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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: June 26, 2012 02:40AM

[www.proactiveinvestors.co.uk]

Falkland Oil & Gas reveals tie-up with French utility EDF

8:23 am FOGL says it expects to receive the Leiv Eiriksson rig in July, once fellow Falkland explorer Borders & Southern has completed the Stebbing well FOGL says it expects to receive the Leiv Eiriksson rig in July, once fellow Falkland explorer Borders & Southern has completed the Stebbing well

AIM quoted Falklan.............
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Stocks Discussed: FOGL.L,
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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: June 26, 2012 07:41AM

Interview to listen to :

[www.proactiveinvestors.co.uk]

And FT comment :

[blogs.ft.com]

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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: June 29, 2012 09:13AM

Borders and Southern AGM presentation today, link below. As everyone should know they are drilling near to FOGL's licenses area's - Darwin well complete and Stebbing well ongoing.

[www.bordersandsouthern.com]
.


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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: June 29, 2012 08:03PM

BOR AGM notes from "TheFlyingMule".......

......Good evening all. Here is my ‘summary’ of the AGM today. It’s a bit in depth but I hope it’s of some use. I do have a recording of it, which I will try to upload when I get more time but these are my thoughts on the morning’s events. I’ve reproduced my notes as best I can, though I can’t guarantee the accuracy and there are others that are far more qualified than me to comment on the technical aspects but, again, I hope it provides at least a flavour of the meeting.

An excellent day all told. I’d recommend going to the AGMs of these companies – the opportunity for access to the BOD of multi million pound companies doesn’t come along very often!

I imagine there were around 50 shareholders there (I think last year’s was 15 or so?) as well as various analysts, PR people and the BOD of course. The meeting started at 10:00 and went on for nearly an hour and a half, which left just half an hour for further questions on the sidelines before everyone was ushered out before the next corporate do commenced.

Harry Dobson (HD; Chairman) kicked things off with the resolutions and they were all duly passed unanimously with a show of hands, including amusing witterings from HD proposing himself (I’m not sure Mr. Kozel will get the same reception for the remuneration resolution at GKP’s AGM in a few weeks..!).

That wrapped up swiftly and Howard Obee (HO; CEO) then launched into the AGM presentation. This wasn’t the same presentation as is now on the website – more on that later – but he talked us through it with questions from the floor as we went along.

HD emphasised at the beginning that there would be no discussion about Stebbing. He initially said it was ‘tight’ – my first thought was ‘oh no, not another DESaster with their tight sands at Rachel’. Then I thought he meant time was tight, as in there have been delays and, finally, with a request for clarification from the floor later on, he confirmed that ‘tight’ meant there was essentially a communications blackout regarding Stebbing! Drilling continues…

Anyway, on with the show.

Darwin:

