Highlands Natural Resour... Share Discussion Threads

[superg1] 29/6/2017 11:51

I should be off the LSE naughty step in about 10 mins.

[superg1] 29/6/2017 11:50

Right I've done some digging on all Conoco and Burlington wells in Arapahoe county and the pattern is very clear.

The first point of course is that Burlington was acquired by Conoco in 2006 so effectively it's the same company that decided to do the wells.

Combined in the area they did about 15 horizontal wells to 12.5k depth giving around a 4k lateral with 20 to 22 fracs in each. Some started ok but as of now (April 17) the Concoco wells are on about 300 to 500 barrels per month. The Burlington wells are on 1k to 1.5k barrels per month at this time.

Typical start months for Burlington wells were far better than Conoco typically 15k-18k v 3k to 5k for Conoco for the best start months.

Some of the Burlington wells were eventually shut in and the ones left running are now on 1k to 1.8k per month.

The Conoco wells after 12 months were typically on monthly ranges of around 500 barrels to 1,400 BPM and now sit in the 300-500 range (April 17)

Burlington upped the fraccing levels on 2 12k wells to 38 and 40 fracs the end result was not much different.

Conoco did the same with 32 to 40 fracs on 6 12000 feet wells. Start months went as high as 16k but the end result was not much better 12 months on the monthly rate of the group was about 1.5k to 4k per month.

So plan A and Plan B then turned into Plan C. Increase the depth and up the fracs.

Burlington did 6 wells 14.5k in total depth to 17.5k total depth. Fracs ranged from 37 to 52. Fluids used up to 277,000 barrels in some wells so they gave it a good go.

That resulted in start months as high as 34k barrels but about 12 months later that dropped to 5k to 7k per month.

Now they are on about 2.5k to 4.5k per month. The 34k start well had dropped to 500 barrels in the end and has been shut in. That one had 48 fracs and was 17,300 TD.

Conoco

They did 4 wells of 15k to 17k feet deep. 40 to 49 fracs in each.

After 12 months they ranged form 1.5k to 7k per month, Start months as high as 28k.

3 at 5 to 7.5k after 12 month and now those are on 3.5 to 4k per month

1 of them isn't that good 40 fracs 16,500 feet was on 1.5k after 12 months and now 500.

So it seems Conoco including the acquired Burlington did over 30 horizontal wells. They didn't get good results for 12 k wells with 20-22 fracs, so upped the fracs which eventually saw them scaling up to over 50 fracs and up to 17,500 of drilling before they seem to have abandoned the area when the oil price dropped.

Then drilling was around 2014 and early 2015 by which time oil hit $60 per barrel having dropped from over $110.

The whole picture of the wells shows that to get the high start numbers you need to drill big go big on frackers numbers and up to 277,000 barrels of fluid to get the best results.

However the decline is severe and typical across all wells.

The best of the large wells is now doing 4k to 5k barrels per month.

I have a typical range of from 25k to 25k dipping to 5 to 7k after 12 months. A 5 fold drop. Then as of now its 7 to 8 times less than the opening production.

The same can be said of the smaller 20 frac 12k feet wells.

It's clear that Burlington wells overall did better than Concoco wells so now it's case of looking on the map to identify where the Burlington wells are in relation to Concoct and HNR permits.

So back to the HNR point. What is the definition of numerous when claiming there are numerous wells in the area that did over 100k barrels in the first 6 months of producing.

There are only about 10 examples of wells that went to the depths HNR may do (if they get the cash). How many of those did what they claim? :-)

[superg1] 29/6/2017 08:45

There are some bits about certain members of the company that can't be posted as it would involve me trying to get the details from the US to back up my comments.

While I fully trust the info I can't guarantee getting access to it to back up claims.
Some of it was known before HNR appeared hence when they did I asked some WTF questions on what I knew.

[rafieh] 28/6/2017 16:23

Hats off to Family Values who called this one right. I followed my usual rule that if "good news" doesn't do anything to improve the SP, you should get out. I took my loss at 24.25p. I must admit FV's warning was also a factor which helped me arriving at that decision.

[lodgeview] 28/6/2017 14:04

What a complete dog.

[phoenixs] 28/6/2017 14:00

I see that 210000 shares just sold. Penny beginning to drop I fear.

[superg1] 28/6/2017 08:38

Why would I want to short a company that puts out false news to bump up the share price.

I forget but didn't Mendell cash in a load on here, knowing his condition he'll need to do that more often.

[superg1] 28/6/2017 08:18

I've just had a look at the directional wells around where HNR are permitted. I mote they never mention Burlington resources some wells of which are only a few miles form the Concoco wells.

Burlington was acquired by Conoco

There is a clear pattern be it Conoco or Burlington wells. Burlington also did big wells up to around 50 fracs.

What is apparent is that the wells chuck out decent oil in the first 2 to 3 months then it plummets.

