Very few people seem to realize that Profco is involved in another well being drilled, which has the potential to be more profitable than the Benin well. It is felt that the Benin well could easily have proven reserves of 50 million barrels, and possibility much more. One Oil Analyst is suggesting reserves in the 40-115 million barrel range, while another has suggested if all three zones are oil bearing and the flow rates are good, the reserves could reach 200 million barrels. I feel that maybe we should assume they find at least 50 million barrels. Since Profco has a 50% interest, 25 million goes to the Profco portion.
A company called Eurogas Corp. (EUG) is currently drilling in Tunisia. They are currently at 3,290 meters, and plan to go to total depth of 4,300 meters. They expect to encounter three pay zones, and expect to reach total depth by the end of December. Here is the most important part. They feel they have the potential to locate approx. 2.3 billion barrels of oil and natural gas liquids and 17 trillion cubic feet of natural gas. I did not make this up. It is in both the PSO and EUG Annual Reports. The reports also state that on the downside of the scale, they expect to find at least 719 milion barrels of oil and natural gas liquids, and 5 trillion cubic feet of natural gas. If we use the downside figures, it would mean that PSO could have at least 81 million barrels of oil (oil/gas/condensate combined) for their 6.67% interest in the well. Using both figures (remember, I am using 25 million barrels in the Benin well) the two wells could easily add $12-$15 to the Net Asset Value of Profco. Here is the best part. It could all happen by the end of 1997.
The final results for the Benin well should be known by the end of next week. The EUG well is expected to reach the first zone within 14-18 days, but we could see action within 7-10 days. This means that just as the news is out for the Benin well, interest should start start in the Tunisia well.
This could prove to be a very interesting six weeks for Profco shareholders. |