- The numbers given were for Darwin East and West. Shallow marine environment in the lower cretaceous.
- Condensate samples were shipped back to the UK. It isn’t permissible to fly the samples on commercial flights so they could either spend several hundred thousand dollars chartering an aircraft or they could sent it by ship, which they obviously have done and it took four weeks to arrive.
- The geological results were extremely close to prognosis with the top of the reservoir predicted to within one metre – not bad for rank wildcat drilling eh?! [Over the 4,800 metres, that’s an error of 0.02%!!]
- Condensate value depends on its content. They BOD would not be drawn on ‘possibilities’ but their overall enthusiasm would suggest they are confident.
- Gas Initially In Place figures were given (Min 1.88TCF, Most Likely 2.44, Max 2.88). Liquids content is subject to on-going analysis. 10 weeks from 18th June.
- The TD of the drill ended up in water bearing sands. They felt there is a possibility of more sands beneath the water but seeing as they already had a valuable condensate find, they were content to leave that for another day. [I suspect they were wary of any more cost overruns and opted for prudence]
- Delays were caused by problems with the rig itself and also due to taking a long time to drill through some of the rock formations. Extra casing needed to be set to stabilise the hole. Rank wildcatting will always be a laborious process so not unexpected imo.
- Part of the extra time to drill through the rock was due to using water based drilling mud rather than oil based mud. It’s more environmentally friendly to use water but doesn’t perform as well it seems!
- Two thirds of the $40 million cost overruns were related to the other supply costs of hiring a rig.
- We were treated to the logs of Darwin; this information, along with the seismic slides, is not in the presentation on the website. I would love to pore over them in more detail rather than craning my neck at the slides from a distance but I’m sure Gramacho (delighted to put a face to the name at last but disappointed about the lack of elbow pads!) will be able to provide some colour. Without giving too much away, HO seemed quietly confident when discussing the gas readings.
- MDT gave the Gas-condensate gradient information, which told them of the condensate.
- The source rock wasn’t penetrated. HO believes that is still below where they drilled Darwin. Geochemistry testing of the cuttings to come in the next few weeks which may help answer whether the condensate was a result of the quality of the original source rock or whether it was a function of the thermal and migration history of the hydrocarbons that were generated. That will then aid prediction of distribution of oil, gas and condensate in the region.

Rig:

- Excellent team on board the LE. Having a high spec rig is all good and well but if there aren’t the appropriate operators, it’s potential won’t be realised. Fortunately there are excellent crews on the rig!
- The rig itself is performing very well. A few days ago there were 18/19m waves and it carried on drilling.
- Environmental conditions are less harsh than expected. Originally, it was thought they would be similar to those west of the Shetlands. It seems conditions are more benign than there. This is in part due to the southern tip of South America essentially acting as a windbreak to the large weather systems that come in from the west from the Pacific and protects the Islands from the worst conditions as the fetch distance is greatly reduced. [nice to know Argentina still helping out, even if they don’t want to ]
- BOR own the rig contract. When it was asked whether there would be a fifth well in this current campaign, HO said it was a possibility but it would depend on timings as it is due to go to Scandinavia after finishing in the Falklands. [my impression was they weren’t particularly keen on drilling another well; they have enough on their plate and they don’t want to be rushed into something just for the sake of it.]

Future Campaigns:

- Appraisal of Darwin should be relatively straightforward.
- The next campaign will have “a lot more wells.” Exploration will take place alongside the appraisals and would be at least 5 wells. Rig availability the key issue.
- Open acreage will be of interest to them eventually – hence the relatively hush-hush nature of their communications strategy.
- 3D; both new and re-processing existing. They were absolutely delighted with the ‘superb’ data and that was what put Darwin on the map, so to speak.
- Currently tendering for 3D seismic with the aim of shooting it in the southern hemisphere summer. Currently seems to be a good availability of seismic boats.

Prospects:

- Next 3D to be shot to the north of Darwin.
- Covington is a tilted fault block to the north of Darwin but only on 2D. This is a priority. It looks uncannily similar to how Darwin did on 2D. They then got the 3D and the rest is history! HO optimistic Covington will look similar to Darwin with the 3D.
- Deeper targets of Stokes and Sullivan.
- All prospects are a similar age and, with the positive result of Darwin, reduces their risk profiles compared with six months ago.
- Burgess and Bute fan systems ‘down the slope’ in the deeper marine environment. As a rough indication, Bute could be 1 billion barrels for that sized fan.
- Prospect inventory with resource estimates to come when they re-evaluate, including other new leads.
- Darwin smallest prospect in terms of area (with 2.5TCF of gas).

Funding:

- Lots of options, especially thanks to having 100% of their acreage.
- HD was extremely confident of getting any $$$ that may be required. He was fairly tight lipped but felt with the masses of top quality data they have, they wouldn’t have any trouble getting funds when needed.

