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I believe SEO has look at this investment from every angle. I think he has determined what his plans will be, depending on circumstances. He knows what will make him sell, how much & when. He is worth a consertave 3 billion, some say more like six.
I am sure he has calculated how much he will make by staying and knows what all the alternatives are. I am still figuring them out.
I expect as oil discovery is PRed share price will raise & the alternative of selling shares at a large profit will figure into the picture. Then I have to decide if I sell for $4.60 per share or hang on for $2.00-$4.00 per share per year.
At this point both are attractive, but which one will I like best when those numbers actually become real?
Maybe I do some of both.
So Red if I get this right we could sell for $10 per share and get 1000 per 100 shares or keep the position and make 200-400 per 100 every year for 20 years, or 4000-8000 per 100shares on the life of the wells
Were your figures based on block 2, 3 & 4 only?
Has anyone calculated how much this stock would payout if SEO just decides to keep his shares and sit back and collect the revenue as it comes in? It comes to mind that ERHE could just function as a conduit, collocting oil revenue and paying it out to shareholders and not trying to be anything else.
Exxon knows what they are buying, we may be handeled the same way once they finish drilling and know what is actually down there. Its a big difference in buying a proven field vs a prospect
Strass, these ships have logging while drilling capability, I don't know how much information that adds to the original Sismec info but we now have an instrument package actually down in the hole with the drill. I know they are getting readings on the formations they have drilled through, does any of the actual oilmen or women know just how much information they are collecting.
Midtier, at this point I don't think there is a chance of a dry hole. I don't expect we are going to get a lot of information either, I may be wrong but I am expecting the same kind of PR issued on block one. Even rumors would be better than nothing at all, we would at least have the fun of suporting them or tearing them apart.
We all know there are people sending information from those drill ships to two company headquarters and teams of engineers studing every inch of that bore, and I would bet at least one ERHE stockholder knows exactly what been found, its knowing that something is keeping them working those sites and not knowing what it is or how good "beter then expected" is.
I find it strange that if Deepwater Pathfinder has moved to Lemba that they have not made some kind of PR. I have been expecting the non-discript "we have completed drilling to target depth at Kina-1 and have found hydrocarbons. We have collected samples of both formations and fluids to evaluate the prospect. Deepwater Pathfinder has moved to the Lemba site to drill an aditional prospect there."
No news makes me wonder, the JDZ officials have said drilling was going "well" and "beter than expected" Why don't we hear something?
I just may have read too much possibility into the option for four wells being droped and chance of a buy out, it was a good therory while it lasted
Dane, Dadd said when all those posts were getting deleated a week or so ago it was the Ihub moderators, not ours, you can look and see who deleated a message
John, if they do then my therory is out the window - if it looks like a duck but honks like a goose, I don't know what I've got, just a SWAG
Puff, thats what is making me excited, JDZ contract requires one well in block 2 & 3 and 2 in block 4. Somebody want that extra well. I am sure Addix could have contracted for three wells in 90 days, but four lets them look at all three clusters of prospects in block 4.
Something I would want to do before I put my cash on the table.
Brez, this is why I think the next two wells drilled in block 4 are so important. If they go back and drill Kina south or something else in the Kina cluster I don't think a deal is going, but if they try and drill one of Ofo, sundy, singi & Gandu and one of Oki, Oki central, Oki east & Stratz, they can figure on three developable clusters in block 4.
JMHO but I think thats why there are four wells to be drilled, one to meet the requirements of JDZ contract on block 3 and three to prove the block 4 clusters are commercial. And know what (SE)Offer they will take or make. No shred of information, JMHO.
Strass, I keep going back to the significance of the Deepwater contract. Originally they anounced they had the Deepwater for four wells with a option for four more. The JDZ contract requires the operator to drill a well or spend a number of million on block 2 and 3 by the middle of 2010. Block 4 has to have two wells drilled in the same time period. Addix contracted for four wells with a option for four more, thats one well in three and two in four, as required, and one to five extra. There has been no mention of the optional four wells in weeks. IMHO sombody wanted a certain number of test wells, maybe before making a offer or accepting a Offer price. Maybe initial drilling results were so good the extra four wells are not needed to set the deal. I never expected there would be a predrill deal, the chinese have plenty of money to spend, but they have to account to their government for how they spend it. If Senopec bought a pig in a poke and didn't get full value for the governments money, they might find themselves in charge of the anartic drilling division. JMHO.
