Ann: MEL Presentation - Good Oil and Gas Energy Conference, page-40

Hi Mitchdon,
Thanks for sharing your analysis. In my view, things are looking bleak at this point in time, as we are all relying on Odin to save our bacon - it is not without risk. In addition to Odin-1, I reckon the JV need to very-much focus on generating positive cash flow and fast. That would mean delivering Odin-1, abandoning the Toolachee perforations in Vali-3 (currently shut-in) and bringing on the deeper Patchawarra gas. Although since Vali-3 is only 1 km from Vali-1, which has been producing since Feb. 2023, there may be some pressure depletion in Vali-3 as a result of Vali-1 production. They could do the same at Vali-2 to get gas flowing at healthy rates from the Patchawarra and build their bank balance. Both MEL and VEN would need to raise capital if they were to try and drill their way out of trouble, which is a flawed strategy.

What Odin-1 has going for it, is that it did not need fracture stimulation; it is a conventional completion. Perforation and flow the well. When you frac a well, there is a risk that the frac. propagates into zones that may contain formation water, which then flows into the well bore and compromises gas production. Both Val-2 and Vali-3 were fracced in the Patchawarra and the leaking plug in Vali-2 caused the production problems when they brought on the Toolachee. I hope the JV are rethinking their dual completion (with sliding sleeve) strategy as it appears to be failing them.

All in my humble opinion of cause.

I am hoping for another announcement before weeks end which informs the market that Odin-1 is producing gas into the network.............Also remember, when they talk about 6.5mmscf/d on test at Odin-1, take out the CO₂ (22%) gives us 4.8mmscf/d of hydrocarbon gas. System backpressure may then drop this volume to 4mmscf/d or less of saleable gas. Very sobering stuff this.

Kind regards OldGeo