Petrel Resources - moderated discussion/research part II

It's really quite insulting that 'he' thinks anyone can be taken in by this sort of stuff. That's arrogance for you, though!
For myself...I'll go with Steve Bolton's report and my own impressions of the integrity of the Petrel management:

27-Jul-06 at 09:50 | IP Logged

Petrel Resources AGM, Dublin, 26 July 2006

After a brief intro from John Teeling, David Horgan presented for around 40 minutes without notes, and spoke very eloquently and passionately about Petrel’s performance to date and its prospects. Personally I was immensely impressed by him through his commitment, focus and knowledge.

He talked about Iraq’s undiscovered potential and basically Iraq has not scratched the surface yet. Other countries like Saudi and Kuwait have drilled down to the Jurassic layer at c. 12000m and found large structures. Saudi has 80,000 wells. Texas has 1m wells with the best technology to support extraction. Iraq has 2,300 wells and has only gone down to relatively shallow depths of 1-2000m. There is vast potential.

Petrel’s relationships in the area are excellent – they only act with express permission of the Ministry of Oil, and this will be the policy going forward, including release of milestone achievements to the market.

The objective for S&L is to deliver it on time and to budget, which is currently on track. It is the only live project of the three post war contracts awarded, with access and security issues proving problematical. In the south, predominantly Shia, it is relatively stable. The longer term goal with S&L is once it reaches its 200-250k barrels per day, is for Petrel to offer to run it on a risk sharing basis. This will also include a drilling programme, which will be proposed once legal framework is in place. Petrel will also assist with the recovery of liquids from the gases currently being flared off at S&L, which will result in the additional recovery of 4k barrels per day.

Regarding Kormor, there are three known bids in; Petrel’s is the highest specification and highest cost. Again there are access issues with the area, which is in the north, which is the likely cause of holding up the decision. However, Petrel’s view is that they are unlikely to be awarded the contract, but no decision has been made yet, and there would be delays in commencing work anyway.

The Merjan study has only recently been completed, due to delays in receiving data and the data cleansing has only just been completed, although the data is pretty good. Petrel has been in discussion with prospective partners, and is likely to bring a partner in for discussion on Merjan, with c. 760 m barrels, based on what is acceptable to the Iraqi’s. Discussions are progressing with a partner which is not an Exploration and Production company. The completion of the Merjan study will be a key focus in the next six months.



Block 6 is considered to be a very valuable asset. Early maturation studies suggest that there are large structures present. Verbal confirmation of Petrel’s title has been received, and no problems are foreseen, although the terms will need to be reviewed in the context of the new Hydrocarbon law.

DH was in Jordan last week meeting with the Southern Oil Company of Iraq at the Government’s request to discuss a proposal to study a 16bn barrel prospective oil field in the south. The field was discovered in 1986.

The PSA with Jordan is on excellent terms and potentially could be approved with Sonoran’s PSA in August. The King has advised Parliament to approve it. The first target will be the oil play, with seismic hopefully completed over winter, and drilling to commence end 2007. This is best case, as any delays in approving the PSA will have a knock on effect on when seismic can be done.

The board was very bullish about prospects, but cautious about timings and risks. Personally, I got a lot out of meeting the team face to face and felt it was time very well spent. Make you own judgements, folks!!