another great discovery another bad communica, page-77

The answer is fairly straight-fwd, Bob.

They need to drill a commitment well in WA-314P till Aug2014. Hence the need to farmout & drill Grace. And then another well by Feb2015 (prolly Elvie-1, if the 3Dseis looks good).

Those r the terms under which the tenure has been extended. Pls dont tell me you cant find them on the Net.

U need to understand that,
1) once a permit is granted for 5 years &
2) an operator needs to demonstrate sufficient funds to commit to desktop studies, geotech, seismics
3) eventually preparing a drill ready target to drill,
4) for which if they have funds they can go solo, if not
5) then farmout to save cash-burn.
6) If successful with drilling, then they can extend the tenure of the permit,
7) if not, then relinquish it.

That's how the sector operates here.

Looked up the fleet status of 4-5 Rig operators currently in Oz (Maersk, Diamond, Transoc, etc), cant find KAR's name on any. So, we could still end up with the Legend as the hire period is valid till Feb'14 with a minor shutdown period.

Now, with Prot-ST2, they may opt to take sidewall cores to understand what sort of resrvr they r dealing with.

Remember they stuffed around with cutting cores at Pos#2 & couldn't flow the Montara due to the skin-factor etc etc.

So, lesson learnt frm that experience by Conoco, complete logging, set a liner & do a flowtest, e.g Boreas-1.

After logging, they'll need to run a production liner over this interval & do the perforation etc in preparation for the testing.

cheers