Ann: Independent review of permit confirms prospe, page-68

re: Ann: Independent review of permit confirm... No guidance for the SP (reason my sentiment is always blank) - I find prospecting for oil easier that figuring out the stock market. My simple philosphy is to invest in companies drilling wells with a decent shot (mostly onshore for financial reasons) and give them a drilling campaign or two to come good.

The JPR company line on flow rates is the old wells were drilled 'over balanced' and the short term flow tests (dsts) had restricted flow due to damage. I believe the issue with the NWZ-2 reentry was inability to flow to surface and therefore they are waiting for a long term test with a pump after SVA. Regardless they seem comfortable that the Jurassic sand in NWZ-2 (different zone than SVA) would flow >300 bopd on pump. To me this is still to be proven.

As an aside, the flow rate situation is similar to many tightish reservoirs who routinely take days or even weeks to reach their steady state flow rate. All the mud near the borehole which invaded the reservoir during drilling needs to be pumped away before the oil in the reservoir can flow normally. Operators today drill on balance or even underbalanced to minimize damage since the pressure detection and blow out prevention equipement is now more sophisticated.

With 'ball bearing' reservoirs like the Hutton in the Eromanga or the Flag in the Carnarvon, the well sweeps away the mud and flows 1000s of bopd in a few minutes but rocks with less porosity and less permeability need a bit more TLC to perform.