2008 - a rights issue review, page-3

Stuverine..... we are all disappointed that things grind along so slowly and that NEO / and now QPN cannot seem to shake off a level of "bad luck" that continues to plague them.

While it is easy to foist the blame for the "bad luck" onto management there are things that had they gone the other way would have seen QPN bobbing along quite merrily by now.

(1) I am not sure, without digging back, that Bullseye was actually in the picture at the beginning of the Rights issue.
I think it was suddenly announced as a 6.5% W.I. (5% farmin) after the issue had closed.

(2)and (3) GH #1 and North Kettleman #1 still have not taken place. And the reason for that can be seen in the recent announcement I would suggest.
The change to having Nations as the 50% SJJV partner will hopefully see these prospects tackled sooner rather just drifting.
Somehow NEG just did not have the energy ! Or perhaps the acceptance within the industry ??????

(4) The acreage rentals do present a bind when you do not have the cashflow or financial strength from having stronger producing assets or the capital credibility that such assets can create.

(5) SELH.....yes one of those "bad luck" situations. But still not completely lost if some new wells can be put into place to test other zones as indicated by Solimar.


Honesty ? Integrity ? Hmmmmm. Let's face it the oil exploration game does depend on "possibilities". It is a gamble that when you put the drill bit into the ground that at the desired depth you are going to get an even better result than you hope for. You are always hopeful that your toss of the dice on this well is going to be a winner.

Now QPN, even though it had a toss of dice on Bullseye and has got results in two wells, it hasn't been withoput its share of disappointments and difficults in getting there. And in getting there it has cost a heck of a lot more that desired or anticipated.

Yes the difficult wells were successful. But both wells struck costly problems. There were delays caused by the problems and also hurricanes.

I hope that California will come back into the picture now but the funds situation is difficult and we really need to get a good estimate of the size of the Miogyp reservoir so that gives the sp a boost.
Also if there could be an announcement soonish about a sidetrack of the Acosta#1 well to get into the Miogyp then that would help things along.