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

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To: JL who wrote (1157)12/20/1998 4:03:00 PM
From: grayhairs  Read Replies (1) of 15703
 
JL,

....the size of the flare(edited) is NOT indicative of the size of the reservoir. It IS indicative of the pressure or flow rate.

Your statement is correct. Flow rates indicate productivity, NOT reserves.

Published estimates of the gas flare rate before the onset of water production were 100-130 MMCF/d, which is very prolific production. All larger rumored rates, IMHOO, lack credibility.

Comments have been made that the gas flare rate was steady (or even increasing slightly) prior to the onset of water production. This is very encouraging and IF the statement is true would infer a gas reserve of at least ~30 BCF, IMHOO. But, since the flare rates were only estimated by visual observations of flare dimensions (under potentially variable wind conditions), you must appreciate that such rate estimates can only be "ballpark" and are quite subjective. To conclude that there was no decline in flare rate, based upon such observations, and to conclude therefrom that the gas reserve is at least ~30 BCF would indeed be quite risky.

The most recently "measured" gas rate, with very large volumes of water\hydrocarbon liquids now being produced, has declined to only about 40 MMCF/d only. Does this apparent reduction in gas rate imply a depletion of the gas reserves ?? Absolutely not. The reduction in gas rate can be attributed entirely to the onset of some pretty serious water production, 18,000 bbls/day !!!! To conclude that the reservoir is limited in areal extent simply because the gas rate has declined would be an error in logic.

The term "a lot" and other such quantitative terms tossed about by media types, particularly, are very poor measurements AT BEST. At worst they're deceptive.

Yes, of course. Non-quantifying terms like "a lot" compare to other non-descriptive terms such as "over-pressured" and "relatively limited". They communicate poorly and make it difficult to evaluate messages for credibility.

How likely is it that a single well has tapped into a reservoir of this magnitude without consideration to any other zones in the formation?

I'd have to answer this question with meaningless, non-quantifying, and poorly communicating terms as I have no idea as to how likely it is !! :-) :-) :-)

I can however say that it is not difficult to project reserves in excess of your 100 BCF threshold satisfaction level for the ELH #1 well.

Later,
grayhairs
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