Hi All,Posting a summary of my brief review of the Alameda...

Hi All,
Posting a summary of my brief review of the Alameda Prospect and a few other aspects for Block 9.
I have an oil & gas exploration background so hopefully my post will answer some of the queries / issues that have come up on HC threads over the last few weeks regarding Alameda-1 as well as some of a more general nature relating to Block 9.

I briefly review the following topics with back up Slides following for further explanation and references:

Alameda Prospect's Value to MAY: (Slides 1 & 2)
Significant potential value at A$0.25/S fully diluted, using a NPV of A$25/BO for the Mean volumes.
A material upside to this exists depending on the Recovery Factor - which MAY currently assumes is 5% - but if 6% is justified value moves to A$0.30/S

Alameda Prospects Risk: (Slides 3, 4 & 5)
IMO the U1 & Alameda objectives are appraising oil discoveries in the Mari-2 and Mari-5 historical wells - thus significantly reducing the risk for discoveries.
IMO the Risk assessors published Chance of Success is very low considering the two down flank wells that recovered oil from the U1 & Alameda objectives.

Recovery Factor (RF): (Slides 6, 7 & 8)
This is a critical factor for determining potential reserves & with just a slight increase can result in a material increase in volumes.

Follow-up Potential: (Slide 9)
Significant follow-up potential exists if either Alameda &/or Zapato prospects are discoveries.

Lack of discoveries in Block 9 & interest by other Companies: (Slide 10)
This has been mentioned by a number of posters with respect to that Block 9's potential may be limited or high risk - I very much disagree.
IMO the very low regional recovery factor of 5% (predominantly from fields to the west of Block 9 and due to their very low API values) would have required large structures to be defined to reach economic hurdles. The lack of adequate seismic coverage & potentially geological understanding (at the time of the earlier exploration phases) is likely to have resulted in mapped structures NOT achieving economic or risk hurdles and thus the lack of drilling within the Block.

Farmout to Sonangol being under estimated: (Slide 11)
IMO the farmout to Sonangol, with a promote, provides an excellent technical & commercial vetting of Block 9's potential.