VIL - Verus Investments

[condog]

Clearly there are some who are trading and follow trends which good on you nun, i hope you profited big time from this week...i really do...

But there are others who look at the fundamental underlying assets, positions and plays.....calculate possible upsides vers down and then take a position of exposure.....

Wysiwig i hear what you say and in 90% of cases i agree which is why i research my stocks so *****oughly before taking a position in them....

Pilots you are very correct there are lots of dusters....Salt domes are notorious for producing wells of prolific resources within meters of absolute dusters.....they have a strange geology in that sense.... the fact GGP VIL managed to locate potentially promising pockets on multiple layers in there first well is absolutely fantastic and possibly the major reason why they are taking so long to test and understand the formations they have encountered.....becasue they know they could drop a second well and potentially come up dry if they dont get a good understanding of what they have.....

Wait see fellas...hold your judgement......and then one of us will be able to loudly say "I tried to tell you......"

 

[condog]

Possible scenario

three sands

deepest 1.8mmcf + 56 b condensate

middle had higher pressure = big kick say 2mmcf 120ft

top layer potentially oil, but say gas 1mmcf

= approx $8-14M p.a on a $ 20m mcap

at pe of 10 with industry average of small producers at 17

= macap of 80-140m = sp of 20 - 35c

Go for it cynics, but try and be at least 5% objective...

 

[pilots]

Possible scenario

three sands

deepest 1.8mmcf + 56 b condensate

middle had higher pressure = big kick say 2mmcf 120ft

top layer potentially oil, but say gas 1mmcf

= approx $8-14M p.a on a $ 20m mcap

at pe of 10 with industry average of small producers at 17

= macap of 80-140m = sp of 20 - 35c

Go for it cynics, but try and be at least 5% objective...

Condog, sorry mate, but the bottom zone 99 times out of 100 is the zone with the most pressure. You are quoting numbers and dollars, and yet they have not given us ANY flow test to go on, this well is NOT YET COMMERCIAL, that cant happen until you get ALL the flow rates. If you have a look at hot whoppers you can read all the BS in the world about people who have Geo mates in the US who have had a look at this and it is a going to be massive, what rubbish. The ramp team is in full swing, just read the rubbish.
You your self said the word you must look out for, you said POCKETS of oil/gas, if they have found any thing, thats what it will be just a small pocket, most times it wont pay off the cost of drilling the well, how ever it will push the SP up so as they can drill the next well.
Don't for get they did not get the name of the Balcatta cow boys for no reason all all.
Condog, how can you spend all day like the ramp team talking about how much Gas and Oil this well has when NO ONE including VIL have a clue whats in the well YET, this is the kind of ramping that get new posters sucked in to buying this type of stock and then get bunt.

 

[So_Cynical]

Condog, how can you spend all day like the ramp team talking about how much Gas and Oil this well has when NO ONE including VIL have a clue whats in the well YET, this is the kind of ramping that get new posters sucked in to buying this type of stock and then get bunt.

Condog Ramping? :error:

How can you call it ramping when he clearly puts DYOR and this is not financial advise etc on each post...surely this absolves him of all blame and responsibility for anything anyone else does.

He is just expressing his very positive opinion of the upside possibility's.

 

[condog]

Are we here to discuss VIL or carry on with this rot....casue personally i thought this thread was about VIL

 

[pilots]

Are we here to discuss VIL or carry on with this rot....casue personally i thought this thread was about VIL

OK lets talk VIL, how can any one come up with ANY FIGURES of what this well is worth when no one has a clue as to what the well is flowing. By now the test crew will know what the well is capable of, the time they have spent testing up to now tells me that the bottom zone is with out doubt will be a duster, if it was any good they would have been telling you b4 now.

 

[Atlas79]

OK lets talk VIL, how can any one come up with ANY FIGURES of what this well is worth when no one has a clue as to what the well is flowing. By now the test crew will know what the well is capable of, the time they have spent testing up to now tells me that the bottom zone is with out doubt will be a duster, if it was any good they would have been telling you b4 now.

Is it absolute certain that they may not have their own reasons for not disclosing immediately whether or not it's commercial? I'm curious because the share price is holding at about 5c pretty well... is that purely because of hype and ramping?

