Bitzer, I was over exaggerating my argument but feel free to nitpick.
Obviously you cant just drill a well and start pumping these days. That's not how shale works. It is not a conventional play.
But 3 years has just gone down the toilet for a 'data collection' experiment that could have been completed in a year given enough focus and foresight.
I don't care what result they get from vertical fraccing each layer, you can pick whatever multiplier you like from the data they collect, it doesn't mean ANYTHING until they actually frac a layer horizontally and bring a field into operation that you discover the true potential.
Management have completely dropped the ball and lost focus since they extracted a beaker worth of oil from the K layer. They are conducting this operation as if they were Bharat and AWE (obviously they have been influenced as such), but that is a luxury they cannot afford. They are a penny dreadful, and must begin operating and acting as such. THEY are the operator, and they should use this to their advantage. GET THE RESULT THEY NEED AS SOON AS POSSIBLE.
What is the result they need? This is where management, and some of you still fail to identify the main issue through your rose tinted glasses.
They need to collect data from test wells and prove that the Perth basin is a commercial resource?
WRONG. This is the strategy BHP, Woodside etc can employ. NWE need to focus on adding to their market cap, so that they can raise money and continue their operation to eventually become a producer.
How can they do that? Horizontal frac a layer asap.
1965 - The C layer flowed 4MMscf/d unsimulated from A-1 (400m from A-2)
2010 - AWE announced the C layer had potential for 13-20TCF of gas.
That is your data, it was done by 1965.
A-2 should have been, drill the well, find the C layer. Frac it vertically. Frac it horizontally. Frac the others while you wait to arrange horizontal fraccing for the C layer (if there is time).
The C layer is and has always been the most promising layer.
The flow rate from a horizontal well should be the only piece of data needed.
If management have finally figured this out, then they can stay. Otherwise someone needs to replace them.
At the current rate of progress, NWE will either be non-existent or so diluted you probably won't even break even.
I'll admit, this argument has the advantage of hindsight. But you can look back if you like to older posts of mine during K layer testing when I stated it was all a colossal waste of time and shareholders money to behave like a Bharat/AWE Science team.
NWE Price at posting:
1.3¢ Sentiment: LT Buy Disclosure: Held