Communication Strategy:

- It was inferred the BOD weren’t working in the best interest of shareholders by being so averse to publishing detailed information. HD was reasonably unimpressed with this suggestion I think. Commercially sensitive information is the key; it’s an excellent bargaining chip and should stop a hostile takeover.
- Bulletin boards were discussed. iii called HO and said the site had had 23,000 hits leading up to Darwin results.
- HD didn’t like bulletin boards as he felt they encouraged rumours with ramping/de-ramping etc. [Though, of course, if they were to release more information, there would probably be less speculation...]
- Concerning relations with the Falklands Government, HO said they had excellent relations with them and found them to be extremely helpful as and when they required. When asked if he thought FIG may improve royalty terms to encourage development of Darwin if the condensate results weren’t so promising, he thought it unlikely seeing as the terms are already extremely favourable. He was more concerned they may shift the royalty rates up now they’ve found something!

My 2p Worth:

BOD very much in this for the long term with HD stating this will see him out until the end of his days. They do have incentives, in the form of 60-70 million shares between them.

Technically, I think they’ve done a fantastic job. Their prospect inventory looks very interesting and they are keen to tick all the boxes in a timely and appropriate fashion. They will not be coerced into publishing data just for the sake of it. [this largely related to a question regarding the condensate yield. Gramacho very kindly offered his prediction, which I’m sure he’ll come to later]

HD believes the market doesn’t understand the significance of Darwin.

On a personal note, I like to see a strong technical side to the company and I have to say I was very impressed with the technical story at BOR. They seem to be going about things in the right way, which, given time, will reward patient investors.

I would say they could work on marketing the company better. Yes, they have a long term view but a higher share price doesn’t do anyone any harm!

That’s all for now; a long but very worthwhile day.

GLA,

TFM............



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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: July 5, 2012 07:46PM

I like the last line "......Argentina lost the Falklands over Repsol"

[oilprice.com]

Business as Usual for Big Oil Despite Falkland Tensions

By Jen Alic | Thu, 05 July 2012 22:44 | 0

Benefit From the Latest Energy Trends and Investment Opportunities before the mainstream media and investing public are aware they even exist. The Free Oilprice.com Energy Intelligence Report gives you this and much more. Click here to find out more.

While tensions between Britain and.............................


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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: July 20, 2012 06:15AM

The "idiots" guide to the Loligo prospect.

Loligo will be the first of two drills by FOGL.

Loligo has a P50 Oil In Place (OIP) estimate of nearly 16 billion barrels of oil

In the event Loligo is all oil it is expected the P50 recoverable barrels would be in the region of 4.7 billion barrels.

In the event Loligo is gas it is expected the P50 recoverable gas would be 25 TCF.

There is considerable upside potential to the P50 OIP figure, as of course there is downside as well. Loligo could end up being small or nothing, or indeed it could end up being 25 billion barrels of OIP.

The bare minimum requirement for economic gas development is 5 TCF, however this is not that attractive. The economics of gas development in this location become hot, hard and horny attractive when you get to 10 TCF recoverable or more. Therefore should Loligo be dry gas it is extremely commercial given 25 TCF P50 recoverable gas estimates.

Loligo has 5 targets, these being T1 at the top, T1 deep, Trigg, Trigg Deep and then Three Bears at the bottom.

The work done by BHP suggests the upper couple may be gas and the lower ones more likely oil. This is why FOGL tried their best to put themselves into a position to drill "Loligo Deep Well" which will go through all 5 sections.

The size of each target zone (based on oil) as we go from top to bottom is :

T1 = P50 OIP of 5 billion barrels = 1.5 billion recoverable barrels.

T1 Deep = P50 OIP of 2.15 billion barrels = 644 million recoverable barrels

Trigg and Trigg Deep = P50 OIP of 3.24 billion barrels = 969 million recoverable barrels

Three Bears = P50 OIP of 5.3 billion barrels = 1.59 billion recoverable barrels

(For a comparison Sea Lion of RKH is OIP of 1.3 billion barrels and circa 400 million recoverable barrels from that OIP figure)

As you can see Loligo is potentially around 12 times larger than Sea Lion.