 

[condog]

OK lets talk VIL, how can any one come up with ANY FIGURES of what this well is worth when no one has a clue as to what the well is flowing. By now the test crew will know what the well is capable of, the time they have spent testing up to now tells me that the bottom zone is with out doubt will be a duster, if it was any good they would have been telling you b4 now.

Pilots the word speculative or explorer indicates your investing in something that has not yet located or produced its claimed or indicated resource.....

Claimed and indicated or inferred to an untrainined or inexperienced investor can be exceptionally dangerous and risky, because anyone can claim or infer anything without so much as a sniff or reality.....

However thats where research and experience can help guide the process... If every investor waited till every company had a quantifiable proven resource , there would be no new entrants to the market and the world as we know it would not exist.....the equity markets would be starved of capital...

Sure there are cowboys out there running around making rediculous claims and coming up with nothing, there are also good people trying to legitimately improve share holders value...,,,,

Not all explorations are going to come up trumps, but as early phase speculative investors (not traders), if we are chasing the growtht hats possible in this phase, then its our job to use research and knowledge to sort the good from the bad, the likely from the unlikely......

The only way to do that is to begin deeply researching the probabilities and likelyhoods of success as i have briefly and only partially indicated in the 17 questions above.... its that type of thinking, plus analysis of cash burn rates, surrounding venture, looking for positive indicators that allow you to analyse the risk and take a decision on a speculative stock liek this or any other junior oiler....

Once you think its got some good positive signs i then start running possible numbers.... again the only thing you have to go on are signs / indicators / estimates and surrounding fields..... which allows you to calculate likely or possible outcomes......

If i was only placing $5K in these things i wouldnt bother its too much work, but when your playing a bigger play its important to know your risks , calculate them and have the numbers in your head so that based on those possible scenarios you can make well informed decisions when future announcments are made....and as developments proceed....I havent got to the position im in by being a blindly optimistic idiot....i have made my money by taking well calculated investment decisions and risks...from doing and insane amount of research on my investments...

The entire reason im still confident on this stock is things have actually remarkably improved on the reason i invested in it.....I took a more informed approach and a more patient approach then the day and short term traders who have jumped into and out of it on each announcment......

I originally analysed this one and decided on the probability of salt domes, this salt dome, GGP record and its experienced personel, the average rates found elsewhere around the dome, the tenement size, the cash they have up there sleeve, the possible out comes based on poor, good and excellent flows over multiple wells that with such a low market cap and such a likely positive outcome it would go up in value.....

Up to this point ive been 100% correct, I was saying that back at 3c, its now holding 5c, why because the postive sign of hydrocarbons and gas irrespective of what happens on this well, has made the play more likely to have a positive outcome then when i bought at 3c prior to drilling starting....

If the traders want to bash it up to 9c thats there right, next time i will probably take a part profit just in case, but i will also hold incase its going further......

In terms of ramping i take a lot of offence to that reference....if i was ramping i would have sold all at 9c after its peak and rebought yesterday...I held because i actually believe in what im saying..and more importantly i want exposure to the possible upside on this stock....

 

[nunthewiser]

Condog, sorry mate, but the bottom zone 99 times out of 100 is the zone with the most pressure. You are quoting numbers and dollars, and yet they have not given us ANY flow test to go on, this well is NOT YET COMMERCIAL, that cant happen until you get ALL the flow rates. If you have a look at hot whoppers you can read all the BS in the world about people who have Geo mates in the US who have had a look at this and it is a going to be massive, what rubbish. The ramp team is in full swing, just read the rubbish.
You your self said the word you must look out for, you said POCKETS of oil/gas, if they have found any thing, thats what it will be just a small pocket, most times it wont pay off the cost of drilling the well, how ever it will push the SP up so as they can drill the next well.
Don't for get they did not get the name of the Balcatta cow boys for no reason all all.
Condog, how can you spend all day like the ramp team talking about how much Gas and Oil this well has when NO ONE including VIL have a clue whats in the well YET, this is the kind of ramping that get new posters sucked in to buying this type of stock and then get bunt.

