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Another of my holdings, ZPHR, has some parallels with PRD. Looking for oil in USA but they are also looking to open up a new basin and just drilled their second well.
It took ages to update the market - and yesterday we understood why. They hit a natural fracture and were having to figure out how to deal with an over-pressured well and an abundance of hydrocarbons. Nice problem to have, could be prolific for them.
We know that MOU-1 had issues with over pressure and that was at the edge of the Moulaya fan. How’s the pressure at MOU-2?
SLR's 2020 CPR had a 34% chance of hitting the Guercif Tertiary
MOU-1 then did exactly that (the edge of it)
SLR's 2022 CPR now has a 27% chance of MOU-2 hitting the same structure (and remember it's going for the sweet spot)
My point is that the CPR figures are not necessarily that helpful. Read through all the RNS. Watch the presentations. Use all available information. I have looked into PG's soul and my GCOS is 102%
Advance energy went all-in on an offshore drill. Their duster left them with just a few million in cash and no assets.
Predator have already drilled MOU-1 to derisk the basin, pending flow test.
For MOU-2 it’s all about avoiding operational issues with drilling and then flow rates again.
If there is a problem? Sure there will be a drop in SP and likely a raise, but they have a massive licence area with many more prospects and it’s cheap to drill again.
They have already paid some of the costs for next drill, MOU-3.
Plus T&T and Ireland!
So, lazy comparison.
Very happy with risk-reward on offer here
We're all impatiently waiting for spud announcement of MOU-2, but next major news for PRD could be Irish cabinet reshuffle (this weekend?)
If Minister Ryan loses Energy from his portfolio it could be very good for PRD.
I think the interest in Corrib South is likely linked to rumbling behind the scenes...
"The Company expects to be able to update the market in the next few weeks on whether the party that has expressed an interest in the Predator Oil and Gas Ventures Ltd.'s application for a successor authorisation for Corrib South will proceed to the next stage or not following the completion of preliminary due diligence."
https://www.pressreader.com/ireland/irish-daily-mail/20221117/281655374065273
No such thing as bad publicity…
“After weeks investigating, we can reveal that, as those in power grapple with how to help us heat and light our homes while meeting legally binding climate targets, an offshore oil and gas company has been lobbying politicians here about liquefied natural gas.”
The scandal of it.
https://www.irishmirror.ie/news/irish-news/oil-gas-firm-based-tax-28379299
It is about how much gas or oil is in the ground if you sell the whole thing.
Guidance on strategy at presentation evening was that PRD would look to take Moulaya fan into production (CNG) and farm out or sell the rest.
Having said that I think PG will find it hard to resist further drilling - it is so cheap to do that risk/reward is skewed heavily to the upside. I guess we can keep going until an offer is received that properly reflects the value of the licence.
I spoke with Lonny at the investor meet about the current supply chain disruption. Items that previously would take a week or two are now taking months. There is no precedent to the current situation and it is impossible to give an estimate.
He also said that, once we are in a position to drill, it is going to be an incredible 12 months for shareholders. You should have seen the grin on his face...
Drilling a well in Morocco used to take 1-2 months, as they had kept old equipment and practices. When Lonny was at SDX he said 'I can bring in guys to drill a well in 15 days' but nobody believed him. There was very much a culture of 'this is the way things are done here, don't change it'. After a lot of pushing he got his way and the Star Valley rig arrived in the country from Canada. The next drill took 15 days.
This anecdote highlights that 1) Lonny is the man and 2) Morocco can be slow
I let someone qualified answer the geological questions but I know the answer to 2:
No, there is no 3D seismic for simple reason that it’s cheaper to just drill a hole and see what’s there. PG touches on this in presentation on 8th Sept.
This is essentially a 2 man show being run on a shoestring budget, with (hopefully) a world-class asset
Another PG snippet - suggested we could be producing 50 M cfgpd this time next year. Per the presentation that’s an estimated $292mm annual revenue! I would imagine timelines will slip but love the ambition.
Met Lonny afterwards, very impressed. He said that they’re still waiting for some long-lead items for drilling, but once it starts it’s going to be an exciting and fast-paced 12 months for shareholders.
https://twitter.com/dolangeraldine/status/1564392353300889603?s=21&t=dn8VWFuePHPYi0IDCQBbcA