.

No one is going to be pleased to see gas that's a cert, proselenes can dress it up all he likes, but anything other than oil, the SP will tank.

cynic takes his monacle to extremes, needs to take an optimist pill or 10..

Or better still sell his imaginary holding...lol

GB - not calling me a liar i hope, for that would be unbelievably stupid of you ..... but why do i need to take an "optimist pill"? ....... the pair of you can burble on as much as you like, rather as did mr micawber ..... my own call on this stock, as i have previously posted, is to sell most before the result - i.e. when, with luck, all the lemmings are leaping on board in blind hope ..... if it means taking a loss because the market persists in refusing to believe unproven hype, i am also perfectly prepared to do that

I'm with chuckles. The market wants oil. In the short term, anything else will see the sp tumble.

Wait and see. The SP will fly on a large gas find.

South Falklands only needs to be 5 TCF recoverable to be commercial - anything over that makes tonnes of money. T1 and T1 deep have the potential to be 12 TCF recoverable.

Edison develop gas, as does Noble - why do you think these 2 are farming into FOGL - lots of lovely gas and possibly lots of lovely oil as well.

If T1 and T1 deep are gas, watch the SP fly upwards....... and I will, at that time - remind the derampers for the next 10 years of the lies they are spouting now about gas not being good - mark my words - just need a big gas discovery at T1 and T1 deep. Not long to wait.


chuckles - 17 Aug 2012 13:43 - 1273 of 1275
No one is going to be pleased to see gas that's a cert, proselenes can dress it up all he likes, but anything other than oil, the SP will tank.

Think you might find the major shareholder in here talking about 4.7 Billion BOE

http://en.wikipedia.org/wiki/Barrel_of_oil_equivalent

Errrrr GAS - its GAS..........

http://www.rns-pdf.londonstockexchange.com/rns/2106K_-2012-8-16.pdf


You might find Edison talk about 4.7 BBOE (4.7 Billion BOE).

Loligo could be 25 TCF to 30 TCF recoverable, or might be a mix of gas circa 12 TCF and oil of a couple of billion barrels.

Anyone with a brain knows that Loligo is likely a mix of gas and oil, which is why everyone talks in BOE - everyone is expecting gas, apart from some muppets on bulletin boards trying to make out gas is bad news................ LOL.

Yes for BOR, they were drilling tiddly targets and so uncommercial if not oil. FOGL are drilling targets big enough to be commercial on gas, and oil ! :)

Proselenes - I think it fair to say that your bb persona leaves something to be desired.

I could resort to calling you a muppet interspersed with lots of 'lols' but I don't really see the point and why would I want to lower myself to your ignorant level?

if you want to believe a gas find will be seen as a success, then carry on ramping.

BTW, it doesn't matter how big the targets are, if they don't find anything (or gas) then it won't matter how big it is - mustn't forget and lol

chuckles, FOGL are targeting gas at Loligo, with perhaps some oil thrown in. Edison SPA (EDF) know that, they farmed into FOGL, they develop gas.

Every broker note you will see will say "4.7 billion BOE" - everyone is fully aware its going for gas and maybe oil as well.

Why do you think you know something different ? LOL

:-) :-) = aka chuckles or chuckle chuckle or something along those lines

Final Version :

Luckily FOGL have retained 75% of Loligo, otherwise I would have had to re-work this.

A very rough guide on what success, IF ANY, has in terms of monetary value. Given this mornings Noble farm in I would suspect Noble will farm into Loligo as well, but only after drilling results and any success - allowing FOGL to monetise success very quickly.



Loligo - Interpreting the results of the drill


Loligo is 75% FOGL and 25% Edison SPA (EDF), as according to the recent farm in deal.

