JVOA shall provide that all decisions made with   

respect to work programs and budgets will be made by holders of a majority of   

the Participation Interests in such JVOA and for payment of the fees payable to 

InterOil under Sections 5.4 and 5.5 of this Agreement. InterOil and the         

Investors who will be a party to such JVOA will each negotiate reasonably and in

good faith regarding the terms of such JVOA."                                    

[Tree]

Yo Boston, Bonk, Sussman, Gefvert and all you others that knew better,

Extended Well Test is not testing flow rates for and extended period of time, it is the act of drilling an 'extended' perimeter around the initial exploration well to define the structure and create production wells within.

No wonder Phil eloquently stated:

..."InterOil chief executive Phil Mulacek slams as “stupid” the need for such testing on Elk-Antelope given record-breaking flow rates."...

And given the definition of EWT, Phil is proven correct in this statement. I know, I know he likely stepped outta line by using such a coarse word as 'stupid'.

Stupid is as Stupid does. It would have been stupid at that time to drill more exploration wells can we all agree?

The shame is much of the world can't handle men calling a spade a spade any longer I guess.

[Palm]

Hoho interesting Tree. Obviously has never been a need for EWT as defined. The one snakes have been throwing around for years is old and outdated due to new seismic and other testing methods available. This should end any discussion for any need for EWT at EA or Tri; just not necessary and a waste of funds. The government sees no need for wasting dollars like this. How's this for EWT? Ant 1 hit, then Ant 2 was drilled a couple of miles away. Result; same reservoir and its full of gas and producible condensates. How much more extended do you need? None; it's stupid to even bring it up as an argument anymore against IOC.

[admin]

Well, if this is stupid, then just about everybody is guilty. I'll leave it to the linguists or the resource engineers, but I thought an extended well test means flowing it for a considerable length of time in order to assess the level of pressure depletion (and recovery, after the test is finished). Anyone who disagreed with that before this morning, raise their arm..

[Palm]

You miss the point; under both definitions of EWT the IDEA of the need for EWTs is stupid because one is grossly outdated and the other (in the IPI Agreement) says by its definition that it's not needed. That's what Phil was saying; the idea of the need for any EWT is stupid.  Not saying people who believed the EWT definition was for an extended flow test are stupid. No need for any hands to be raised.

[Tree]

Well, if this is stupid, then just about everybody is guilty. I'll leave it to the linguists or the resource engineers, but I thought an extended well test means flowing it for a considerable length of time in order to assess the level of pressure depletion (and recovery, after the test is finished). Anyone who disagreed with that before this morning, raise their arm..

Phil's arm is up and so are all those that gave him the benefit of doubt, so mine is too.  The choice was simple, either believe Boston, Bonk, Sussman and Gefvert or believe the CEO who is in charge of where your investment is.  Goes to show us all again, those deceivers should be the suspect ones not the management.

Here is what Gefvert had to say in a brilliant SA piece last August and he quotes his hedge fund buddy too:

...:Only an extended well test (over a period of weeks) would provide enough information to confirm that this is a commercial discovery. IOC has not conducted these simple tests."...

"Did you see last week that, after the company basically promised a HUGE deal with Shell (which is the main reason why the stock ripped up $20), it turns out that IOC never let Shell into its data room?! (this is the most basic first step in the process IOC claims is going on). Why won't IOC let potential partners into its data room? Because if any knowledgeable person saw the real data (or, specifically lack thereof) the game would be up...

Also, The condensate stripping plant expenses are comically low. The issue with the condensate stripping was always going to be dry hole blow back. You can't test for that for $4 million. Only evidence - they have done NOTHING on the condensate stripping plant that is worth doing."

This article is regarding the first accusation by the hedge fund manager in that InterOil doesn't have good data on its wells and therefore is hiding it. "

*****

Too funny and to trust anything these shorts propose is idiotic.

[admin]

Huh? I'm probably stupid, but I understood an extended well test as being just that, an extended well test, meaning flowing a well for an extended period of time in order to assess any pressure (and subsequent recovery) of pressure, which serves as an indication of resource compartmentalization and the commercial qualities of a resource (but keep in mind I'm just an amateur in these matters).

I believe that until this morning just about everybody understood it that way, long or short. I'm not ashamed to admit that I'm rather surprised by this new concept from the SEC filings, and it could just be me, but I suspect I'm not the only one..

I also believe that having this notion of what an extended well test is doesn't make one a believer of Gevfert or any other short, so I fail to see your "simple" choice here, but that's also probably just me.

But like I said, let's leave it for the linguists and/or resource engineers.

[Tree]

We needn't leave anything to linguists or engineers. EWT matter is settled. EWT by definition will be done as the E/A is drilled for development. In fact Ant-3 was part of the EWT!

The point is management deserves the benefit of doubt not the short hacks that have been proven wrong on every ever shifting argument they throw out there.

Trust management blindly? No way. 'Trust but verify' like Reagan said when dealing with the Soviets, heck yes. That is how this EWT issue turned out as have all other sunken short arguments. I bet these short guys knew the difference too, Gefvert referred to a 'lack of an SEC compliant resource estimate' and that implies they knew the EWT definition filed by IOC to the SEC. It's impossible to have reasonable debates with known deceivers.

[jft310]

And that's why Bonk never belongs on SHU!That's his game distort and twist. Thats why there is a yahoo .

[admin]

You're really getting silly here JFT. This is a red herring. If that is distoring and twisting, then I'm as guilty as he is, as I was also under the assumption that an extended well test is, well, just that, an extended well test, that is, flowing it for an extended period of time, to assess pressure depletion etc.

Anyone who didn't think this was the case before this morning raise their hand.