These wells are going very well. As at 1 September 28H was drilling ahead looking to contect to the Bibblewindi 29 vertical production well. It successfully did this on the 15 September and is now undergoing readiness and production operations.
Also as of the 15 September, 21H is drilling ahead to contect to Bibblewindi 27. Progress has been good and we should meet the reserve taget.
These lateral wells are necessary to properly draw down on the vertically fractured coals and aid water reduction. The initial strong water rates are important because they indicate pleanty of gas and that the wells have properly connected with the reservoir.
Fundamentals seem unchanged. The recent sell down to 94c seems to just be technical movement to the lower resistance line of the chanel it has been in for the past 10 months. It has so far bounced from this line about three times already.
There is also the quality of the reservoir, commerical LNG possibilites and Santos backing at $1.00+.
I think this is a buy at these levels. Both technically and fundamentally. So long as drilling progress continues to go smoothly this should continue to move up.
ESG Price at posting:
94.0¢ Sentiment: Buy Disclosure: Held
