oil & gas found, page-19

I think for apples to apples comparison they should treat oil and gas completely separately when announcing well results.

400+ BPD of oil per well would be a nice result to repeat. We had a few dry holes in the Apr-Jun quarter so far and a few nice holes too but not enough yet IMO to have a great quarterly.

I think they might have included gas this time on the Ann because we could be coming up to a pretty ordinary quarterly production result. This new well Ann might be a sweetner to lift spirits on the future outlook for US Gulf oil production sentiment IMO.

My reading of texas oil data in recent nights of research is that at this stage for the last quarter well decline may actually equal new well production (this number is subject to as yet unrealeased June drilling results and tardy/late w-2's for may holes). I think a flat or slightly down quarterly average daily production result is likely unless they had a real push in June to do lots of recompletions and new holes. The trouble with compressing the completions and flow tests to late june is that it just lifts the headline rate for June 30 rather than help the quarterly average (the important number for revenue). Luckily oil price was pretty good and is in Linc favour this recent quarter compared to previous.

I think gross production at some quarterly/annual cutover date is a pretty dumb number to care about given the rapid decline in gulf coast wells - I wish they would just focus on quarterly average daily production in the announcements, that should be the KPI not the peak exit rate on any single day and definitely not adding the equivalent gas energy to oil production numbers.

Having said that - any imbalance in cheap gas and expensive oil price should equalise fairly quickly (within a year or two) and if it does not then there is an opportunity for GTL to turn that gas into diesel etc and gain a big margin lift if you have the expertise in GTL :)