Ann: Operations Update, page-29

Hi Mr Gates,

You need to have a reasonable net oil pay. Otherwise, its garbage. Note that the Xanadu discovery had 4.6m net pay with 15-16% porosity. That wasn't enough to make it commercial. In this case, there is no net pay recorded yet.

What is net pay:

'A reservoir or portion of a reservoir that contains economically producible hydrocarbons. The term derives from the fact that it is capable of "paying" an income. Pay is also called pay sand or pay zone. The overall interval in which pay sections occur is the gross pay; the smaller portions of the gross pay that meet local criteria for pay (such as minimum porosity, permeability and hydrocarbon saturation) are net pay'