Originally Posted by
zorba
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QUOTE from Chalice:
"Chris,
You are not listening.
Have another read of the debate on this website about this announcement and tell me its so.
Whether or not you agree there is obvious indication that there was an issue.
We all have commented on and think you are doing a great job, don't take the comments as a personal attack - but don't dismiss them either - they are real.
All we are asking for, which I might say on the body of evidence is justified, is some reasonable clarity for future announcements to spell out the obvious.
PS Your summary above + the addition of " non commercial" would have been perfect.... "
END QUOTE
Chalice,
I disagree with your view.
Three cases:
1. The well encounters no hydrocarbons and the well is a dud. Simplest announcement -- the well is a dud.
2. The well encounters 100s of meters of hydrocarbons and the well is a success. Annoucement is more complicated -- but might say well is a success but more studies and more drilling is required to reliably determine potential reserves, and even more studies are required to see how best to commercialise the discovery.
3. The well is neither a failure nor an obvious success. Now the JV operator has to be carefull not to give the wrong impression, either way the annoucement could move the share price unjustifably up or down.
In the case of Momoho-1 the announcement tells it how it is ....... the main conclusion is that further studies are required to see if a development could be viable by combining the hydrocarbons from the three adjacent wells.
In the case of the Momoho structure it also looks like the JV would need to drill another hole on the other side of the dividing fault to test the presence and size of the potential hydrocarbon reservoir indicated by seismic surveys on the north-eastern side of the fault.
But before commiting to another test drill, the JV wants to evaluate the results from Momoho-1 well and no doubt redo the seismic modelling now that they have additional depth control for the seismic reflections. If the further studies are encouraging then another test well could be drilled at considerable expense. In the meantime the JV is being prudent with your investor funds.
Momoho-1 is clearly not a failure nor is it rip roaring success.
Of course investors / traders want the latter.
No point in being peeved if the well does not produce a bonanza.
Z
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