Normally I wouldn’t reply to a post like this but there are some...

Normally I wouldn’t reply to a post like this but there are some queries which have legitimate answers to (well imho anyway):


***“Interesting possible drilling delays are now being suggested by some.
The field season in the Center is usually from about May until November.
Field workers, contractors and drillers like to have a break over Christmas.
Office based people seem to be involved with the Melbourne Cup, Chrismas Parties and have their annual leave in Jan and Feb. Meanwhile they are "Interpreting Seismic"***

A/ It’s really not uncommon for drilling crews to work several weeks with no break and public holidays have no significance. The field season of May to November is generally correct however there are numerous targets to chase which are not heavily affected from rainfall and associated flooding risks. We may lose a few weeks of the campaign from any significant rainfall, or miss out on drilling specific targets (such as Johnstone) but others are less flood prone and able to be drilled at any time of year.


***“JH has had a long history of not meeting commitments and timelines in the past.
Many may remember the BS about 10 holes to be drilled by Y/E 2008. In fact there were none!
You need to be very careful with interpreting his statements. For example when he says it will be cheaper to book a rig for Johnson it implies that one has not yet been booked.”***

A/ The rig is sitting there at Kulgera ready to go from what I’m aware? I wouldn’t have thought it’s financially astute to book it for a certain timeframe then pay to have it sitting there not being used or knowing where to mobilise it to. More rigs are also available in the market at present but whether they are suitable or not, and available in the right timeframes is anyone’s guess. Rig security/timing is a valid point and possibly one of the inherent risks.

With respect to 2007 (which is what I assume you meant) I think it’s a little unfair to blame the JH or the Board for not drilling as the previous agreements with WSP were one of the primary causes for the delay to the campaign. A few hours spent doing some research in regards to that campaign would have easily identified that and overall IMO I think we we’re pretty lucky that happened in the end.

***“Are the access roads completed? Are the sumps dug? Have the the drill pad and lay down area been completed?
Is the steel on the way?”***

A/ Similar to my post at SS in response to your same query: I think it needs to be kept in mind is that we are not dealing with long range pioneering desert exploration roads for Magee and Ooraminna like that to Blamore and Simpson, hence these accesses would not carry the same level of construction downtime nor mobilisation risk.

From a construction point of view, I can see where they are coming from by holding off. If the company was to go out in advance and build accesses then not drill the sites for 4-6 months then the maintenance costs would be an unnecessary expense. Road maintenance is no cheap exercise, you can pay up to $180 per hour for water carts, $160 p/h for a grader, and $160 p/h for a vibrating roller (which have speed restrictions of about 7kph for compaction performance) hence ongoing maintenance over say a 40km stretch of road would cost a substantial amount of money, not to mention impact from the bore supply (bores cost around $12k each to drill and pending flow rates you could have a 50,000 litre water cart there for hours).

If you had a reasonable rainfall event you may potentially lose extensive amounts of surface material and at the other end of the scale, pending the floodpath in severe catchments you may end up having half your road silted up or lose complete portions of it, hence you would then have to go back out and regrade/compact prior to drilling. It’s just a double cost risk, and it’s almost a given during the wet season.

Rig access roads in grassroots situations are built on the basis of get in and get out asap.... they are not built to be in place for extended periods of time.

With regards to steel, from last year’s campaign I’m sure they would have ample casing and would be well aware of the associated material lead times.


***“What happened to the second meeting at the end of May for the oil holes?
Remember that one? Or has everyone already forgotten.
It has not been mentioned since then.
Not one single word. Perhaps there was no meeting after all.”***

A/ I believe it was exactly the same meeting which was postponed to the end of June. Unfortunately it’s just been postponed a further 2 weeks due to the departure of Richard from QGC which is understandable.


***“All this preparation will need to be completed, and I wouldn't mind betting it hasn't even started.
It will be a nice surprise if it is underway - but don't hold your breath.
The field season is half over and it is easy for JH to say that it is better to hit the ground running next season in May”***

A/ I assume the company is well on it’s way to planning and working out the logistical side of things.

Put in perspective - I think if anyone wants to drill it would be John himself, especially considering he started the company 10 years ago. It takes time to develop a company and I think investors got the good end of the deal coming in 7 years later after majority of the work had been done.

As with any investment, in most instances I’ve found patience is rewarded and if the timeframes don’t suit ones own investment criteria there are 1200 others on the ASX to choose from.

as usual all imho only....