Hurricane Energy Share Discussion Threads

[ngms27] 06/1/2020 10:41

The technical report is available here:

[ngms27] 06/1/2020 10:39

Aquaeasulis01, we don't know enough about the water given they were operating on a single flow line prior to the last individual tests.

I remain open to both ideas of perched water or coning, the problem being coning means early failure and shareholders caught with there pants down.

Given this was a near farm bet the increased water is the main reason the risk became unpalatable to me.

[ngms27] 06/1/2020 10:32

Fluid distribution data is provided by Hurricane’s deep inclined well, 205/21a-4.
In the CPR, a model of varying fluid distribution was applied to take into account the
downside possibility of perched water being encountered in this well. Re-interpretation of
this data indicates that the water encountered could have in fact been coned from deeper
down, rather than being perched water. Additionally, comparison with the extremely high
productivity of the horizontal well and observations of a highly connected fracture network
make the model of perched water within the reservoir far less likely. Therefore, a Free
Water Level has been modelled in the simulator rather than a complicated perched water
model - this is useful as there is no way to distribute perched water effectively, and the
simulator is unsupportive of running such a model as initialisation of the model enforces
equilibrium and drops the water to the base of the structure.

[aquaesulis01] 06/1/2020 10:19

ngms

"Shut-in and choke-back analysis of the fluctuating Water Oil Ratio (WOR)data can provide clues to the problem type. Water-entry problems such as coning or a single fracture intersecting a deeper water layer will lead to a lower WOR during choke-back or shut-in. Fractures or a fault intersecting an overlying water layer have the opposite effect."

hxxps://petrowiki.org/Controlling_excess_water_production

As HUR have told us that they initially tested Well 6 in isolation of Well 7z (which must have been shut-in) for an extended period in October, and post the subsequent individual running of well 7z we got the increased water-cut reported, isn't that further evidence of overlying (perched water) rather than coning according to the extract from the link above?

[lfdkmp] 06/1/2020 10:16

One thing that's become clear to me is that this share is no longer, (if it ever was) a get rich quick stock. To that end many of the "overnighters" have picked up their swag bag and departed.

I'm reminded many years ago of a tag line that an investment trust used,(think it was Foreign & Colonial), particularly for monthly, pound cost averaging, investments.

Whilst not wishing to draw too many parallels with HUR and investment trusts, maybe the tag line has some resonance:

"Get Rich Slow"

[gengh15] 06/1/2020 09:56

ngms
"However well 4z went from perched water in 2014 to coning from the aquifer after further analysis in 2016."

Can you provide a reference?

[datait] 06/1/2020 09:55

All market makers moving up.

[datait] 06/1/2020 09:44

The only way is up babyyyyyyyyyyyyyyyyy

[datait] 06/1/2020 09:40

fill your boots and big knickers

[tournesol] 06/1/2020 09:36

Thanks to Hazydaisy for posting the link to the EV article and to Oilretire for nudging me into reading it.

Seems to me that there is no way to reconcile the idea that water is coning up from below with the assessment that Trice and Hurricane are honest. It's either one or the other.

It's all too easy to get this kind of thing wrong. I still smart where I took a beating from GKP. But in that case I had no illusions about management, I simply thought they had good assets and I did not anticipate the collapse of Iraq. I was wrong about the assets and wrong to regard Iraq as stable enough to invest in.

I still like the HUR story and I still regard Trice and his team as honest and competent. I never expected the implementation of HUR's stratgey to go perfectly smoothly and I said as much here many times when urging people not to get over-optimistic.

Looking ahead, we've all got choices to make here.

1) To hold on the basis that Trice/Hur know what they are doing and are being honest and that the doubters are wrong.

2) To sell because there are question marks being raised and we are losing confidence.

3) To adjust position size to factor in the perceived increased risk.

At the end of the day it's not advanced calculus. It's what investors should be doing every day.

T

[amaretto1] 06/1/2020 09:21

Mmm ... got to agree.All answered in that article.

[bocase] 06/1/2020 09:20

..and significantly, no concern over water cut!

[oilretire] 06/1/2020 09:16

Great article in EV, thanks for the link. Take time out to read the whole thing regardless of which side of the debate you sit.....

[excell1] 06/1/2020 09:01

Absolutely zztop.

[sentimentrules] 06/1/2020 08:56

Brutal weakness on such a day. Bulls should be covering it elsewhere now ...

[zztop] 06/1/2020 08:55

Nice way of answering al outstanding questions without issueing an rnsHurricane are getting crafty?

[amaretto1] 06/1/2020 08:50

Heavy seller in the mkt.. no doubt about that !!

[whitegold1] 06/1/2020 08:49

Not great ...

[soilderboy] 06/1/2020 08:48

Great post. Good find.

[bocase] 06/1/2020 08:47

Haider: That is exactly as it was stated in the RNS. No discrepancy there.

[haideralifool] 06/1/2020 08:43

From the 2nd December RNS:
The well flowed for a total of 85 hours in a number of flowing periods at variable rates, using both an electric submersible pump ("ESP") and under natural flow, while work continued to clean the well and evaluate reservoir performance.

From the EV article:
However, while controlled natural flow conditions achieved a stable rate of 1,300 barrels of oil per day, a stable rate could not be reliably measured while using a pump as the well was still in the process of cleaning up.

EV understands the well had not in fact been cleaned up prior to P&A, though clean-up operations during the drill-stem test were widely reported. If indeed the well wasn’t cleaned up, this suggests that hydrocarbon flows would have been greater had this been carried out.

So was the RNS wrong? And how material is the discrepancy?

[amaretto1] 06/1/2020 08:41

Going to test 29 again

[bocase] 06/1/2020 08:36

From the horses mouth.

Mr Trice said: “We’ve been playing around with the two production wells we currently have – turning them on, turning them off, doing interference data, all sorts of clever things.

“So far we haven’t found anything to make us change our opinion of the Lancaster reservoir.”