big question to the experts on this board , page-2

Hi Moorefish,

I am not certain that the Enquest deal can be taken at face value and used to value any discovery by JKA.

According to Offshore technology . com ,"the field is currently in the decline phase and is expected to cease production in 2014. Development of the Didon North prospect is expected to boost production from the field. Didon North will be developed as a satellite to the Didon field. Production from Didon North is expected to begin in the second half of 2011.

A service refit was carried out for the FSO in 2007, which increased its service life to 2013. "


Based on the quoted daily production, the annual production is 500,000 per annum and 2P reserves are 2 million. This would imply four plus years but it appears there is a need for a refit of the FSO.

Reading the history of the field it is obviously very complex. The current water cut of 60% seems very low.

The really critical issue is the abandonment provisions in the PSC. Enquest is presumably picking up the liability. The risk is that the cost of abandonment will blow out and whilst the cost per barrel looks cheap they could easily do their shirt.