KOB.TO - East Lost Hills & GSJB joint venture Message Board

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Gold/Mining/Energy : KOB.TO - East Lost Hills & GSJB joint venture

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To: MIRU who wrote (13074)	12/6/2000 3:18:18 AM
From: grayhairs	Read Replies (1) of 15703

nostarch, I'm sorry if you feel that you need moral support as a consequence of my response(s) to your posts. My poor communication skills have obviously offended you. My apologies. <<I was not suggesting that deepening BKP#2 was a bad idea, or that a 30 day delay in production was a big deal.>> No, I didn't for a minute think that you had. My point was simply that this was another familiar example which would demonstrate that fastest is not always the bestest !! Fastest will maximize PV when all other things remain constant, but otherwise ???????? <<What I am suggesting is that the ELH reserves are so big that 10 wells at 15 mmcf/d won't produce those reserves fast enough to give us good present value of the ultimate cash flows. 30 year reserve life is for grandkids - let them find their own damned gas!>> First, although a 15 MMCF/d ELH well is indeed highly profitable, I believe it is rather pessimistic to anticipate same as the average ELH well rate. Second, I have never heard of a JV development plan that calls for only 10 wells !!!! Where did that one come from ?? Even with 640 acre spacing the field would certainly be developed with multiple wells per section, potentially 4/sec (An Upper Carneros completion, A Lower Carneros completion, An Agua completion, and a Phacoides completion). That's potentially 80 wells for a 20 section ELH pool. Third, with spacing of 160 acres, I sincerely doubt that we'd ever see 16 wells per section (16x20=320 wells @ $12MM = $3.84B) to drain the same reserve. Later, grayhairs

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