*** zackariah ***

A prophesy from Zackariah (circa Aug/Sep 2003) .... this guy was/is better than Benny Hinn

"Tiof: Another salt dome but in a different sand fairway. Finding oil (NOT GAS) here would prove that the Chinguetti play works in other blocks, and could really add some value to other prospects."
****************************************
This quote came from Zac's post pre 2003 drilling season
and here is the rest of the post ......
****************************************
"OK, so what are the risks / rewards in this drilling phase (don’t read any further Enigma – I am about to do it to 1000 deaths):

Chinguetti EDW: Needs to flow at >10,000(?) bopd to demonstrate an economic project. Although WPL and HDR talk as though development of Chinguetti is a certainty, ROC’s John Doran has been categorical in saying that this well needs to succeed before the partners (and especially HDR’s project financiers!) will commit.

Success Case: A 5-digit flowrate should certainly get the sp into the 80’s. I think predictions of $1+ are too optimistic based on the value of Chinguetti alone. Investors (as opposed to traders) will need to see more oil (not gas+some oil) discoveries before valuing Hardman at half a billion dollars.

Failure Case: This would be something like much poorer reservoir than anticipated or sand production problems not solved by whatever completion is being planned for the EDW – something that forces the partners to totally rethink the development concept, economics, and timing. This would be a disaster for the HDR share price. Sub-40 very quickly I would think.

Risk Level: Hope like crazy it’s low. We have to trust that Woodside know what they’re doing and that they have so much data from the seismic and the three previous holes that this well is pretty much a tick-the-box formality to convince banks and investment committees. But in this business the unthinkable can still happen.


Tiof: Another salt dome but in a different sand fairway. Finding oil (NOT GAS) here would prove that the Chinguetti play works in other blocks, and could really add some value to other prospects.

Success Case: Assuming no disaster at Ching-4-5, this might be the spur to get HDR re-rated, just as Banda would have done last year. SP over $1 on a good result.

Failure Case: The market would (rightly) ask itself whether Chinguetti might just be a one-off, unlikely as that seemed in the euphoria of two years ago. For a parallel, look at Cliffhead – one first-up success then three dry holes and no obvious follow-ups. SP back to the 50’s or even 40’s despite a prior success at Ching-4-5?

Risk Level: Toss of the coin? Remember that Hardman was calling Thon “low risk” last year.


Poune (contingent): Not much information out on this one. Ellyard calls this the “highest-rated Cretaceous prospect” (does this mean highest rated after Thon Ted?). But could add as much or even more value than a Tiof success if it proved that Cretaceous plays were still in the game despite the failures at Courbine and Thon.

Success Case: In principle similar to Tiof. But if it comes in straight after a Tiof success, rampant speculation on HDR might get going again and who knows where the SP would end.

Failure Case: If Tiof succeeds then a Poune failure might see the SP retrace to pre-Tiof levels (at which it could be a pretty good buy). Failure at both Tiof & Poune would see it trashed.

Risk Level: Another toss of the coin, but probably higher risk than Tiof.


Teve’t (contingent, alternative to Poune): This is the “bump” between Chinguetti and Banda seen on some of the published seismic. Given it’s in the same fairway, it should be lower risk than Poune or Tiof, but probably significantly smaller or they would have drilled it last year. But if Chinguetti goes to development Teve’t could probably be tied in pretty economically.

Success Case: A nice boost to the SP but not a re-rating.

Failure Case: Coming after success at Ching and Tiof, failure at Teve’t shouldn’t be a huge dent. If Ching succeeds but Tiof and Teve’t fail it’s back to the 40’s. If Ching fails then Teve’t won’t get drilled.

Risk Level: Significantly lower risk than Tiof or Poune, but also lower reward.


Pelican (firm, Dana Block 7): This season’s rank wildcat, in 1700m of water. Would prove up a petroleum system in a completely different part of the acreage.

Success Case: As much or more impact than Tiof or Poune. If it came on top of success at Ching and at least one of those other two = whoohoo

Failure Case: All depends on what has succeeded in the preceding 2 or 3 holes. However a failure might puncture any speculative bubble built up on good prior results (just like Courbine did back in 2001)

Risk Level: Significantly higher risk than Tiof or Poune. Remember, Woodside had the chance to participate in this one (50% cost for 35% share) but dropped out after shooting the 3-D seismic. Only an outside chance in my view."
************************************
Sailorgirl comments ..........

Yes, we proved Chinguetti's commerciality, but, Tiof turned out to be a big surprise. Really got Woodside interested.
And, Tiof is, but a dot, on the saltdome landscape in OLI PROVINCE Mauritania.

I can sniff $5-10.
sniff sniff ...