stop the rot !!, page-40

Hi Huaneng

?Bakken and Spearfish are no complete dusters and as somebody working in the E&P business I have to say they have a pretty good successrate in drilling no dry holes.?

The Bakken and Spearfish has been explored in the past. They are not exploring a completely new field.

This is a field where unconventional drilling could have been economical. What we needed from Molopo was a judgement call based on the results of the exploration i.e. how many bbls can we produce per day per well. Molopo has decided that 20bbls/day/well is an economical well. Personally I think it would be marginal at twice that flow rate if tax an acceptable internal rate of return is taken into consideration.

Producing in the Bakken and Spearfish was a very very poor management decision that should have been killed off at the executive level. From the available information it is unlikely that the Bakken and Spearfish will pay company owners a dividend.

Like I said the only people earning acceptable income from Bakken and Spearfish are whoever we are paying the royalty to. They have no significant overhead and are earning 20%.