The vessel was custom built for Akpo
Not necessarily so, They may know that nothing is going to happen soon. I don't think Addix would have contracted for four wells if the proposed buyout could have been made on less data. JDZ contract says that block 2 and 3 will have one test well drilled by next summer and block 4 will have two. Why drill two more at $600,000 per day unless they are proof of concept.
I think where they drill the last two wells will be very informative. Has anyone seen anything about the location of the last two wells? Kina South?
John, I like your idea of 400' of net pay - I hope our official PR is going to be as good
Stocks, it is not unusual for a public corporation to be incorporated in a different state than they have their office. When I first started in business the "state of choice" was Delaware over the years it has moved to Nevada and then to Colorado. It has to do with the states laws governing corporations, nothing more. Oilhead has also made some statement that show he knows something about drilling but may not be current in his technical knowledge & that he definately has not gone back and read past posts on the board.
YankeMike, a couple of things Oilhead has posted has made me question how up to date his knowledge is. When they are only drilling 4000' on dry land it isn't necessary to be state of the art, these wells were drilled for $60,000 to $90,000 and another 60,000 for completion, if developable, not $600,000 per day.
When I first looked at this stock I knew a little about deep water drilling, of course I at that time thought 1200 or 1300' was deep water. 5400' is a whole different science.
My feelings exactly, I think we all feel that our stock is worth several times the SP, but how many? The drilling will prove the accuracy of the estimates. Acpo doubled the initial estimates after they drilled a well and said they may still be 30 or 40% low.
We are dealing with a government controlled chinese company, making a bad deal is probabily a capital offence.
YankeMike, I think some of the difference is related to technology. Both of these rigs have "logging while drilling" ability and will be sampeling as they drill. When I invested in the shallow land based wells I was in before, they collected samples all day long as they drilled and the geologist made a trip to the well site to evaluate them. They brought in logging equipment after total depth was reached and then started their evaluation.
Current state of the art equipment could send the same information to a geologist team in Houston or Nigeria or Sweeden while the well is still in progress, not after they are done. That alone would cut 30-45 days out of the evaluation process.
Petemantx posted this question this morning. Since there is no stock news or leaks from the rigs to discuss, can someone with deep water experiance post a reply? What do they do with these test wells till the development starts. At Acpo they drilled the test well in 2000 and must have started developing the field based on a plan in 2007 or 2008 because they drilled 43 wells 22 oil wells 20 water injection wells and one gas injection well that is putting about 1/3 of the daily gas production back into the formation. If they used one drill ship that would take somewhere in the neighborhood of four years?
Do they just cap the well off when they are done testing,. since they may not know exactly what their development plan is?
Walldog, I think your right, there wasn't two derricks but there is two assembly areas. To let them drill faster & more efficently.
midtier, only one stockholder has to decide to sell, if he does, it sells if he doesn't it don't matter what the rest want, it doesn't sell. 51% is control
Oil head, I think your reading the wrong drilling information. There are no piers used in this deep of water, the Sedco 702 and Deepwater Pathfinder have dynamic positioning and keep themselves in place with their positioning system. Both these rigs are in 5000' + water and have been drilling since 8/25 and 8/27.
Jake1279, I have not sold any yet and have much less than 200,000. I fully intend to sell some once the price moves up to $3 I will think about selling about 20% and get all my capital back & just be gambeling with profit money. Ive done it twice before and had planned on doing it with adair but the price collapsed while I was waiting for a few cents more per share.
I may rethink this, based upon what the wells look like, this stock has the most upside potential of any I have put my mad money in.
The NSAI numbers are just that, numbers. Untill the rigs finish drilling and the companies have time to evaluate their finds I don't expect any great change in SP. I think there has to be proven oil in order to get any real notice. The friend who started talking about ERHE in 2000-2002 has had big anouncements many times & they are finally comming true, they are drilling and we will find out what is down there for sure.
Red, my understanding, which may be way wrong, is they use one derick to position the new pipe on the rotary table while the next section is being assembled on the other derick. Essentially they trade back and forth adding to the drill string, with two dericks they are twice as fast.
I picked this up from an article about the deepwater pathfinder someone had posted last month
thanks john
To all you posters with deep water drilling Knowledge when they say they are drilling Bomu-1 in 1646 meters of water (about 5400')to a depth of 3536 meters (11,600') subsea. are they talking about a total depth of 17,000' water and below seabed or only 11,600' 5400' of water and 6,200' below the seabed. I am still having a problem determining how deep they are drilling based upon the way they state the conditions.
