ADI - Adelphi Energy

[Agentm]

i checked out the patterson 30 rig, and did a rig search, its on the fianl stages of a well for BOPCO, well EL COYOTE RANCH 4 .. putting in the production casing, so you never know, if they an finish that off and dissassemble and reassemble in 3 weeks??



nothing happens now, maybe a release of kunde 3 news in the next 3 weeks, but apart from that i cant see much action.. i dont have a problem waiting as there is nothing that can change history, but last friday was a touch dissappointed the news had be delayed until after close.. for me it was an unforseen delay, i didnt expect the jvp's would be out of the loop and not reporting delays earlier


time to leave it in the bottom draw for 3 weeks, and see what they do mid to late sept, perhaps they will drill Sl2, or maybe delay again, and pehaps we will get a test done on the lower sugarkane zones.. who knows? only TCEI and the jvp's as far as i know, there seems always to be more to each delay than meets the eye.. TCEI were still putting through leases late last week, indicating to me they are not quite ready, so the play must be significant for the delays to continue.. and we are certainly being kept out of the picture on all fronts right now.

one thing is certain in my mind, i will hold until the 16 wells are completed, and endure the frustration of these ongoing delays as best i can.

 

[Agentm]

just thinking about how TCEI has had to plan this SL1 well..

they knew fron the testing at Kunde 1 and losing kunde 2 that the sugarkane had some potential.. then when the JVP was formed they knew the SL1 well was never planning to go to to 21,000 feet..

the RRC permit plan TCEI submitted in july 2006 was for 14,500 feet,, yet the same plan for SL1 well in the EKA prospectus dated 2 MAY 2006 had a lot of detail in it.. on page 10 of the independant report by oilfield Development Specialists LLC, they had the schematic drilling plan for 21,000 feet..

TCEI were caught out a little, their normal operation would be to confirm the field, then perhaps just shut in the well at 14500 and buy acreage... but with 3 aussie jvp's, they had a problem, they have to explain to shareholders, how do you announce to the market the well supposedly drilling to 21,000 feet is being shut in without testing it?? and at 14,500 feet?? i see the option was to go to plan b..

at that time the well was re-permitted to go to 21,000 feet, late sept 2006!!!

sure the hosston sands needed looking at, but when you have just discovered a major discovery like sugarkane, how hard would it have been to be optomistic about the sands?? and risk the well???

Since the sands were drilled, we had every possible delay you can find, and at the same time TCEI has been working at full tilt to secure each and every lease in the area.. i can see only one reason for that connection..

i look at this whole operation and ask some questions..

how on earth can a small player like TCEI blitz all and secure each and every lease?

Why are they delaying still the well results and testing?

imho the only way a minor player like TCEI can take out all opponents and secure all acres is by having a very powerful backer.. i cant think of any more powerful than conocophillips.. ADI have stated openly that TCEI got leases in direct competition with major oil companies... the only way they can beat them is to have a pretty powerful backer dont you think?

imho the delays are still paramount in the scheme of overall operational success of the project.. conocophillips would set certain goals and operational objectives, and i think they are perhaps just needing a few more things to happen before the 16 wells will be started..

as i said before,, this is all bottom draw until TCEI has done what it needs to, and in 3 weeks that may be enough time for things to be done..

you know every day i wonder how soon it will be before the jvp's will be allowed to benifit from the sugarkane, and i think they will benifit from it once they are allowed to.. this is a unique situation here,, someone stated here last week that the play could be according to conocophillips contacts, a major play in the US.. so thats multi tcf material then!!

perhaps the suagrkane play is becoming obvious to many and the share wont have the luxury of tanking, as the buyers may see the value here right now.. means little to me as i am holding all the way now..

good luck to all holders... enjoy the 3 weeks of R&R,,

 

[Evangeline]

Is it possible that the decision to test Hosston first was made because it was known that it was less likely have commericial flow rates than the chalks - in order to put off competitors for the leases?

 

[Broadside]

Nice lateral thinking Evangeline! They usually test from bottom to top but they could have chosen to test secondaries on the way down, instead they chose to press on and not do wirelines until they reached TD. So maybe Hosston results threw a few off the scent.

 

[Agentm]

did you read the well schematic?? i am suprised no one comments on these things..

they had concern about losing circulation at 12300... (edwards???)

maybe by naming it the edwards, then signing up the austin chalks above it would be easier??


these guys knew exactly what to expect.. and they found exactly what they expected to find..

they were hoping to make it through the play at best.. so best case senario was to use the patterson rig like they used at kunde 1 and drill a massive hole and try to control it as best as possible.. they managed to control it.. having hindsight from kunde 1 and 2 wells..

as i said before,, each and every thing you look at, every aspect of this well, the 5th or 6th well into the suagrkan, made it very very important for the well never to be tested as the data has be made public immediately through the RRC, and very very important for acreages to be signed..

draw your own conclusions.. i have drawn mine and i hold for the major discovery senario!!

