STX 2.56% 20.0¢ strike energy limited

Sept. update, page-39

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    I don't entirely understand the mechanism but it's something to do with pressure drop across the fracture interface when they start flowing back. It may be something to do with the incompressibility of water. There is also the fact that a frac is physically breaking apart the coal, which will release some gas.

    I talked to a frac engineer about it a while ago and he wasn't surprised that there were immediate minor gas shows from an undersaturated coal. If I bump into him again I will ask for more info.

    No doubt they were salivating when they saw the initial flow results, but it should have become apparent very quickly that those results were transient and highly likely to be related to the frac flowback.
 
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