First up one should consider the strategic importance of Edison SPA as the farm in partner. Edison are highly experienced in gas and oil exploration/production/distribution. You can see there latest gas PDF brochure on the below link :

Edison SPA (majority owned by EDF)

15.2 billion cubic meters of available natural gas supply. Edison accounts for 19.60% of Italy’s demand for natural gas, 83 concessions and exploration permits in Italy and abroad, 3 natural gas storage centers, 1 LNG terminal, 49.8 billion cubic meters of hydrocarbon reserves.


http://www.edison.it/media/brochure-edison-gas2012.pdf


As can be seen, Edison is a major part of the Italian energy supply system, and its parent company EDF is majority owned by the French government. This brings both the Italian and French governments in with the UK government as having direct opposition to any Argentinean harassment, add on an upset Spanish government over the nationalization of YPF (stealing it from Repsol) and you are seeing a clear picture of major world powers all becoming aligned against Argentina.

.


In the South Falklands Basin the weather/sea conditions are similar to the Norwegian North Sea / West of Shetland. Water depths are not extremely deep (Loligo is around 1400m water depth) and most targets are shallower than 1500m water depth.

However, owing the remote location the criteria for a commercial discovery is higher than it would be elsewhere in the world.

Before proceeding some companies quote OIP or GIP figures (these are Oil in Place or Gas in Place figures and are not the same as "recoverable barrels" or "recoverable gas" which is the Oil or Gas figure after the "recovery factor" is applied. Owing to decent reservoir formations one assumes a 32% oil recovery factory and a 50% gas recovery factor on the OIP/GIP figures)


Oil - a find needs to be at least 200 million barrels recoverable to be commercial as a stand alone project. Smaller sizes that this would only be commercial when tied into a bigger development nearby. In reality to gain maximum value from a discovery it needs to be 400 million recoverable barrels in size - owing to economy of scale, the larger the find you hit a point at which its very attractive to develop, as opposed to being able to develop and make money, you come into being able to develop and make a lot of money.

Gas - a find needs to be at least 5 TCF recoverable to be commercial as a stand alone project. Smaller sizes that this would only be commercial when tied into a bigger development nearby. In reality to gain maximum value from a discovery it needs to be 10 TCF recoverable in size - owing to economy of scale, the larger the find you hit a point at which its very attractive to develop, as opposed to being able to develop and make money, you come into being able to develop and make a lot of money.

Condensate - no idea on this. Condensate is more complicated as there has to be gas re-injection in order to gain the maximum recovery of the oils. If you produce the gas and remove it then very soon the well will stop producing condensate and the total recoverable condensate will be very low. You have to therefore re-inject the gas back into the reservoir to maintain pressures so that gas again lifts the condensate out. Condensate often trades at higher than Brent crude per barrel - but its extraction costs are higher than oil due to the processes needed.


MAKE NO MISTAKE AT THIS POINT - LOLIGO IS A 4.7 BBOE recoverable target - thats 4.7 billion barrels of "oil equivalent" that are recoverable based on P50 estimates. THE UPPER TARGETS WILL LIKELY BE GAS - and owing to their mammoth size very commercial as well (which is why Edison SPA farmed in and Falklands gas via LNG could be a major part of Italys future energy supply) - the lower targets could be oil or could be more gas.

As FOGL are drilling well away from the high pressure/temperature area of the Southern South Falklands, they are drilling in the Northern South Falklands, there are no undue concerns about high pressure as was seen by BOR who were drilling in the high pressure Fold Belt area of the Southern South Falklands.


Loligo's 5 targets :


OIL BASIS - This is the LEAST likely end result, IMO.


T1 = 1509 million recoverable barrels - P50

T1 Deep = 644 million recoverable barrels - P50

Trigg and Trigg Deep is 969 million recoverable barrels - P50

Three Bears = 1588 million recoverable barrels - P50


Based on Sea Lion of RKH and therefore using a 4.7US$ per barrel valuation and taking 75% of that for FOGL's share and 320 million shares in issue.

T1 = 1509m*75%*4.7/1.55/320m = £10.72 per FOGL share value if P50 size oil
T1 Deep = 644m*75%*4.7/1.55/320m = £4.57 per FOGL share value if P50 size oil
Triggs = 969m*75%*4.7/1.55/320m = £6.88 per FOGL share value if P50 size oil
3 Bears = 1588m*75%*4.7/1.55/320m = £11.28 per FOGL share value if P50 size oil

If all targets are oil, based on Sea Lion price - potential £33.45 per share.

