You are absolutely right with the quotes that you have posted. I would go further and postulate that the company themselves believed that they would end up with a commercial gas supply. Proof to me was their attempt to put the packer in place at the top of the HCSS and to install the production (2 3/8") tubing. Unfortunately it went pear shaped when the packer got stuck. They tried to make the best of the situation by co-flowing it back from that position, but it seems that they have decided that it will be better to drill the bloody thing out and try to clean it up (Co-mingled).
I personally think that this is the best outcome and I eagerly await the results.
I have read the Edison report a couple of times and I think that it is a comprehensive and accurate account of where the company is at the present. It does not scare me that we are where we are, I believe that we are on track to bring this together. There have been no total muck ups, there is Oil, Condensate and Gas, there in abundance (albeit yet to be confirmed with accurate flow rates). The issue of funding is the big hurdle and I note that in the Edison report that there is provision for the debt necessary to fund NWE's share of the development of the Arrowsmith field going forward. This indicates to me that the management are now focussed on this aspect of need for the provision of that capital. I acknowledge that this issue has plagued the minds of some investors, but in my opinion, they were putting the cart before the horse. It would be improper to arrange the funding for further development before proving that the resource was there and a viable extraction process proven. To me we are now very close to having proved that the American experience with Shale gas/oil/condensate is able to be replicated and is commercially viable here in Australia.
NWE has not mismanaged this development. It is just taking time ..... more time than even they anticipated.
NWE Price at posting:
1.3¢ Sentiment: Buy Disclosure: Held
