wheels have fallen off, page-2

Hi-tech,

With $50 oil, expensive we can deal with. Prohibitive is the killer.

I'm conflicted about Juniper. I think INP are trying to avoid the market thinking Juniper-2 failed - a DST that returned, say, three barrels of oil would not be well received. Thus, no DST. We may not even get the full core data, or we'll get something like 'Certain cored sections indicated up to 32 millidacies of permiability', without them saying how thick those zones were, or if they were the ones with the oil in them.

On the other hand, OOIP should be able to produce something.

But lets throw some numbers against a wall and see what sticks.

OK, lets assume that Juniper-X cased, completed and fracced will cost $2.5m, and that it produces a Texas-style 20 bopd - single-digit millidarcies and about 5% porosity are what I'm expecting the cores to show btw.

Lets assume the oil price stays at about USD50, and that the AUD exchange rate stays at about 0.75, so thats call it AUD70 oil.

Lets assume the oil costs a brutal A$40 to get out of the ground and truck, so thats A$3 in royalties, for a net A$37 per barrel.

At those prices, 20 bopd produces about $750 a day, so 300 production days a year is $225k a year.

Nope, we're screwed. 10 year payback.

Doubling production rates still gives five year payback.

Yeah, these are just my numbers. What I want to see are Innaminka's numbers, about how they are going to put Juniper into production.

Ian Whitchurch