My understanding is rig is contracted to operator, not lease holder. And it is fairly common practice for operators to lease a rib with options to keep it longer and drill more wells if results allow for further drilling.
Rig booking is not an exact dated science. It has many dependent's but must admit, IMO SH kept in the dark with this one.
Another point of difference is that CEL TC prospect has a very high has column of course grained material. And the ellenberger is a natural crumbly and highly fractured formation.
This is different to the shale plays being compared and does not lend itself to direct comparison.
most shale plays and in particular the Petrohawk and Cheasapeake plays usually involve hundreds and thousands or millions of acre's over a usually less than 200ft average thick seam.
CEL on the other hand has a TC play which exhibits wildly different characteristic's in geological terms and 2 massive plays with have shown to be gas saturated.
What this means is that you can have multiple frac's and horizontal drills of a single well, keeps down costs and increasing production. Time will tell on this one.
Another point, with Stetson Mecury prospect, is you get the 2 formation (barnett and woodford) intersected by single vertical wells that can have fraccing or horizontals drilled from a single well and increase your production zones.
As for Mr M Much, well he is no superstar, but is an experienced guy with solid knowledge of drilling. That's what we need. Engineers and drillers, not superstars.
As for the delay's well IMO that is annoying. but to be unfortunately honest, not surprising. You do not become an operator in Texas when you by a packet of cornflakes. (that to me displays underlying confidence in their knowledge of the prospect results that us mere SH do not see.)
You must meet certain criteria which is available when you DYOR, so from my view is good SH value move, but ultimate results can only be judged after the TC testing is complete.
I was bemused by the action on Monday, and having read the ann i fail to see the major problem, other than the delay in drilling.
All else seemed solid to me. Was sent on holidays by the mods.
Oh and they did increase the TC prospect by 6500 acre's. with more to come as they stated.
Encana selling but, BHP is buying up big. ANd planning to spend big.
CEL Price at posting:
10.5¢ Sentiment: ST Buy Disclosure: Held
