ADI - Adelphi Energy

[Agentm]

mav is never around when you need him..

its done when they expect high pressure gas kicks,, so i would say the massive amount of info on the wilcox plays in the region must conclude that the plays are likely to be extremely high pressure, so they utilise the best practices to prevent blowouts and expensive delays.

Its taking painstaking and long lengths of time to do things on this well, i hear the equipment is reletavely new and needs to be looked at closely and tested adequately before ventuing into dangerous high pressure gas plays,, so good due dilligence is being taken on this well.. the good news is that the delays cost nothing, and they only pay for actual drilling time, and they are about to venture on into the gas zones shortly.

mav would know a little more

 

[kevro]

Thanks Agent M, if thats the case I hope they arn't waisting there time and find lots and lots of high pressure gas.

 

[maverick11]

Hi, I have a question from todays NT ann. Is there any significance to the converting to an oil based mud system prior to drilling ahead?? Why would they do that??

Regards
Kevro

Drilling mud accounts for approx 10+% of a total wells cost, and they employ an engineer (mud engineer) to keep tabs on it, so it is not something taken lightly.

Often regulations govern what type of mud they can use, but switching from water based to oil based would mean they are anticipating gas soon. Increasing the density and visvosity of the mud will help avoid gas kick backs and gas from flowing into the well while drilling. Although I don't know much about it, I think oil based muds would perform better than water based mud with an ass load of sythetic and natural additives to increase the viscosity. Laws or costs may also play a role in the decision to make the switch, but either way, it is a good sign as they are expecting gas targets in the next lot of drilling

 

[Agentm]

nice quarterly.. i was nervous about ADI perhaps announcing new projects, and therefor indicating a lack of confidence in SL and NT,, and i note they say they are keeping their massive cash reserves to fund the current projects!! this is very pleasing news for me,, it shows exactly how confident these guys are on the sugarloaf venture. focusing on it now and remaing committed to see it through.. excellent..

 

[tomcat]

Someone is not too confident there is one seller at 90c for 486,235 shares

 

[Agentm]

yep, as soon as the quarterly went out.. my guess would be a larger shareholder or institution profit taking..

 

[tomcat]

I still hold however and agree with AgentM, there was nothing new in the quarterly and they have a heap of cash to develop SL and NT...the next month is going to be interesting

 

[barney]

Someone is not too confident there is one seller at 90c for 486,235 shares

Howdy TC and other holders, My first impression of the large sell was also "whoa" ........... , but then I thought, this person (more likely insto or group of owners etc.) could be holding several million shares at a very low entry price, and to put this sell order in at this level might in fact force a few "fence dwellers" to sell their positions at lower prices than they otherwise might have (kind of a test the water scenario) or as AgentM said simply a large holder locking in some profits (and if I held a few million shares I would probably do the same) ....... As it turned out not too many "cheaper" sellers jumped in, so I see it as a positive sign regardless .......... but I am a bit biased ............ I still think sugarloaf could be the "mother" of all cabbages!! (for those who don't know, sugarloaf is a type of cabbage ...........my old man grows them, and they taste pretty damn good!! .... lets hope that is a good omen) Barney.

 

[Agentm]

Reading the report over again, then just a thought about ole couchy sprung to mind again,, funny how he still resonates despite the long silence..

As reported prior to the commencement of the well, the mean potential reserves for the Hosston Formation are 800 BCF of gas, and the mean potential reserves for the shallow targets are 100 BCF gas equivalent.​

For those who doubt couchy.. its still there.. just read it the way they state it.. gas for the primary and gas "equivalent" for the secondary..

I see that half the massive dump of shares sold.. nice work for a relatively quite day..

While i am at this secondary thing......

Last month on the road show they were saying 170 BCF on the secondaries on the upside and 1.5 TCF for the primary upside, and today they still use the conservative lowest size for the secondaries as they have all along. It doesnt take a rocket scientist to know that the secondaries were way higher than the upside total, so 170 BCF is out the door.. so its got to be 300 - 400BCF upside territory...

I still hold for all that and more..

 

[JBMMMMMMMMMM]

Based upon the current prevailing gas prices in the region of
around US$6.50 per mcf (approx. AUD$8.50 per mcf) this could provide Strike Oil
with the order of AUD$400 million in gross revenues based upon its 25% working
interest and a 200bcf discovery.

-if 400mill is what STX value there 50BCF

ADI could be looking at 200Bcf + 2mmbl oil at sugarloaf= 1.6billion value= 16xMarketcap

As for EKA 20-30 bagger easy EKAO the rocketship

 

[HRL]

Enough! You're getting me all excited :bananasmi

 

[EEE]

Getting a few punters buying up today, could be quite an afternoon

Could it possibly be in anticipation of an announcement early next week on SL & NT?

 

[Agentm]

nice to see a lot of trade for once


interesting days indeed!!!

are we starting to hear things?

 

[EEE]

Hi AgentM

As an aside, and trying to read between the lines as you’ve often said…

I think there were a few of us who were a little surprised when we read that production testing would take 2 months to complete. Upon reading the Hartleys report and announcements released by Adelphi, I was under the impression that once commenced, testing would take approximately 2 weeks until results are obtained. I’m not sure if I’m correct but I also interpreted the announcement to mean that 2 months would be the total time to test both the primary and secondaries.

On a separate note, I remember reading that if the primary turns out to be unproductive (touch wood), then the workover rig used to do the testing could be immediately employed to test the secondaries. If the primary was productive, then a separate rig would have to be sourced to test the secondaries.

Considering these factors, could one hypothesize that management have given a time-frame of two months because they ‘know’ it will take time to source another rig, because they ‘know’ that they won’t be able to use the same rig, because they ‘know’ that the primary will be successful?