I really don't know my information came from a poster in early August(?)who had a Rigzone account. I guess the original posession of the 702 was to happen in July, but it was still working on a Shell well in early august
emdyal, Senopec had a deal with shell to get the sedco 702 for one well, then it goes back to a field shell owns, I think north of the JDZ
Sorry, lovemelongtime, I am not buying or selling. I have all the money tied up in ERHE that I am going to have available before the hoped for price run up. If you read the message I was responding to didn't think we would hear any news on the current wells, I did and explained why I thought we would. To invest more I would have to sell something and lock in a loss I think will come back or take a gain on something I think will go higher. I will be kicking myself by year end I couldn't scrape up a couple of thousand more, but right now I am at the limit of my risk. I have owned ERHE since 2005-2006 when Chevron anounced they were drilling in block one but just found out about this board in June & you don't have to register to read, only to post.
RKT989, it might be interesting to note that Akpo was discovered in 2000 and only started to produce this year, 2009. I guess it takes a while to drill 44 wells and build a 2,000,000 barrel floating production, storage and offloading facility.
dat_51or, I think we will get some news, not very reviealing because they will want to PR the Deepwater Pathfinder moving to Limba in block 3. The Sedco 702 is going back to another company and its movement will be on Rigzone so I expect some non-commital PR then also. Something on the order of we found hydrocarbons and took readings and samples which we are evaluating.
OBO-1 announced how many foot of net pay they encountered, but I don't expect there will be any real news for a few weeks or a couple of months, depending on what they do find. The best or worst news should come out faster, the longer it takes the more questionable the findings.
Petemantx, the real reason may be they are not sure when they want to have the meeting. I am sure they will want to have as much information on the three wells, at least, as possiable before they have to face shareholders. You wouldn't want to have a shareholder meeting before addax and Sinopec released the results of drilling.
Also with only five employees you can bet somebody is watching everything that is going on on two ships (& reporting to SEO)having insider information is not il-leagal, though trading on it is.
If the information on Kina is good, doesn't that mean there will be more testing? Based upon my experence with small land wells dry holes were prety fastly pluged and the site restored. If they found anything it ment more time testing etc & the promoter did not worry about the cost because the cost were recoverable. On a dry hole we had put in all we were going to pay & cost overruns came out of the promoters profit, or pocket, if need be. These drill crews are much more expensive than portable rigs used to drill these shallow wells.
I have also come up with a new theory, SEO's connections may be valuable enough Senopec does not want him out. If they buy ERHE it is just the company SEO used to control & he already has his money. If he is still in he will use all his influence to benifit ERHE and at the same time Addax and Senopec.
Sneak, per google Akpo was discovered in 2000, in 2009 they are producing 225,000 barrels per day, the total field is scheduled for 22 oil wells 20 water injection wells and two gas injection wells. About 1/3 of the daily gas is injected back into the formation. Proven and probabil reserves are 620 million barrels.
If Kina is bigger we are golden.
Nodak, I saw the Bomu information and thought they were drilling in 1600 meters + about, 5400 feet and I interpeted what they said as drilling 10,000 to 11,000 ft below sea floor. Am I missreading the total depth.
I have never saw the Kina well total depth, but the water was 6300 to 6500' & the Deepwater Pathfinder is rated for 10,000' water and 30,000' drilling depth. I was reading that as up to 10,000' of water and 30,000' below sea floor. Do they measure drilling depth from the ship or from the sea floor?
Curious, I may have totally misread the total well depth.
Petemantx, I expect some kind of anouncement when drilling is complete, I do not expect the anouncement to tell us very much, more the type of "we found hydrocarbons and collected samples we will use to evaluate the data we collected while drilling. We will make an anouncement of our finding when we have copmleted ouranalysis."
The little oil wells I invested in in Southern and western illinois were owned by a hand full of investors, on the first well there was a cluster of 1/64 owners where I lived. We were able to get a update on the well daily from the geologists report by phone. They were always telling us that the information was not complete, but we knew we had oil baring layers & about how much, but not if it would make a well.
It was not a publically traded stock & with a small number of investors you can make sure everyone hears the same info and at least partially understands it. The current operator does not want to be sued by investors who might trade on sketchy or missleading information.
I think the original report on OBO-1 said they "found hydrocarbons and recovered mineral and fluid samples that would be incorporated into the knowledge about the formation." Not exact words but close.
I think it would be hard for them not to have found some hydrocarbons as deep as they should be in that formation. The question is how much and is it commercial quanity.
Marc's comments from the JDZ people indicate they found something & I would interpet their comments as being good, but how good?