over a whisky

Morming all

Nothing like a spot or two in the evening to clear the mind.

There is one thing that has been obvious for quite a while and that is they are in no hurry to get the oil out of SRH 1 and 2. Yet these two are above average and may be well above average .

Instead we have the two average wells on production and the best two more or less shut in. Production from our permian wells has averaged 53 Boepd for the quarter so they are not producing much during testing.

If you were a small company with not a lot of cash would you be hanging around spending up large and not getting any income from it and if so why.

The failled deal with Terrace gives us the clue, we expect to have the cost of these wells paid for in any JV arrangement and share the income. In other words free carried.

JV talks were well advanced in the last update so one would expect any JV partner who was going to include our existing wells in the deal would expect most of the oil to still be there.

Add to that the previous update stated we are still in talks regarding land in the area so they would be in no hurry to disclose any more than they have to, in this respect the JV talks would be helpfull.

So to summarize a small company does not spend extra cash and deprive itself of income without good reason. Going by the terrace arrangement JV talks have been going on with various parties from at least the start of Feb.

These talks and what we found in our first two wells will be dictating our present course IMO and hopefully we will know before the Month ends.

Ifs not a fast process unfortunately but like a good cheese or Whiskey for that matter it gets better over time.

I was supprised by the amount of cash left and the low production but I love the underlying reasons I believe is behind it, I expect the money spent to be returned with interest and the income although it may be shared will be ahead of us.

Very exciting times ahead of us IMO.

Cheers Whisky