Agree should have switched to water muds earlier. Though no guarantee there would have been oil shows. All we know is the abiod was penetrated 40m before estimated.
Like you said fractures are complicated. No doubt multiple fractures were intersected however they did not bear oil, may have encountered water or were just close. Regardless not encouraging for the vertical.
Horizontal will intersect more structures, so the hope is oil has migrated to these. Really need the swabbing to highlight some oil along the column, else to me it doesnt look good.
Cash is very tight, my estimates are this well will cost > $40m which is a BIG blow out. JKA may have enough cash but there running very tight. So cash will need to be raised regardless of outcome (unless they do an asset sale). Personally i would prefer a sale of the Nigerian assets for 15+m instead of a raising at these prices.
Anyway heres to hoping the horizontal comes up trumps, next week hope they start drilling it.
JKA Price at posting:
7.6¢ Sentiment: Buy Disclosure: Held
