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I am not going to permit my Excitement to be turned into Frustration by the naysayers on this Board.
We can all write a paragrpah on the current projects being pursued by this company. Those projects and the pictures of wells, rigs, and working people did not exist on this board a year ago.
Reid is clearly building an oil company and surrounding himself with a talented bunch of players, both domestically and internationally.
Asking qustions is easy, getting answers is always harder. But Reid knows who to ask and can apparently get a deal "done". Yes, I am waiting on some results, I'm waiting for some information, for the other foot to drop, but I made my bet, I made my bed, and I'm gonna sleep in it, with a smile. This is my dream come true, so don't wake me up, I love this company and I anticipate good news soon. Oiljob
Does somebody else know how to land a million acre concession in Belize, does somebody else know Jimmie Jones, does somebody else on this Board know the location of another Madeley well. Exercise some vision ... or at least focus on the material directly before your eyes. Stop beating this company to death. It's working ... and its winning.
Nobody will be suggesting that we overpaid for the Shelby County leases after we drop two more drills down to the Fredricksburg Zone. The first two pads will produce 8 more wells. And if we drill the laterals then they will all be producing more than their current equivalents on the property.
People are comparing prices paid with what people pay for bare ground unproven oil leases (just to hold the property hoping somebody else will drill and prove the property's value) with what we bought, which was a known quantity (The Madeley), a producing well, which will pay for itself without one dime of additional money being paid. Jimmie Jones did the work, and deserved to be paid for both his risk, his vision ans his sweat. And I bet he has a little more to offer this company than most of the talking heads on this board. I'm sure we haven't heard the last of good ole Jimmie.
Apples and Oranges. Location, location, location. I'll take the producer any day of the week. Oiljob
Good Job Jimmie Jones ... got anymore bright ideas, I'm listening.
MAYBE THERE ARE SOME ROUGHNECKS WHO ARE ACTUALLY WORKING ON OUR RIGS THAT COULD POST ON THIS BOARD AND LET US KNOW HOW THINGS ARE GOING??? NEWS FROM THE RIGS. YOU COULD CALL YOURSELF "RIGMAN"; A ROUGHNECK SOMESHERE IN TEXAS, ABLE TO DRILL DEEP HOLES IN A SINGLE DAY, MOVE LARGE BOULDERS WITH A FLICK OF HIS WRIST, AND ABLE TO SMELL OIL AT A DISTANCE OF TEN MILES.
POST HERE AND I'LL BE PROUD OF YOU. OILJOB
PS: WE'D JUST LIKE TO KNOW WHAT IS GOING ON.
1.5 Million "phantom" shares? I don't think so, not with this much oil coming out of the ground. Oiljob
P.S. : And the 5000 share buys, are those phantom too?
How does anybody sell a share without somebody else buying it? Oiljob
P.S.: Even if it's just market manipulation (MM's) then somebody is pitching the swap and somebody is catching the swap.
I'm reading between the lines, but, ...... it would appear that Jimmie Jones is gonna pull this company up by its boot straps; kicking and screaming if need be, with the hedge funds be damned, whether we like it or not.
Well, I, for one, like it a lot.
God Bless Jimmie Jones. He can eat dinner at my house any day of the week, Oiljob
And four pads is just the beginning.
And someday, somebody is gonna give the green light for a really deep well on the Shelby County property. That is where the shale is.
Anybody know how many shares Jimmy owns?? I presume he has a vested interest.
Just for a little perspective, we did not announce the closure of the Shelby County deal until 7-31-2012, and as I recall it said we were closing that week, so that would be sometime in August.
Is somebody suggesting we're suppose to have East Texas oil sales in July. Plus, August production was largley delayed (in East Texas) by the gas pipeline hook-up.
Hopefully by the end of September we'll have some West Texas sales and some MCComas sales. I'll cross my fingers. Oiljob
I wonder how things will be a year from now.
Will I be disappointed or overjoyed?
I wonder how deep the San Juan No. 1 well is now; when will Schlumberger commence its work, I wonder where the Wilson rig is and when I will hear about it drilling-away looking for oil; I wonder how the drilling programs in West Texas are doing and McComas too; and then I think that Bull is hunkered down in New Orleans with nothing now to do.
Who will be the president in January 2013, and how much oil will we have sold by then, will the Tigers announce an offshore drilling survey, will new fields in Belize be prepped for drilling, will the GOB finally acknowledge we have an economical sustainable Stann Creek Field to tap and bring on line, will Belize build an oil refinery, and on and on and on.