I agree with 95% of this post and there should be more of it in these penny dreadful threads.

not here to call condog a ramper, just agreeing with the crux of this post ..

as you were.

 

[condog]

Obviously we are likely to get an announcment before mondays open and the markets shut so hopefully people will have enough intelleigence and character not to see this as ramping....

Lets look at this objectively:
Starting Globally - Louisina salt domes are prolific producers
Fausse Point is a prolific producer

GGP has a strong early record for a small cap - see bullseye results, with some fine personal......although they need someone to teach them how to write announcments.....

The tenement is good in size, located close to existing pipeline <6km at $30000 per " per km piping costs
The tenement has not been depleted by other producers

There is hydrocarbon and gas signs and correct formations now confirmed

Then this well itself.....
Gas and oil shows
Huge pressure kicks
Gas and condensate flowing to surface
1.8MMcf + 56b condensate pd with no simulation
Formation shows where positive

Irrespective of whether you belive this well is the ducks guts or not those are massively positive signs compared to drilling in a cow paddock with and inferred resource.....


What the pesimists and ill informed are jumping to conclusions on is the fact they have taken time with testing and the fact the inital flow is only 1.8mmcf.....they are failing to realise this is a 9000ft well with 5 zones across 3 sands.... it may well come up a duster, but at this stage theres more to be optimistic about then negative.....

The poor choice of words in multiple announcments has spooked the short term traders and investors who are just part of the herd with no full understanding of the stock.....

DO NOT GET ME WRONG - investing in these things is very risky and at the end of the day it could all amount to absolutely zero.......but the fact is there are way more things to be positive about here then negative.....

The one word that spooked the herd was "inconclusive" and boof, they all bolted, like a pack of pathetic sheep......all jumping off the cliff like little ill informed lemmings.....

Look at AZZ had the exact same thing happen and now its at 70c

My advice is wait and see , dont make idiots of yourself by making pre-judgments and definitive staements on this one till we see what we have.....

Run some calcs, know your risks.......and be super wary of down rampers and fear campaigners....it spreads like wildfire....negativity is the killer of hope and progression.....

At the end of the day its your profit and your loss so do DYOR, seek expert advice....

 

[nunthewiser]

My advice is wait and see , dont make idiots of yourself by making pre-judgments and definitive staements on this one till we see what we have.....

..

But thats what you have been doing all through this thread m8


Pilots is showing the other side of the story...........


anyways......... good luck with it

 

[Joe Blow]

Can everyone please stop the name calling and accusations and stick to discussing the facts.

If you feel someone's analysis is flawed then you are entitled to point that out. But making things personal and attacking others is only guaranteed to lower the quality of the debate.

Now lets please get this thread back on track. Any off topic posts or posts with no content will be removed, as will posts that contain personal attacks or name calling.

Thank you all for your co-operation.

 

[pilots]

Condog, I interesting you mention AZZ, look at the way they are reporting from the well site, only FACTS, look at any of the big company's, only FACTS, now look at our old friend GDN, they all so have learned the hard way, they now are only posting FACTS. You will never get the big end of town in bed with you when your SP can fluctuate up to 30%.
Now look at VIL, Formation shows positive,Gas and Oil shows,huge pressure kicks,Gas and condensate flows to surface,1.8MMcf +56b condensate with no simulation, any company that post that kind of information is grasping at straws. But what tells me most of all to steer away from this company is the massive amount of posting of rubbish on other forums, just look back over the last few years at the companies that had the hell ramped out of them, what happened????
We will be traveling for the next month, so I wish all of you the best with all your shares, good luck to all.

 

[condog]

Riveting conversation you negative guys , keep it up.... the hard hitting facts your supplying, the scenarios your putting forward are just amazing keep it up....none in 30hours.... wow you guys really know your stuff when it comes to VIL

In the meant time i suggest investors look at the oct investor presentation and compare it to whats been achieved so far.

Also compare the press releases to those at bullseye in early 2009...you may get a pleasant reasurance from that comparrison.....GGP press releases on bullsey never once identified proper flows until they actually released production results.... they hold there cards very close to the chest...

 

[condog]

So where to tommorrow if theres no announcment.....