As FOGL already have a farm in partner and reservoirs are going to be, if there, large massive thick sandstones and simple to develop the price should be higher than Sea Lion's 4.7US$ per barrel, however, I will use that for now to be conservative.

--------------------------------------

GAS BASIS - this is a VERY POSSIBLE outcome to the well on success.


T1 = Circa 9 TCF recoverable - P50

T1 Deep = Circa 3.8 TCF recoverable - P50

Trigg and Trigg Deep is circa 5.8 TCF recoverable - P50

Three Bears = Circa 9.5 TCF recoverable - P50


Based on Cove's (COV) sale and therefore using a 513 millions US$ per TCF recoverable and taking 75% of that for FOGL's share and 320 million shares in issue.

T1 = 9*75%*513mUS$/1.55/320m = £6.98 per FOGL share value if P50 size gas
T1 Deep = 3.8*75%*513mUS$/1.55/320m = £2.94 per FOGL share value if P50 size gas
Triggs = 5.8*75%*513mUS$/1.55/320m = £4.49 per FOGL share value if P50 size gas
3 Bears = 9.5*75%*513mUS$/1.55/320m = £7.36 per FOGL share value if P50 size gas

As FOGL already have a farm in partner and reservoirs are going to be, if there, large massive thick sandstones and simple to develop the price should be higher than Sea Lion's 4.7US$ per barrel, however, I will use that for now to be conservative.

If all targets are gas, based on COV price - potential £21.77 per share.


----------------------------------


GAS UPPER, OIL LOWER - This is the MOST LIKELY end result on success, imo.


Most likely outcome, if successful, would be IMO, gas in T1 and T1 deep, gas in Triggs and a bonus API 18+ oil discovery in 3 Bears.

This combo of oil and gas would give as below, if all were successful and P50 size.

T1 = 9*75%*513mUS$/1.55/320m = £6.98 per FOGL share value if P50 size gas
T1 Deep = 3.8*75%*513mUS$/1.55/320m = £2.94 per FOGL share value if P50 size gas
Triggs = 5.8*75%*513mUS$/1.55/320m = £4.49 per FOGL share value if P50 size gas
3 Bears = 1588m*75%*4.7/1.55/320m = £11.28 per FOGL share value if P50 size oil

Total gas upper/oil lower result = Potential £25.69 per share.


The strategic importance of having Edison SPA on board now in the farm in is very clear. Had FOGL discovered gas, as is to be expected in the upper zones, then they would, like RKH and the small and complex Sea Lion, had to probably accept a low ball offer to get the project moving.

With Edison SPA on board and their expertise in gas FLNG, storage, transportation and with them having a market already which needs much more LNG pumped into it, as in the earlier PDF, any gas discovery with over 5 TCF recoverable in size is likely to get developed. If T1 and T1 deep come in as gas as is expected then immediately Loligo is well past the 10 TCF threshold at which it becomes very commercially attractive to develop, meaning we would see pretty quick development of Loligo imo.

The joker in the pack is Three Bears, this will be the last reservoir target to be drilled and could well be the one that contains the oil there - exciting that if T1 and T1 deep are gas, we have a commercial success and then we have the icing on the cake possibly down below that. If T1 and T1 deep fail, there is still the big one down below to save the day.

Obviously if they have a duster then its a duster and none of the above matters, but it should act as some sort of rough guide with which to value success on a reservoir target by reservoir target basis, be it gas or oil.



Drill hole / casing of the Loligo Well below :




Drilling depths (below mud line - actual drilling depths) rough comparison between RKH Sea Lion well and FOGL Loligo below :




As Loligo has 4 independent potential "company making" targets (putting Trigg/Trigg Deep together as one) I fully expect them to make multiple RNS announcements of progress during drilling, and not just a single one at the end. Had there been a main target and some small secondary ones then yes, maybe one RNS, but with 4 potential company making finds on the way down, I expect updates to come as drilling progresses. The first 2 targets, T1 and T1 deep are under half the actual drilling depth from sea bed/mud line that the Sea Lion main fan was for the RKH drill, so I expect some news fairly soon, perhaps in 3 weeks or so.

