Nabrajah sounds like a great find doesn't it! I also found the column heights hard to follow. Mainly because the graphics in the presentation give different numbers than when you look at the daily drilling reports (in terms of the depths of the zones tested and TD). Its fairly clear though that its big, and a UBS update last week dealing with Nabrajah among other things, intimates that a very significant reserves upgrade will follow (DNO's quarterly said an upgrade would be announced soon). Their current estimate (OSH's and UBS's) of 20mbbl was just for the 40m HC column in the Quishin formation - now we have a 250m oil column below that and another of up to 350m below that(giving a possible total of 600m), both of which flowed at higher rates than the Quishin. Conservatively taking just the 250m oil column (6 times the Quishin) the field could end up being 20mbbl for the Quishin plus 6x20mbbl = 120mbbl, for a total of 140mbbl. UBS give a valuation estimate of 29 cents/share if its a 100mbbl, so 140mbbl would be around 40 cents/share. And if the you use the 600mbbl then you can double this estimate. Of course we don't know net/gross or other quality factors of the reservoir but it did flow well!! And as I have said its on land, near infrastructure and will be in production within months!
And the fact that they point out that the prospective basement covers an area that looks to be around 25 times the area of the currently defined Nabrajah field is VERY encouraging for future discoveries as well.
I too would like to know what they mean by "closure in this area is unconstrained by mapping"??? Could mean either they haven't mapped beyond that point (and yet they have defined the extent of the basement??) or, they have mapped it and its open. Will try to find out about that on Monday.
Exciting development - and would be causing more of a stir I think if POO was not in a down trend at present. As UBS point out though if you take a long-term view any weakness represents a buying opportunity - and I agree.
H
OSH Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
