Great Bear Tactics ???, page-9

Was recently reading up on stimulation test programs Laz and one of the analysis techniques is to seismically monitor the new stimulation well from a second close vertical well to clarify the efficacy of the frac program. It would also give much better clarity in seismic definition for sweet spot data by being able to cross reference resistivity logging data with the higher definition seismics.

Now from memory at one of the presos, didn't they already have some 3D data for this immediate Icewine acreage ?

If so they should already have the capacity to delineate THIS sweet spot and any permeability/porosity peaks via azimuthal stacking analysis. In other words they should be able to have a good capacity to define HRZ homogeneity for this IMMEDIATE acreage.

With this new well flow data they would be exceptionally close to being able to do a substantial deal on this acreage, but with obvious caveats for future infrastructure TAPs/Dalton access for any stepped acreage program to the east or west.

But getting back to forward development. As commented a while ago, this 3D data processing is now an industry wide accepted technique to generate 3D sub surface imagery of where the best sweet spot zones are located as well as the rock stress regime delineation for lateral positioning.

In other words they may already have processed this data IF they have had access to this 3D data. So for the FBP Icewine acreage they may already be most of the way to planning a horizontal production test well.

The new logging/seismic data just compiled and being analysed at this time should go much of the way to finalising such a potential lateral well.

Ice 2V is obviously not set up for such a production profile program, and the Arctic Fox rig doesn't have such lateral drilling capacity. I think DW mentioned this recently at the UK preso in response to an investors question on just this possibility. However I believe the current permit allows for a re-entry into Ice 2V for a horizontal lateral.

But it's yet another play development tactic that would require a relatively small outlay to complete an initial pilot production well at the FBP be it an internal program or a farmed out one.

This is where I find it circumstantially provoking that they stepped back from the potential to immediately follow up with a horizontal well in preference to just the lower cost verticle.

Now Im not implying anything deal-wise here. It's just a little niggle at the back of my mind, and I'm sure the JV would be mindful that this current verticle program MAY allow a decent services JV deal to be done with minimal well outlay so that the capital raised from such a deal could contribute significantly to any forward delineation programs, be it unconventional, conventional or both.

Imo any such deal would come with little to no warning, and as U mention Laz some of the deal incentive could come from a minimally sized placement to any such fund contributor rather than acreage sacrifice, or at least minimal acreage sacrifice. This has been done with the Otto/GB deal where Otto have an option to purchase more highly prospective acreage BUT at a much higher premium acreage price reflective of CURRENT highly prospective unconventional acreage deals. I think $20,000/Acre was the equivalent figure mentioned.

We wait with an interesting mix of trepidation and nervous anticipation on Ice 2V results and analysis prior to any such future developments.

d.