Well for starters we are talking about a junior explorer...so far with exceptional results GGP and VIL along for the ride.....

GGP announcments on bullseye shich is a tremendous success has been very similar to GGP announcements on this project so far....ie: lacking detail and IMO poorly worded

GGP took a very long time to confirm production on Bullseye

We have 5-6 zones in this there very first well to test and in all likelihood a second well is booked irrespective of this result....

They have increased lease holdings at fausse point by 80% plus on the back of initial findings in this well.....

They have found gas at 1.8mmcf unstimulated on a 6/64 choke....if the psi is high a bigger choke will flow substantially more....

If psi is low this is marginally feasable but they have 4-5 more zones to test includiing the primary 7500ft deep oil target.(which showed 120ft thickness and positive sidewall logs for hydrocarbons on the way down)...in this well alone....

IMO The market significantly over reacted negatively based on the word "not definitive" they failed to see the word "confirm " in the same announcment..... they also reacted on the number 56 B condensate per day, not realising that this zone was only aiming at gas...any condensate or oil would be a bonus.....those that did get in wanting oil didnt know the play..... but the 8th Feb announcment didnt make clear whether it was condensate or oil flowing to surface....so its understandable....
What the doubters and day traders didnt know is that GGP have proven to be extremely guarded and conservative in ther release of all previous statements....they have a history of very slow testing and being certain before they disclose anything.....

Currently we have 56 B condensate plus 1.8mmcf gas which equates to around 200BOPDe with very very low overheads ..... and low piping costs to sales....

If this was 30 miles to sales pipeline it would not seem commercial at all yet, but given it is extremely close even at present rates if they can be sustaind or improved through stimulation then its IMO more then 50% likely to be commercial.... but definitely hold your judgment and do not act on that till further news....

a second well or third well would be highly likely in the event they chose to proceed to target the other zones, this would make commercial viability of pipeline significantly more cost effective...

Three zones with say bottom one producing 200BOPDe unstimulated worst case scenarion, say 150 and 100 at upper to zones = 450 BOPD e

Plus theres a distinct possibility IMO the upper primary target oil zone could still very much surprise to doubters to the upside....especially if stimulated.....

Possible unstimulated scenario = 450 * $35 net = $15750 pd
= $5.75M per annum at PE of 10 = 57.5 mcap = sp of approx 15c

Now if they can sitmulate that or run it on a bigger choke due to high psi results could be double to quadruple that......

If however thats as good as it gets then we are IMO looking at commercial production but FP#2 will be the key sp driver...... and FP#1 would IMO validate sp of 6-9c increasing as FP#2 approaches...

IMO if this is a duster we will initally see traders sell off but a sp of 4-6 c is warrented based on significantly better prospects and confirmed presence of formations, porosity , hydrocarbons and gas, then when it was comfortably holding 3c range....

I hope we will have an anoouncment tmoz, but the last one seemed to indicate they would test for several days in the coming week...also presidents day...sunday etc.....so dont hold your breath, but watch closely...

 

[Tommo_Aus]

I've been doing some fairly rough and conservative calculations today, I'm keen to hear the opinion of others on this.

Going on what we know already, the well is flowing @ 1800 mcfg per day. Assuming this flow is the base rate (any extra is a bonus) we can conclude:

1800 mcfg x $6 (per mcfg) = $10 800/day

$10 800 x 320 (days, giving leadway for labor/downtime/possible degredation of pressure) = $3 456 000/year

Given the well cost approximately $2 600 000 it would take ~9 months to repay the drilling costs. Piping will be needed, so going on the highest estimate for piping:

1.6miles x $100 000 per inch mile = $160 000 (but I'm not sure how many inches would be needed)

This gives a total cost of ~$2.8 million from spud to a producing well with necessary product transportation implemented. Even with these figures we're looking at 10 months to recuperate initial costs, afterwards VIL would be looking at 50% of the profits. This equates to at least $5000/day, not including sales of condensate (how much would this be per barrel?).

With the remaining zones GGP would surely spud another well, in which case the necessary piping infrastructure is already in place. FP #1 is essentially a launching point for FP #2.

