re: just curious. agent.agree your diffidence abou
arttse,
......"Once Nido outlines their exploration program to a rig operator they will bend backwards to assist. We are not talking about 2-5 wells been drilled...Nido will be targeting close to 20-25 wells.".....
62Strat,
i will spell it out for you...
1. Galoc - 2 to 3 wells 2. West Linapacan A - 2 wells 3. West Linapacan B - 2 to 3 wells 4. Coron North - 2 wells 5. SC54 - 5 to 6 wells 6. SC58 - 4 to 5 wells 7. Area 1 - 3 to 4 wells
total = 20 - 25 wells".....
Arttse, it seems that you are confused about exploration wells and development wells as you have dumped them in the same basket. There is a big difference, particularly in the cost of a whole package! 6 to 8 wells of the above are development wells.
...."The above drilling program will commence in August 2007 and continue into 2008."
Arttse, the only wells we know about for sure and that we have a timetable for are the Galoc wells, (even this timetable has been altered, and could be again!).
Let me do a few basic figures for you....
Lets assume that Nido will do 20 exploration wells.... Average drill time for a standard construction 2,500mtr exploration well to cut-off plug and abandon is 21 days, at an average day rate cost (all inclusive) of USD$350K, or USD$7.35 million for the well. (You may be able to take the day rate down to 300K by factoring in cheaper Philipino labour).
X 20 = 420 days of well construction at a total cost of USD$147 million (AUD$192m).
420 days does not include any down time or extended time for whatever reasons, including typhoons or testing of a well if they get lucky. It also does not allow for any tow/sail and positioning time between wells.
Now, of the cost of USD$147m, lets assume Nido only has to pay 22.279% on all of the 20 exp wells (but we know that won't be the case in SC54, SC58 and Area 1). This represents to Nido alone a cost of USD$32.75m (AUD$42.77m), again, with a straight run of drill cut plug and abandon - ie nothing found. Anything found will take longer and cost extra, although it will be very good for the sp.
West Linapacan. You talk about it like Nido are the only interest. Drilling at WL cannot go ahead until a JV Development team is formed. On this count you might remember telling me earlier this year that you had been searching for the JV Operator for WL for over a year without any success. Nido was playing it close to the chest and not giving anything away you said! For those not aware, WL comprises the following holdings....
Oriental Petroleum & Minerals Corporation...... 30.288% The Philodrill Corporation ............................25.588% Nido Petroleum ........................................22.279% Forum Energy Philippines Corp. .....................9.103% Alcorn Gold Resources & Mineral Corp. ............6.123% PetroEnergy Resources Corporation ................4.137% Phoenix Energy Corporation ...........................2.482%
As far as I'm aware, drilling at WL A and B will be development drilling once a JV Development team is formed and a well system is designed and planned, much the same thing as Galoc. The WL C prospect will require exploration drilling, again, with a JV team.
SC54. Holdings, 60% Nido and 40% Yilgarn. You have 7 wells minimum and 8 wells max listed for drilling (incl Coron Nth, which has the same parties holding the same percentages as WL, and therefore requires a JV Development team). So, without Coron North, you have 5 wells min and 6 wells max. Notwithstanding the NDO/YGL cost sharing arrangement for the first hole drilled in SC54, lets just look at the cost of the 5 wells minimum you have outlined for commencing end 2007 going into 2008.
5 x USD$7.35m x 60% = USD$22.05m (AUD$28.8m) for NDO, and.... 5 x USD$7.35m x 40% = USD$14.7m (AUD$19.2m) for YGL.
SC58 and Area 1 7 to 9 wells (Nido 50%). 7 x USD$7.35m x 50% = USD$25.725 (AUD$33.6m)
Without even considering Galoc, West Linapacan or Coron North, the cost to Nido for your minimum 12 exp wells in SC54, SC58 and Area 1 combined will be USD$47.775m (AUD$62.4m)!
Arttse, where's all this money coming from?..... Ahhh, a super major JV partner I hear you say, whom I suppose will be announced next month seeing as we'll only be 8mths away from the start of this massive drilling campaign!
And this brings me back to....
...."Once Nido outlines their exploration program to a rig operator they will bend backwards to assist. We are not talking about 2-5 wells been drilled...Nido will be targeting close to 20-25 wells.".....
So, the rig operator has not yet been informed of this massive drilling campaign?! If I recall correctly, I think in one of your other posts you mentioned something along the lines of "do you think once the rig has finished drilling Galoc it will leave the Philippines?" Your implication was that it was going to hang around and be available for this massive exploration program.
Your probably right, it probably will not leave the area as there is bound to be other work outside of Galoc with other oilers for which it has more than likely already been contracted, but not necessarily. Only one thing is definite here, it will already have another contract booked (worldwide phenomena for any operational rig), but whether in the Philippines or elsewhere, I cannot say (Riglogix could tell you if you subscribed, or Jet Drilling, if you knew somebody there).
Here's a little scenario for you....
The drillship "Energy Searcher" is currently drilling wells for Petronas Carigali in Malaysia (true up to here), and that development contract is due to be completed in May/June 2007. The next contract on the book for the Energy Searcher is due to commence June/July 2007 with the Galoc Production Company in the Philippines, for which they are going to drill the Galoc development wells.
About this time the CEO of Petronas Carigali decides that he's going to keep the rig on to drill 20 exploration wells that the company has been busy planning for the last 48 months. He knows that once he outlines this plan to the rig owners, they'll bend over backwards to help him out. He has no doubt that they'll leave the rig working for him, and that they'll ring the Galoc Production Company and let them know that the Energy Searcher will be delayed for about 450 days!
Arttse, as I said before, I'm not arguing about the work program that will eventually unfold, only the timing you are putting forward. Your posts infer that these wells are going to be completed one after the other in a year or a little over. This is so NOT going to be the case.
...."plus...they will also drill several yet to be announced ROD fields"....
Arttse, I'm not even going to go here, save to put forward a thought provocation. Do Nido need to acquire and develop ROD fields, or can they just sell themselves as planners/managers/consultants/advisers or whatever to the technique? Anyone elses thoughts on this appreciated.
NDO Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
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