Loligo has had several 2D seismic studies done giving very good infill data, and 2D with infill is far superior to standard 2D. BHP also did extensive studies and the conclusions are there are strong DHI's for the Loligo prospect - sadly for BHP their South American mining interests were used against them, IIS, to make them drop their FOGL interest, something they did not want to do but were pressured into. They wanted to retain back in rights given they know how prospective it is, however the Falklands Government refused to allow back in rights and BHP ended up having to let go of the lot in order to preserve and protect their South American mining interests in the face of Argie/Brazil pressure.

RKH recently accepted what I would call a "low ball" offer from PMO, its appears PMO was the only bid on the table at a price level that could be considered to be accepted. There are reasons for a low ball offer, one being presently Sea Lion is a stranded oil find, Sea Lion is not that big, Sea Lion is going to be difficult to develop based on the thin multiple sands (meaning lots of wells needed and difficult EOR (Enhanced Oil Recovery)). But anyway, using the 4.7 US$ a barrel that PMO aid to be conservative you get :

4.7 billion recoverable barrels of which 75% is FOGL interest.

Thats 3.525 billion barrels to FOGL x 4.7 US$ = 10.7 billion pounds sterling.

10.7 billion divided by 320 million shares in issue = 33.5 pounds per FOGL share should Loligo be full of oil and thats based on "low ball" figures.

And that is just the Loligo prospect (FOGL has over a hundred leads in the license areas with potentially 300 billion barrels of OIP and 100 billion recoverable barrels potential).

FOGL is considered the "Jewel in the Crown" of the Falklands, and its no surprise a multi-billion major like EDF farmed into FOGL via Edison, and also no surprise that FKL hold lots of FOGL shares.


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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: July 20, 2012 06:21AM

Loligo is a classic Gulf of Mexico Class 3 AVO type anomaly.

To allow people to know what this means, see below :

1. AVO Class 3 Gas Sand:

• Unconsolidated sand, porosity greater than 25%, usually Tertiary in age.

• Gross interval velocity usually less than 8,500 ft/sec (2,650 m/sec). Gas and oil zones are bright spots on the stack section and on all offset (angle) stacks.

• AVO: The reflection amplitude, with respect to background, increases slightly with increasing offset distance or angle.

• Note: A Class 4 Gas Sand has same the characteristics as a Class 3 Gas Sand except the reflection amplitude decreases with increasing offset, caused by a hard shale or carbonate (shear velocity higher than gas sand shear velocity) on top of the sand.

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

2. AVO Class 2 Gas Sand:

• Moderately consolidated sand, porosities 15% to 25%.

• Gross interval velocity in range of 8,500 ft/sec to 12,000 ft/sec (2,650 m/sec to 3,650 m/sec).

• Acoustic impedance of gas sand and encasing shale about equal.

• AVO is strongly more negative with increasing offset distance or angle.

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

3. AVO Class 1 Gas Sand:

• Very consolidated sand, porosity less than 15%.

• Gross interval velocity usually greater than 12,000 ft/sec (3,650 m/sec).

• On stack seismic data, a large positive amplitude for a wet sand decreases to a smaller positive amplitude for a gas sand ("dim spot").

• AVO is less positive with increasing offset (angle) and may have a phase change at far offset distances.

The boundaries between classes are gradational, and therefore it may be necessary to evaluate amplitude anomalies in two classes.


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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: July 22, 2012 02:07AM

My take on the risk......

[boards.fool.co.uk]

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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: July 22, 2012 10:45PM

For those who want more technical detail on the well, see link below :

[boards.fool.co.uk]

.


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Re: FOGL.L (Falkland Oil and Gas)
Posted by: Proselenes (IP Logged)
Date: July 24, 2012 10:35AM

Edison Reserach update on FOGL.

[www.edisoninvestmentresearch.co.uk]

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