Db...what you are essentially saying (forgive me if I have wrongly interpreted you), is that you came to appreciate that the remaining risk on the play was beyond your appetite and/or comfort zone and that you chose to address this by lightening your exposure. I assume that buying back in 15% lower has reset your risk/reward equation back into your comfort zone? If so, well done. I guess that is what the entire 'market has been doing' over the last few weeks....re-adjusting their risk/reward profile if they see a need or justification for it.
I am one of the majority who have not seen anything in the announcements to give me cause to do so. Only time can fully judge that decision.
My interpretation of your question posed is that the petro-physical model is a , well...model....and as such gets modified with data uncovered during the exploration/appraisal process. They got trace hydrocarbons much earlier than the 30% of flowback that their model initially suggested. Is that good or bad or just different? They pumped in 28,000 bbls (apparently) of frac juice and got an average return rate of around 300 bbls/day over the first 2 weeks (i.e 15% cumulative return), but at an exponentially declining rate. Is this good or bad or just a tell for engineering strategy? The fluids in the fracked zones were co-mingling prior to the date planned. Is this good or bad or just different? And has this had an impact on what was observed with the pressure drop?
The model was based on indicative information gained prior to the stimulation, and drawing hypotheses from elements of implied analogues with other known successful and failed shale plays. If one expected the 'model' to be 100% definitive, then I would submit they did not understand the level of risk (50%) that existed prior to Ice2. Indeed Db, correct me if I am wrong, but weren't you one of those who regularly posted prior to spud that you could not understand the 50/50 risk and thought it was more favourable in reality? We are witnessing why it was set at 50%. Nothing has happened, IMO, to change that 50% figure just yet - either up or down. But it is clear that many realise that it actually is 50% and that is higher than what they allowed themselves to believe and accept. The rest realise it is still 50% and settle down to wait.
I may be totally wrong. GLTA.
88E Price at posting:
3.0¢ Sentiment: Buy Disclosure: Held
(20min delay)