 

[Evangeline]

I thought for sure the sp would tank badly today after the delay announcement. It appears that holders are hanging on tight however, and we have no repeat of large holders dumping. Thank goodness for that.

 

[tarzanhey]

Is it possible that the decision to test Hosston first was made because it was known that it was less likely have commericial flow rates than the chalks - in order to put off competitors for the leases?

My we are suspicious arent we? - actually I have been thinking that for some time and stopped myself going too strong on the idea "conspiracy theories" as it seemed a bit unlikely. But lets just say the chance of a distraction from the main objective may have been a golden opportunity to keep it all underwraps ---------------- for a year!!!

how much acreage do they have now????? lots

 

[Ken]

AGENT IF THIS COMES OFF. AND THE SHARE PRICE GOES FROM 60 CENTS TO $2 YOU WOULD BE PAYING YOURSELF A WOPPING $2.45 AN HOUR.

YOU HAVE PUT HEAPS OF RESEARCH INTO THIS STOCK.

Surely you must be filthy knowing that other stocks have taken off, and your racking your brain, trying to figure it all out.

TLSCA have given better returns over the last 12 months.

Just a thought....

 

[Agentm]

800 bcf is worth $6.50 a share.. a few tcf and i think i will be selling my lot at a different price to yours..

ken dont concern yourself about me on any level ok. i am a big boy and can look after my own affairs.. i am posting as i am interested in the stock, and not posting here for advice.... if others gain something so be it.. a lot of people resent my research,, and become very personal..

there are many stocks that have gone up,, and many that go down,, hindsight is a wonderful thing ken, i hope you get wonderfiully rich with it.., but you dont need to teach me anything i think i can clearly realise, my next stock i roll into is still waiting for me.. after that, and infact after this share, i dont have to worry about a thing..

if the delays over the sugarkane discovery were over a 50 bcf play i would be long gone.. i invested for a certain outcome, and will sell when the share reaches that point..

thanks for you remarks, and again i dont need you to be concerned at all about anything to do with me ok!!

until something changes the fundamentals of the research i have done, and wont change my strategy..

cheers

 

[Ken]

No worries agent.

Just being a bit cheeky

I am sure you have dominated the markets for years.

I have just seen you on ADI for a while. I hope it pays off for you and me!

 

[Agentm]

ken i dont mind discussing the issues concerning adi and the massive sugarkane play.. it has nil to do with me personally. the hydrocarbons have been there a long long time,, and the TCEI / conocophillips processes there interest me.

some plays your guessing if there is anything there,, this play you trying to guess how many tcf will be there.. thats why i stay in it.. conocphillips dont do this sort of thing for nothing.. they dont drill dry holes, and they have not drilled a dry hole here so far.. for me thats whats it all about,, conocophillips and multi tcf.. nothing else!! i research to make sure i am still getting the right signs that its all on track..

 

[resourceboom]

Agentm, Don't want to mislead any newbies, saying 800bcf is worth 6.5 is wrong imo.

ADI has approx 15% NRI, so 800bcf = 120bcf for ADI.
At current gas prices, approx US$5.7 ADI share price would probably valued at about AU$2 per BCF once proven, so $240M mkt cap or approx $2 (as over 100M shares)

So 6.5 would have to be potentially in ground value (different to saying $6.50 per share)

unless you mean 800BCF, plus rich liquids but that should be said differently.

Sorry for rambling, all the best folks!!

800 bcf is worth $6.50 a share.. a few tcf and i think i will be selling my lot at a different price to yours..

 

[daeff]

I am a little confused here regarding NRI

I understand that ADI has for all depths a 20% share and until intial expenses are returned, access to 25%....

What is the 15% NRI you refer to... I may be the ignorant one here.

 

[resourceboom]

Hi, yeah, was quoting figures off the top of my head, may have been off slightly.

There are many different % figures that are available, have been mentioned in announcements before somewhere.

PI -> Paying Interest
WI -> Working Interest
NRI -> Net Revenue Interest

When explorers farm in to a prospect, they pay a set % (PI)
But they only get a working interest % (WI)
Then there is often other royalties to landowners etc, and you are left with (NRI)

Someone who has the real figures for ADI SL JVP may be able to help here,
actually I think it might be a bit higher then 15% for ADI. Think it might have been between 15 and 20 ??

