Hi
@JAarThe company have not yet specifically indicated when they will start on their next high WI well.
But there is enough information to deduce that the next well in line should be the Rangers well. Had BRK had the funds , or rather, had SHE managed to raise all the funds 2.5 years ago as originally planned we would have seen Jewell already drilled and producing in mid- late 2019, with Rangers and Flames not that far behind.
The reason why Rangers should be drilled next is that BRK have applied for, and received OCC and court approval to extend the rangers DSU till Dec 2021. You have to understand the mechanics of gaining a Drilling and Spacing Unit, winning operatorship and pooling rights but essentially once the court approves a DSU, awards pooling rights and operatorship, the company has 12 months from that date to commence drilling.
The Rangers unit was court approved in December 2019 and with COVID for all intents and purposes killing drilling in Oklahoma in 2020, BRK as pretty well most operators in Oklahoma applied for and received extensions as emergency relief orders.
So BRK have till December 2020 to start the drilling of Rangers. Once drilling starts they have 12 months to complete the drilling of the well. Establishing the pad and setting the conductor classifies as commencing drilling so technically BRK can proceed to spend the $300-400 K to do that, and then wait till the second half of 2022 to get the rig on site and complete the well. Why would they do this?... lack of funds would be an obvious reason.
But lack of funds should not be a problem now with both BRK and SHE having sufficient funds to drill Jewell with cash left over. That combined with Jewell cashflow and if the respective share prices maintain or extend their recent price gains, then oppie conversions or even ( and I hate to say it) a significantly less dilutionary cap raise will ensure enough capital.
If BRK don't start drilling in December I am not sure if there is an avenue for another extension, but I doubt it as COVID will no longer/ should no longer be an economic event preventing drilling so it is unlikely they will have cause to apply for another extension. If that is the case then they will still be the majority lease holder within the DSU, and will be able to enact their individual lease extension on the leases as they expire, and apply for re-pooling. That will mean the added expense of again spending cash on releasing those leases at the same price as before, which could mean spending another ~$500,000 + dollars.
That outcome will be a waste of cash, so for that reason, I would expect BRK to at least, prepare the pad and set the drilling conductor by December 2021, and possibly even start drilling not long after that.
Apologies for the extended response but hope that helps a bit .
Cheers
Dan
(20min delay)