What I'm saying is the initial figures, even by my conservative calculations still equate to what I consider a commercial well. Is anyone willing to confirm my figures? That or mention anything I've missed/provide additional figures/constructive feedback.

EDIT: thought I'd mention I began typing this post before condog posted the previous one and didn't see his before I'd posted mine. Sort of a double up.

 

[condog]

Hey tommo im not gunna confirm or deny your cals other then say its extremely refresshing to see someone else with enough intelligence and knowledge to be putting forward a set of calcs for punters....

Well done....and they look in the ball parkish to me...

And remeber piping is a one off cost unless huge additional unexpected flows are found in which case who cares...

Two massively important thing i forgtot to say in previous post also was this in reference to the announcment......they missed this...


"The drawdown and build up process of testing the interval at various flow rates continues"
Why bother if tis a duster?????? This process is not used on confirmed dusters.....its used on wells they have a lot of faith in and wish to continue finding out a lot more about...intervals they think are still likely producers....


"It is very important to do a *****ough review in the intial testing in the initial zone of interest prior to committing to the cost of installing surface facilities and a gas pipeline...."

When i do something or say im going to do something prior to

It means im intending to do it, or am doing it unless something drastic changes...????

Even though a commericla announcment could be anywhere from a day to a few weeks away they are unlikely to walk away from this baby without significant testing of all intervasl of interest...and possibly without some significant stimulation...

 

[condog]

15 February 2010
Market Release (via electronic lodgement)
FAUSSE POINT WELL UPDATE
The Board of Golden Gate Petroleum Ltd (ASX:GGP) advises that the T.G.R. Land Company, Inc #1 well at
Fausse Point is continuing testing of the initial ten foot perforated zone of interest in the lowermost of three
identified hydrocarbon bearing formations. Production testing to date of this first zone of interest has resulted
in inconsistent flow rates of gas and condensate and testing will continue through this week as further
information is obtained and assessments are made to determine the significance of this initial zone of interest.The results obtained to date have provided further important information on the productivity of this initial
lowermost zone and the potential of the other higher intervals of interest. Flow rates from this interval will be
announced once a stabilised flow rate has been established which is expected to be later this week.
Comments
GGP Managing Director Steve Graves commented: “The working interest partners in Fausse Point are
committed to undertaking a thorough and complete analysis of results in the initial testing phase of this
zone. By extending the production testing operations into the coming week (and longer if deemed necessary)
it will provide us with additional information that will properly guide us in determining the required
infrastructure for its potential development".
As reported previously the Fausse Point well has encountered three gas and oil bearing formations starting at
7,000 ft. There have been several outstanding zones of interest across the three major formations with
indications of hydrocarbons that need to be tested.

 

[condog]

The last two announcments have made reference to "surface facilities " and "required infrastructure"......

Hmm if it was at all still considered a likely duster why are they making reference to that..... They are making reference to that because they either think it :
1. IS commercial and thus they are still testing to get a better understanding of the geology and stabilized flows
2. ITs marginally commercially viable and they are testing to determine if it is viable, but doing the sums to make sure.....

There is absolutely no doubt in my mind what soever that they think this is a duster.... that doesnt mean it will be commercial....but i am convinced the are either certain its commercial or still very hopeful........

Remember we still have 4-5 more intervals to test thaey have only perferated 1 interval for 10 ft of possible 6 "Outstanding zones"...over 500ft of interest....

The other new language is the Outstanding Zones......wow thats a big positive....

But the word "potential development" still indicates they are not or have not committed yet....

Another VERY guarded but extremely encouraging announcment IMO

The short term traders who got in friday will dump this morning and come back in on wed arvo to thursday IMO.....they wont like it they are too impatient....

The other thing changed fromt he announcment is they dropped the statement about "if the first zone proves commercial" they have replaced it with talk about "surface infrastructure" and "development costs" I see that as a massive positive, but thats just IMO....others will see that as a negative...

The inconsistent flow rates ....??? who knows.....could be fluids, could be kicks, could be psi problems ??? too early to call..

 

[gooner]

"Outstanding" as in not tested for oil and gas yet or "outstanding" as in very good potential. Not clear to me. Very poor release to be unclear.