Just looked up ADI website:

Terms of Adelphi’s Farm-in Deal
Farm-in terms for Adelphi are modest at 1.25 for 1 for any costs in relation to the first well and associated prospect leasing costs.

The net revenue interest (NRI) across the various existing prospect leases ranges between 71% and 75% after allowing for royalty payments to landowners and third parties. In a success scenario Adelphi will receive 25% of the NRI until payout of its farm-in costs after which Adelphi’s share of the NRI will be based on its 20% working interest.

 

[Agentm]

hey resourceboom..

i look at the brokers report from last year on the ADI webpage for the SL1 and what they said the value is for the 800 bcf hosston sands would be..

if you look at that, are they calculating the values correctly? and if not what do you feel is misleading there..

i have been working the values off what they calculated up until now, but would be interested in your opinion on say what a p10 1tcf would achieve to the sp for adi..

 

[resourceboom]

hey resourceboom..
i look at the brokers report from last year on the ADI webpage for the SL1 and what they said the value is for the 800 bcf hosston sands would be..

if you look at that, are they calculating the values correctly? and if not what do you feel is misleading there..

Hi mate,
Don't think the brokers report is misleading, but working off slightly different parameters. ie I believe when the report was written the spot gas price was around US$8 with a weaker AUD, compared to now, with approx US$5.7 and stronger AUD, so I think that would make a considerable difference in valuation.

i have been working the values off what they calculated up until now, but would be interested in your opinion on say what a p10 1tcf would achieve to the sp for adi..

As I've mentioned elsewhere I'd be stoked if they prove up 800BCF, and we get a $2 sp, especially if they come out with some great news before EKAO expiry time. 1TCF, will attempt to value it better when / if the time comes

 

[Agentm]

well if it drops off 25% to $6 for 800 bcf, then 1tcf looks enticing..

i look at how much the gdn share increases for a well thats not even commercial,a and not likely to pay itself off,, and you say we wont get any value for 1 tcf???? you need to explain this a little for me, i am perplexed..

SL2 and SL1 will get some great figures up for us,, not the 1 tcf stuff,, but definately will point us in the direction of understanding how long it would take, and how many wells to get some great p10 numbers..

with conocophillips on the scene, i expect the development will be rapid..

i get the feeling the starters gun is raised, the jvp's are primed with cash,, just need the instructions to start..

 

[mick z]

hi guys,

if gas is worth $6.50 mcf that means 1bcf = $6.5mil
times that by 800bcf then times that by 15% NRI, then divide that by 115 mil shares and you get $6.78 per share.

that would do me, and that's in usd

mick

 

[nioka]

hi guys,

if gas is worth $6.50 mcf that means 1bcf = $6.5mil
times that by 800bcf then times that by 15% NRI, then divide that by 115 mil shares and you get $6.78 per share.

that would do me, and that's in usd

mick

Great. If only there were no costs of production, directors take (including bonus options for performance). Plenty of companies have big turnover, spend a lot on dusters and have very little left for the shareholders. That is one of the reasons I have sold ARQ and this one is in the family. I'll sell at $2 and be happy.

 

[Agentm]

Arq's presentation they put out today..

lots of references to ADI... they are getting very bullish, including ADI into future reserves...

enjoy

http://www.arcenergy.com.au/files/asx/ASX - Latest Corporate Presentation 28 Aug 07.pdf​

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•Disciplined international expansion through direct investment and Adelphi interest ​

page 2


"Massive appraisal potential on both offshore projects and in Adelphi"

page 20 and nice graph with adephi starting to be calculated in there..​

ARC holds 32% of Adelphi Energy Limited​

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Floated by ARC on ASX as surrogate for high impact international ventures​

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Market cap $70 million​

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Operations in USA, Yemen, Timor Sea and Indonesia
Adelphi’s US operations have very high potential
Sugarloaf well –(SugarKaneField)
Carbonate play at ~12,000 feet with potential to extend over a large area already under lease (~20,000 acres leased).
Sugarloaf 1 well has potential pay of 28 meters. Similar to recent producing discovery nearby (SugarkaneField) -gas with high liquid content.
Testing of Sugarloaf 1 carbonate zones scheduled to commence in next few weeks
First horizontal well (Kennedy 1) spudding shortly
Potential for major new play fairway in the area​

Very high activity by major companies in adjacent leases

page 26

if you look at ARQ's future reserves,, adlphi is suddenly appearing there too

page 28

page 27 has kennedy 1h (SL2) in october quarter.