I personally wouldn't get too hung up on the exact dates quoted...

I personally wouldn't get too hung up on the exact dates quoted in the research note. I agree it's a little confusing if you read the assumptions literally, but I'd rather think about the overall message, which is that in a 12 month or so time frame, this stock could be much higher if things go well. If things go badly over the same time frame, we shouldn't move too far from where we are now.

Attaining the "success" or "failure" scenario will obviously not be like flicking an on/off switch, there will be steps along the way. To get to the point of a successful drill we'll presumably see:

1) successful completion of government negotiations
2) cash payment to WHL
3) start of phase 1 3d seismic
4) analysis of seismic which could show great data not just on the first drill prospect, but also on several other targets
5) decision to shoot phase 2 3d seismic and to drill
6) cash payment to WHL
7) selection of drill target
8) drill
9) drill results

There's a good chance that any/all of this stuff will have a positive effect on sentiment/share price. Some effects would be bigger than others, but if it pans out that way, each would build on the previous (BTW I'm not ramping here, just explaining how I'd hope the news flow goes this year). What Stuart hasn't included in the "success" scenario is any other uplift there could be from La Bella data which could also be significant.

On the issue of proof-reading, I'd say the following. I used to work for a large brokerage house, and we used to have several agency brokerage relationships, on the face of it similar to that between RFC Ambrian and WHL. Any research we published was always at arms length, and the brokerage analyst was responsible for the content and assumptions, not the company. The company would fact check, but not dictate assumptions and variables. It may be that Stuart does believe the action will happen quickly. The Ophir website says he covers them too, so maybe he has a view on how quickly they work?

If you assume a lot of stuff, it might be that we can get a drill going quite quickly here:

Looking at the recent la Bella 3D, the contract was signed on 8/10, the vessel mobilised on 6/11 and the 867 sq km work was done in 34 days. Roughly 2 months start to finish.

We know that invitations to tender for the Seychelles 3D are already out, so a contract may be signed quickly, perhaps by April month end (my guess). Assuming the same 1 month lead time as La Bella, but 2 months to shoot the first 1,500 sq km there could be an unprocessed data set by late July. There is no reason to assume that the other 1,000 sq km must be shot before the decision to drill is taken, so if numbers are crunched quickly, a drill target could be selected maybe by late September/October.

In the latest Ophir presentation (from their website) the final slide says:


Funding and Rigs Secured to Deliver 2014 Programme and Beyond:

• Well funded to deliver the 2014 drilling programme (
c.US$750mn at end of September 2013)

• Proceeds from Pavilion deal (US$1.29bn(pre-tax)) will help fund future activities including new ventures and acceleration of E&A activities in the event of success

• Rigs secured for both East and West African programmes with additional slots available to rapidly target follow-on E&A opportunities


It's that last bullet point that interest me most. They have drill rigs available in East Africa with free slots to rapidly exploit opportunities. I know there is ALOT of conjecture in what I've just written, but it seems that it's possible to imagine a scenario where things move quickly. Having said that, if I were running WHL and having had the experience of missing a few deadline over the last few years, I wouldn't dream of putting any of that down on my letterhead and publishing to the market.

All the above is my speculation. Don't invest your money on it. DYOR.