Difference Between Conventional and Unconventional Thanks to...

Difference Between Conventional and Unconventional

Thanks to PHS. BTW for that primer !

Be careful tho re your mindset atm. As Lazarus points out there is still aways to go before we MIGHT see oil flow from Ice 2H. So MEASURED positivity might be a little bit better way to be atm.

I might fill in some basics that these items so often forget as it seems 88E anmnts take for granted investor knowledge, probably THE only area they could perhaps improve. HOWEVER then a lot of what they would be anncing wouldn't be hints any more !!!

Conventional V's Unconventional.

Quite simple really:

Conventional is just that, the conventional way to drill an OIL POOL is to drill vertically into that well and pump the oil out with various methods.

Unconventional is again just that, the techniques they use to extract the oil are entirely unconventional in that they drill sideways and then CRACK the formation as well as INJECT particles to keep the cracks open as well as use friction reducing fluids. Not much conventional about that !!!

Generally the reason behind this is that the oil is TIGHTLY held within the rocks pore spaces and hence requires the UNCONVENTIONAL techniques.

However 88E's may not be quite so tightly held !!!


"And also their announcements have said it's behaving more like conventional resource but still using unconventional everywhere"

THIS IS THE KEY to why we might just see much better IRR figures IF financial assumptions are made that take into account THIS seeming characteristic of the HRZ zone.

IF the oil in place flows as well as the company thinks it might then the RECOVERABILITY will be that much more. Better recoverability gives better well efficiencies and economics.

You will never extract all the Gas Condensates and TLO's from these zones BUT I have no doubt Paul Basinski will try IF his modelling on the FLOWABILITY of this zone is correct and the recent advances in unconventional extraction will make that aim a little easier.

This flowability in fact allow them to increase the certainty factor of the recoverability of the oil in place!!!

Is unconventional a bad thing ?

I'll leave this thought with You on this.

ConocoPhillips have stated an aim over the near to mid term is to reduce dependence on deep sea exploration and increase cheaper break even on-shore reserves due to the flexibility of production alteration as well as much lower day on day operating costs once the well has been completed.

A BAD thing ?

Me thinks not !!!

d.