As you haven't provided any references, ever.. I would suggest you find out the same way I did, and search geology of a salt dome and make your own assessment. There has been a tonne of research into salt dome structures as you have said, however the ability to do extensive seismic gave MAD an opportunity to potentially exploit het-lime oil pockets. Alas it was a failure, but was it not worth the attempt?
Secondly, Time is a rate. In fact, in all earthly terms (non-einsteinian) its a set rate. Production rate DECIDES the time frame. For example, MAD may be 500 years life at CURRENT RATES but if it were producing 10000 BBl/day it would be significantly less. Thus my comment about taking a tangent (a non-changing rate of reserves usage) to calculate a reserve life based in time, despite it being a function of a dynamic production rate.
Similarly, if production rate dropped to 0, reserve life as you defined would be infinite.
Thirdly, I don't care what you believe about management. They have the legal responsibility to make sure reports are correct where you have nothing to stop you lying except potential defamation.
Fouthly, Technology is not only physical equipment changes but also methodology changes. Hydraulic stimulation currently being used is far beyond what they used in the 1950's.
If you feel technology isn't important than you should look at the dozen other fields currently producing again after 20-30 years of nothing. Pensilvania - EEG has a field producing and making money which was stagnate 18 years. TTE recent acquisition of allen dome, now producing after dead wells and sold off by another company.
Fifthly, For you to suggest oil at the bottom of a pumped well is 0 shows your lack of understanding of the entire concept.
There are two reasons to pump oil out, it doesn't have ENOUGH pressure to get to surface on its own, or to extract more flow rate.
While a pump's impeller does product a vacuum (negative gauge pressure) the oil itself will not have an effective pressure of 0.
The pressure on the oil will be a function of depth and materials its incased in. The reason it doesn't flow is the differential pressure isn't high enough to over-come frictional losses associated with material incasing the oil and the journey up the well to the ground.
High porosity well sites often have to be drilled to over-come this frictional resistance.
The reserves did use 2d seismic analysis, which definetely wasn't around in the 1940's.
And while the reserves don't hang off the 3d seismic, do you think having exact locations of where oil sits vs no idea would help you find the most productive pockets?
Do you think that in the 1940's they had the ability to seek active pockets or just drill and hope?
I have no doubt the reserves are over-stated by a few %, but your saying specifically that they are over-stated by over 95%.
In fact, given that 1P is 95% probable reserves, you are stating the company that did them got it wrong by a massive margin and that you, an unknown punter on a HC forum should be believed over the documents sent to the ASX, several stock analysts, several petroleum sector analysts, a large line of investors and MAD management themselves.
Wow, I cannot believe a guru oil tycoon is sitting here in our presence...
FDM Price at posting:
59.0¢ Sentiment: None Disclosure: Not Held