I hope the above is clear, just a thought that’s been rolling around in my head.

Would appreciate your, or anyone else’s thoughts.

 

[Agentm]

the way i read it is that they frac and flow test the primary, then maybe do the secondary..

the only way they will do the secondary is if the primary wasnt commercial.. thats my opinion. its impossible to see them risk a well that cost as much as it did on fracing and flowtesting anything else.. so i think in a very short period of time we will be seeing some results of the flow test, and then if its commercial they will make it into a production well.

the secondaries were decided on months ago.. flow testing will only give them data on something i feel they know is already commercial.

thats the way i see it.. doesnt matter, its all good in any case!!

 

[cicak_kupang]

How do people feel the results for SL will be announced? Will the JVP's say that the well is flowing at xxx million cubic feet/day,or that the reserves are estimated at xxxxxbcf/tcf? How do we calculate flow rate per day into reserve size, and life of well, so we can value the SP? Any thoughts..... as i'm sure its not as straight forward as it may seem.

 

[wallave]

cicak...
I was wondering along the same lines...
Hopefully some of the more informed, Maverick or AgentM can answer.
Thanks also in advance.

Cheers

 

[fflintoff]

“the successful Sugarloaf-1 well onshore Texas”

Article on ARQ which describes Sugarloaf as “the successful Sugarloaf-1 well onshore Texas” i.e. without any qualifications etc

http://www.oilbarrel.com/home.html

“2007 Will See The Drillbit Test ARC Energy's Diversified Portfolio With Wells Planned In The Canning Basin And Yemen

Over the past couple of years Australia's ARC Energy has been looking to diversify its Perth Basin business. This diversification process started with a shareholding in exploration outfit Adelphi Energy, currently drilling in the US, grew with the 2005 acquisition of Voyager, which held interests in Yemen, and has continued with the purchase of a significant spread of assets in Australia's Canning Basin.

These interests have balanced out a portfolio that was heavily weighted to the Perth Basin in Western Australia. Focusing on one area enabled ARC to leverage its expertise, acreage and infrastructure, but the company recognized the need to cast its net wider to find another foundation asset that will keep its pipeline of prospects flowing over the next three to five years.

This is not to say the Perth Basin doesn't retain a special place in the ARC business model. It is, afterall, the sole source of the company's production, which in the last business quarter hit record levels, helping to lift sales revenues for the quarter by A$1 million, almost hitting A$30 million for the three-month period, despite a 22 per cent drop in the price of oil. Oil volumes were up 34 per cent, largely due to the contribution from the completed Jingemia-8, Eremia-6 and Hovea-12 wells. Gas production was slightly down due to natural field declines.

And the company continues to grow its Perth Basin business. After a period of development work aimed at boosting cash flows, the company is now looking at exploration opportunities. In recent years the exploration record has been patchy, prompting a major geological review of the Perth Basin to better pinpoint prospects. Those now on the drawing board include the onshore targets Drakea-1 and Beharra Springs Deep-1 while offshore the company is eying two firm wells, Frankland and Perseverance, and one contingent well, Dunsborough.

Investors will, however, be keeping a close eye on the company's new ventures. These include the Canning Basin, a remote and little drilled area in the north of Western Australia. Over the past six months ARC has assembled an extensive acreage position in the Canning Basin and this year it plans to drill up to eight high impact wells, with the first, Stokes Bay-1, expected to spud in April or May.

This well has two targets: the shallower Point Torment gas sand and the deeper Valentine prospect. In all some 20 leads and prospects have been identified on the new acreage. To help prioritise prospects and formulate forward drilling plans, the company plans to acquire aeromagnetic data, gravity data and over 1,000 km of 2D seismic in the 2007 dry season.

In Yemen, ARC has a 15 per cent interest in Block 35, with drilling expected to start in March on the Reeb-1 exploration well. This will be followed by the Magrabah-1 well and possibly one further well. The company also has a 21.25 per cent share of blocks 7 and 74, which have yet to be formerly ratified by the Yemeni government. This is expected shortly, at which point the joint venture will start seismic work in mid-2007 ahead of drilling in 2008.

Finally, having seen shares in Adelphi Energy increase three-fold on the back of the successful Sugarloaf-1 well onshore Texas, ARC has exercised its option to increase its shareholding from 28 per cent to 32 per cent. This could prove astute, particularly as the New Taiton well is now drilling ahead and Sugarloaf has yet to be tested. Adelphi also has a small stake in Yemeni blocks 7 and 74. With wells on its own account and through Adelphi, ARC can promise investors plenty of drillbit-led newsflow in the year ahead. “

 

[Agentm]

i would have thought the forward planning of further wells at sugarloaf in itself was an indication of exploration success, regardless of confirmation of TD and any form of flow testing..

ARQ has always been bullish on the well in all the presentations i have sat in on. I cant imagine they will change their positive tune.

things must be getting close, both the gas zones at NT and the commencement of flowtesting..

BTW if you read the report on flow testing from the 29th jan carefully, you may note it says it will start flow testing withing 2 weeks, and then goes on to say something very interesting... as usual you have to read between the lines..

Further ASX releases in relation to the Sugarloaf-1 testing program will be made upon any material developments and results from these tests.

if you remember the frustrating days of drilling and getting double meanings and hidden messages, then you must assume that they could be well and truely flow testing as we speak, and we can only expect the usual standard practice of "material developments" being reported.. so perhaps dont expect any major announcements or indications of where they are at between now and when things get announced!! I have yet to see them change their practice of maintaining a closed well senario as much as possible.

once again all IMHO and DYOR...
​

 

[JBMMMMMMMMMM]

hope ya right -Agent man-I see John Campbells been talking Sugarloaf down again saying it'll be lucky to hold 200BCF. Hope he's wrong got alot invested in Sugarloaf