minor ann. , page-7

re: jack hamar 1 & 2 delayed Just got off the phone to o/s, to clarify latest NEO announcement.
Reason for time delay in testing JH#1 is to address the issue "of all that shallow gas we were not expecting that was encountered".

This is the obvious reason for the delays in both wells and it appears to be the stone stuck in your foot that could turn out to be a diamond!!!
Looks like it has created a few headaches for all the right reasons.
The well testing program has to be redesigned properly and no one wants to rush in and stuff it up without consulting the expert engineers.
Makes sense even to an amateur such as myself.

No one knows enough about this gas yet as it was completely unanticipated. Quote "It could all be bad or all good, we don't know yet"

The way I see it, if it is no good you move onto the 6 oil zones encountered in the Monterey.

However if it is all good, Quote "with the price of gas at $7 Mcf which is 2.5 times the price it is in Oz and 1/4 of the price to drill a gas well ........" you can appreciate their reluctance to rush in and balls things up.

Now I don't want to appear to be ramping, but when you consider that the market is close, the infrastructure to market even closer. Prices at record levels. Low capex to bring to market and high margins. Insatiable demand for gas at present and unlikely to abate in the forseeable future. Well they could be sitting on one helluva $$$$ cow.
In saying that it could all be no good also!!
Move on into the Monterey then!!!

Hence the delay in JH#2 is they are designing the well program to encounter gas also in the shallower zones. They are anticipating finding shallower gas zones in JH#2.
The stevens sands play was always a secondary target and I understand it is not being redesigned around that.
It's the gas and the gas only that appears to be holding things up on all fronts.

I hope that clears up a few things for those interested.
Have a quiet Xmas but prepare yourself for hopefully a ripper start to the new year!!!!