bargain buy, page-23

The sudden flurry of announcements, presentations and flag waving to dignitaries in the last few days leaves me puzzled. Is there some higher purpose? We have already had a public steam-up some weeks ago. Nobody has seen steam coming out of a flue before? (Nearly all TV footage of supposedly pollution billowing from tall chimneys is in fact beautifully clean white clouds of water droplets.)

A number of scenarios can be envisaged.

a) Cover up the poor permeability figures. (Remember the advice given for presenters and lecturers: When in doubt about some aspect, talk loudly!) But see further comment below.

b) Generate good publicity by getting Leading Public figures to make supportive statements at a particular time when PAX might be hoping to achieve a favourable closure on a JV arrangement.

c) Gaining public exposure for the benefits of the Resource Rent Tax that should help the geothermal industry to a high degree. PAX is presently a lone voice in taking a public stand in favour of the tax.

d) The Antara News agency has just published some positive statements on the recent PAX Penola successes. Perhaps PAX needed to engineer these in order to expedite the normally slow approval processes of the Indonesian bureaucracy for the Sumatran project.

e) Attempt to lift the SP in preparation for a further fund raising to pay for SAL 2 in 2H, not immediately but they look ahead and want to remain cashed up.

BdeG seems to have made quite a number public relations statements in the last few days. It is hard to tell whether news agencies have just rewritten the ASX anns or had actual further discussion with PAX.

The 'most likely transmittivity' of 6.7 D.m around SAL 1 is only 12% of the Ladbroke Grove-1 well at 58 D.m, just 5 km away to the N.W. There are sandstones and sandstones of course and the permeability will be a function of the original compaction, grain size and shape, etc. Some of these processes are a bit random. I suspect that when staff first saw the preliminary figures they couldn't believe it. "It must be the filter cake still stuck on! We've got to do another clean up." Since the numerical values were clearly stated it is unlikely they will now change much. The CEO of another geothermal company told me last year that he thought the expected permeability figures were too high. It is interesting that the precise location of SAL 1 has not appeared on a map before. All the comparative reference data was from a group of wells all on one side to N.W. of SAL 1 which might also help to explain the discrepancy withexpectations.


The systematic approach of PAX is clearly evident again as with the new modelled temperature data the SAL 2 location is swung in the diametrically opposite direction from the original N.W. New information implies modified idea. I love the contour diagrams. You can make your own estimates. The temperature should increase about two contour intervals (10 C) to the S.E. Will the flow rates increase or decrease in this direction? Note further that the separation of the two wells will be 4km which, if it works, is a very low well to area ratio.

Guild. If a JV partner still has any reservations then they could well want see SAL 2 results. If these are good then they would have to pay a significantly higher entry price.

This post is a bit later than intended. A friend needed help unexpectedly.

Juke