Ann: Open Briefing Clarification , page-6

Yeah I tend to agree kastin, they haven't really de-risked the prospect much at all yet over the pre-drill status.

What they have done is significantly de-risked the drilling of ST2 from an engineering standpoint, which is great but not the same thing. Especially since it took their making a dog's breakfast of ST1 to do it.

It’s also demonstrated the necessity of drilling horizontal wells when exploring this play.

Well, no - Hammamet West 2 showed the necessity of horizontal wells. All HW3 has shown so far is how NOT to drill a horizontal well in the Hammamet West structure.

I'm also rather worried with this sudden talk about not being sure whether it's primarily gas or oil. Previous indications all pointed towards live oil with a probable gas cap.

I guess the problem is that COE are trying to sell their interest so we can't really take anything they say at face value - they are naturally going to try and spruik it.

Here are the things, as I see it, that they have de-risked with this drill, as opposed to last drill:

1. Shown the 3D seismic fracture modelling appears to work effectively at locating areas of likely fractures
2. Provided very valuable data on reservoir pressure and losses for planning ST2
3. Provided better depth control that will enable them to better calculate the gross rock volume and hence narrow the uncertain range on the OIP estimate
4. Proven the reservoir is highly permeable in fracture zones
5. Shown how NOT to drill a horizontal in HW

Here are the things that this well should have done for $27M, but failed to do for $80M:

1. Proved commercial hydrocarbon flow rates through production test
2. Proved commercial hydrocarbon volumes and quantified them
3. Proved reservoir fracture connectivity
4. Shown the respective amounts of gas and oil in place
5. Proven a valid and effective horizontal well design