Oil exploration is a numbers game . Each project would be assessed by imputing many factors including the chance of geological success , the probable size of the resource , the cost of discovery and development , the fiscal regime and country risk and lots of other things . So if a well has a low COS it does not necessarily mean it is not worth drilling and if it has a high COS does not mean the project may not be passed over . I don't know where the 20% came from but Beehive may still be attractive to STO / Total because of the weight of other factors , it is a very big structure . 3D has de risked the geological chance of success to some extent in exploration but it is far from definitive as seen in SM74 where BYE / MEL only found residual oil .
I don't know how anyone could put a chance on a drilling go ahead by STO / Total , it very much depends on the 3D seismic . They have not spent $5 M without thinking there was a chance to get a drillable prospect .
I doubt they would give a COS if a drilling go ahead was given although they could give some commentary on the 3D that might give some insight . There is always buying and selling in wildcat drills and often the SP weakens a bit during the drilling but what is for certain a big discovery would be huge for MAY with or without a TO of MEL .
We wait developments , we will soon know more .
MEL Price at posting:
4.8¢ Sentiment: Hold Disclosure: Held
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