Harry,
I pretty much agree with you.FWIW,the only reason
that I was excited to hear that the upper zones
were going to be tested (about 6 weeks ago),was the
fact that I thought all of the jv's were
participating.I had a target of .40 for Adda if my
estimate of 10mmscfd was realized.That was
producing both zones(either comingled or dual
completion).(It was just my best guessimate only)
Then when Lew first mentioned farming out,I
thought it only applied to Adda(disappointing
enough at that)But what it came down to was not
expected at all.
So this is roughly where things stand as I see it
From a 8.5mill.$ well,plus 1.5mill$for completing,
plus perhaps 2mill$ (+/-)for surface equip and
salesline.So grand tot.approx 12mill$(rough est.)
But because of a lack of funds for certain of the
jv's,the benefits of this large expenditure fall
into the hands of a few.The other jv's have to wait
to receive their measly 2% until apo.
It has long been said that it takes money to make
money and it's true,as demonstrated here!
However,it's still a gamble at this point as the
zones may be weak or have h20.That is part of the
reason I would think,that one or two of the jv's
never went to any great lengths to raise funds.It
is still a gamble!-If it turns out the zones are
good,they missed out.If the zones are not economic,
they saved some more money that they couldn't
afford to lose! For sure there are no guarantees in
the patch!
I can see how working out the farming out
arrangement wouldn't have been easy.However,I also
wonder if the jv's who opted out received any cash
for their share,or if a deal was made that they
will receive some cash if the zones are economic.To
me,that would be logical.
Otherwise,ADA, PXM, and JED each get a 2% apo for their
10% working int.bpo,and THE also settles for 2% apo
with a 20% w/i.-Seems strange without some cash
involved.BWTHDIK.
My hope would be pf course that Ada and others
would receive some cash if the well is economic,
otherwise they sure gave up a lot for peanuts,
especially if it does happen to produce in the
neighbourhood of 10mmscfd...Time will tell..
It seems we're down to relying on a favourable
outcome of the lawsuit..whenever that may be.. |