Typically after 12-18 months both Burlington and Conoco wells do around 3000-4000 barrels per month on the large horizontals. Burlington have some large wells doing less than that in the same period.

So a typical result post the initial rush for HNR if they drilled the 6 big wells is going to be a rate of 3000-4000 barrels per month after 12-18 months.

I suspect each well would be at least $6 mill each.

So a $36 mill spend in a short time time would result in oil production for 6 wells of about 600-800bpd.

That assumes all wells perform at the level of the best Burlington and Conoco wells.

Now compare the to the rose tinted words of HNR talking about the wells doing over 100k barrels in the first 6 month of production (which is untrue BTW)

That infers wells doing 200k barrels per year. 6 of those would be 1.2 mill barrels per year.

However the swift decline rate puts the wells on 200 to 300k barrels per year for 6 and they continue to drop.

[heo] 28/6/2017 07:54

Okay, Superg1, I suggest that you short HNR and keep it to yourself. We don't need constant harassment of you know all mentality.

[superg1] 28/6/2017 07:04

More facts and using Nighthawk as a comparison.

Nighthawk are in Colorado and they happen to have 20 producing wells which matches the number Conoco did.

Nighthawk wells are conventional and I recall costs about $1.5 mill each.

Top producing wells for Nighthawk in any year did 166,000 barrels and 127,000 barrels.
For Conoco 128,000 and 126,000.

Conoco wells were about half 20 frac horizontals with many up to 40 fracks then 3 as high as 48 fracs with 1.5 to 2 mile horizontals.

Conoco wells will have cost about $100 mill or more, Nighthawk $30 mill.

For 2017 up to April the 20 wells for each company totals are

Conoco 86,895 barrels
Nighthawk 151,247 barrels.

Nighthawk wells costs near 4 times less and are producing near double what the Conoco wells are doing.

Now if you don't know Nighthawk have a look at their market cap and share price to see what the market thinks of far better costs and returns that HNR are chasing.

[superg1] 27/6/2017 22:27

The planned wells are just outside Denver to the south east. If you check the map and out a tick in the pending web box the light blue squares will populate the map.

Then hover the pointer over the lowest blue square on the Elbert Arapahoe border you will see it brings it up as a HNR planned well.

All the action seems to be North of that point with HNR on the Southern extreme of the activity with nothing going on below them which doesn't put them in the hot spot Imo.



Bison seem to have a bit going on to the north so perhaps it's best to keep an eye on them.

[superg1] 27/6/2017 21:03

Jackbal

I just spent about two weeks compiling a file on a company which went to regulators so I'm quite resilient when it come to that and purely driven by knowing folk that have lost the lot backing Aim companies that lied.

I have been helping out the Paragon diamonds lot where one PI is taking action and creating a bit of a group action.

So I will report my finding on the Colorado asset and the news around it. I may as well I've nearly done the lot anyway. It doesn't take long to do the surrounding counties just to make sure, such is the nature of the comprehensive Colorado oil and gas website.

I did point out it was untrue way back but few listen.

To see that statement in the year end news says to all about the company. What can you trust in anything they say if they are prepared to lie.

I suspect that's why they went main market to avoid nomad intrusion.

Duxy

If there was a nomad I'd be on to them but I know something about Mendell that you guys don't which makes engagement with the company pointless and would explain the lies in any case.

[pounds2penny] 27/6/2017 14:23

PS Zengas and Keya were saying 500p and they were not going to sell one shs before their target got hit?

I thought this was $100bn market, which HNR was going to capture.

[duxy786] 27/6/2017 10:33

Those wanting to get out, today would be a good day as it seems like a dead cat bounce.....

[pounds2penny] 27/6/2017 09:20

your 50 quids benefit money dux?

[duxy786] 27/6/2017 01:42

Smelt a rat a couple of weeks back and decided to jump ship. Glad i got out now as id put a pretty nice chunk here. Good luck to whoever hold faith...i can't see this going anywhere but down now but that's just my opinion. Great research from all and thanks for sharing.For the poster above who believes there has been foul play, I suggest you email management and ask them to explain before reporting it, tweeting it and demanding an explanation and an investigation.

[simonsaid1] 26/6/2017 17:15

Lovely manner you have. Your concern is appreciated, and if you feel you've sniffed foul play then please do report to regulators. For the time being I trust what I've read about the company and the people running it, and I've chosen to take that risk with a small amount of my own money (I don't 'bet the farm' on this kind of share). You needn't mock and harangue anybody who chooses to do so, or who feels skeptical about your motives. You are a deeply impolite individual, which is peculiar considering you claim to have a benevolent 'mission' here protecting investors.

Unlike you, I won't conduct myself online in a manner I'd be ashamed to in real life. So I'll simply wish you good luck with your investments. You may return to ranting about 'ignorant PI's' now.