The values for oil in the ground and gas in the ground are low, imo, but its worth starting there at low points to please the bears a little.



As ever, all is IMO, NAG, DYOR !! etc..
.

We will have to agree to differ. There are many outcomes from this drill, but for the sake of not arguing, if the only thing they find is gas I expect the Sp to tank, that is my opinion.


If they find oil and gas we may never know if the gas doubters are correct for obvious reasons.

if all they find is gas, lets wait and see what the SP does. Didn't DES find gas in what was touted as commercial quantities? Must admit I can't remember how much they did find though, but recall it was declared commercial and I also recall the SP dived and is till div-ed.

Nobody has found gas in commercial quantities so far. DES found nothing. RKH have Johnson which is not above the 5TCF recoverable threshold.

Loligo could be the first ever find of commercial quantities of gas.

The threshold is 5 TCF recoverable, the upper 2 targets at Loligo could contain 12 TCF recoverable. Way past the threshold.

Brokers and major shareholders and farm in partners are fully aware - its only some posters on bulletin boards trying to make out gas is bad - its not - not at Loligo - because its so big.

cynic 17 Aug 2012 13:51 1275

"GB-not calling me a liar i hope"

If the cap fits?, what are you going to do sue me..

i've just had a quick whizz through the posts of may/june ..... at that juncture, MrP was generally extolling the likelihood of fogl finding oil in loligo, with relatively little mention of gas ...... the "kindest" extract i can find is as below, but clearly MrP's wind has now quartered so that gas (LNG), in his opinion, is now virtually the only likely outcome


Proselenes - 10 May 2012 05:16 - 523 of 1285
RF - Loligo is likely oil and gas.
5 zones -
2 are more likely gas than oil, 3 are more likely oil than gas. I would not be surprised if the outcome were 10 Tcf of gas and 3 billion barrels of API 20 oil.


The above looks very much like an analysis that it is predominantly oil that will be found, and in huge quantities too!

no, but it just shows you to be a stupid old woman who should know better!

Exactly........ T1 and T1 deep are likely gas, circa 12 TCF recoverable.

The remaining 3 targets could be oil, somewhere between 2 billion to 3 billion barrels recoverable.

Nobody is changing the story - just some muppets trying to deramp saying gas is bad......... people who appear to have no clue about DES or RKH or BOR or what they did, or did not find...................




cynic - 17 Aug 2012 15:32 - 1286 of 1287
i've just had a quick whizz through the posts of may/june ..... at that juncture, MrP was generally extolling the likelihood of fogl finding oil in loligo, with relatively little mention of gas ...... the "kindest" extract i can find is as below, but clearly MrP's wind has now quartered so that gas (LNG), in his opinion, is now virtually the only likely outcome


Proselenes - 10 May 2012 05:16 - 523 of 1285
RF - Loligo is likely oil and gas.
5 zones -
2 are more likely gas than oil, 3 are more likely oil than gas. I would not be surprised if the outcome were 10 Tcf of gas and 3 billion barrels of API 20 oil.


The above looks very much like an analysis that it is predominantly oil that will be found, and in huge quantities too!

deramp or realistic? ...... i think finding gas will equate near enough to the well being a dud; you disagree, so does that make you a raving ramper as so many others say of you?

cynic if neither oil or gas aren't found then at least we may see the last of pp the arch ramper for some time.

Another point worth thinking about is that, by the time FOGL starts producing oil (if there is anything to produce) and if there is any stability in IRAQ, then the latter may be producing in large quantities thereby depressing the oil price. Given that the extraction costs/barrel in the FI will be relatively high, this could mean that the margins will be very low. This is a significant risk, which could affect any of the FI oilies.

Likewise, the US will be self sufficient in gas before too long, and so the value of this commodity will be under pressure as well.

though we are already working with the LNG market, we cannot see quite how it will develop - that is to say, it most assuredly will develop and become a significant power source, but quite what track it will follow is very unclear ...... however, it is correct to say that gas prices in usa are currently very depressed though i do not know why