yulleroo 4, page-50

This little throw-away line is disingenuous to say the least:

"Thus how can one possibly validate the current market capitalisation particularly as the oil production (when in production) makes a margin of $10/bbl?"

If you have researched Buru (which I've no doubt you have done), I wonder if/how you managed to keep a straight face whilst typing this remark. There are many variables relating to the ultimate reserve picture at Ungani AND the ultimate production rate which the field will yield when fully on line. Your statement is spurious and does not give a truthful estimate of the ROI for this outstanding discovery. I have an opinion on just how outstanding Ungani might be but I'll not air this here.

Buru's estimate of the field's areal extent is based on sparse 2D seismic. Once the 250 square km of 3D seismic has been acquired, I'm supremely confident the reserves will be upgraded substantially. This is my opinion of course, but the current model obviously relies on a very, very conservative pool size in areal kms, probably in the region of 4 square kms. It does not require much imagination to understand the implication of a small change in the width or breadth of this field.

One further point (there are many more), the wells accessing this reservoir were exploration wells, thus the limited (constrained) flow rates of water and oil experienced during the EPT. The optimal well configuration for this reservoir will be horizontal, tracking the top of the reservoir. With this configuration water production will be minimal until it requires uplift and I would expect that such wells will produce in excess of 1000 bopd initially. Four new wells, plus changes to completion at U1 and U2 will have no trouble producing 5000 bopd in my opinion. So at this rate of production we would be looking at substantially more than the nonsense figure of $10/bbl you have suggested.

I could go on and on but I don't want to bore all those who already know this stuff. Actually, you're probably a bit bored already, eh Jtrain?

QED