I wonder if Andrew Reid will ever be given any credit for all the hard work he has done (and I wonder if he's on vacation because I'm not getting nearly enough news lately, lol), and will the minority investors in this company be rewarded for their patience.
Have a good day everyone ... and, I don't wonder how you are all doing because you post here everyday, and I read this blog like it's an extension of my own family, some of you I admire and others ,,,,, well ..... like I said, much like any family. Oiljob
P.S.: If you have actually read this blog all the way to this point, then your life is truly vacuous .... lol.lololololololol
Just keeping the faith.
Hey Bull, it's a CAT-I now, ...time to move to higher ground. Get out of New Orleans before it floods. Good luck. Oiljob
A year from now I could own part of a company with 10 pads and 10 wells drilled to the Fredricksburg Zone, with laterals (i.e. 10 more Madeleys), not to mention 30 more wells to three other producing zones with laterals. Now that should confuse the accounting a little . And that is just east Texas.
Tell me what is happening a month from now including West Texas, McComas and Belize, and the bean counters will be up all night.
Drill, produce, sell ... rinse and repeat. Oiljob
P.S.: I think we already have the offshore partner, so I'm gonna stand and cheer, and yell GO TECO.
$1,000,000,000.00 , $2,000,000,000.00 , $3,000,000,000.0 (market cap) hmmm, a new mid-tier oil company has been born.
My gut tells me everyone is piling up their cheap shares before some big news is released. I've been pointing this out all week, asian brokers (Tigers), caribbean brokers (GOB) and now management.
When did the Tigers amass a large enough position in this company to warrant a seat on the Board? Invisible accumulation (over what period of time?) while the shorts were actively stabbing themselves in the heart. No ... it requires a different explanation. I'll leave that answer to the few knowledgable experts I respect on this Board. Please respond.
I'll guarantee the pps will rise substantially the day we spud in the first pad in Shelby County. I question if the lateral will be drilled by that point in time. Oiljob
P.S: I certainly don't see any "dumping" going on ... the daily volume recently has typically been abyssmal. Longs and management are holding tightly onto their shares ... as am I.
Am I rich yet??? Oiljob
It is not possible to be juggling this many balls without producing reportable newsworthy stories and events. At the end of the day we will become cognizant that we are all looking at the wrong information.
This is a Tiger induced news blackout. The drilling programs are proceeding silently forward, with as little background noise as possible while the Tigers slowly accumulate more and more shares. I'd like to know how much of the stock activity is being generated offshore, and through offshore Asian brokers versus offshore Carribean brokers.
At some point the news dam will break and the opportunity to accumulate cheap shares will be over once and for all. Treaty can only keep a lid on events for so long and then they will be obligated to file 8Ks, like the one we finally saw today announcing an increase in the authorized share count. We've known about this for about two weeks.
It's a pretty interesting paradigm. The accumulation of wealth in the 21st century is totally different that it was 50 years ago. The asian element changes everything. And if we go back on a gold standard, or adopt a new second metallic based domestic currency, then the global financial will change once again. And hard resource assets owned in American dollars will truly be worth their weight in gold.
I like the fact that people are looking across the state line to assess the value of the Madeley property. We need to use that same intelligent couriosity and perspective to assess what is actually going on with our stock price right now.
This blog is of course entirely speculative and without any basis in fact, a usual I'm just thinking out loud. Oiljob
I'd bet on another Shelby County like deal, before I would listen to the bashers on this board. Reid can pull one out of his pocket whenever he really needs one. We're not there yet.
The real drilling and new production are just around the corner; why all the impatience ... we've been here before many times.
This time next year this investment is going to make me look like a raving genius. I'm comfortable, and confidant that this is the real deal and the company probably hit a pot hole or two on the way to the next press release. So what .. we have a good team and they can negotiate the bumps in the road.
I think Reid has two or three more Shelby-like projects in the works (in his back pocket) at all times... we have oil coming out of the ground everyday now, we are a REAL oil company; time will tell if we are a real international oil company, but everything actually looks pretty good on that front too, we just don't control all the pieces on the Board down in Belize. I'd like to know how many shares of TECO are now owned by GOB officials and employees. We certainly don't seem to be the bad-boys-of-Belize anymore. How many share does Mr. Cho now own? .. the answer to that question would certainly provide some needed "clarity" would it not ..hahahha ?
The bottom line here is most shareholders would like a better time line, a lttle more transparency on matters within our domestic sphere of influence. But don't tell me everyone won't get very excited the day we start drilling the lateral in Shelby County, the day we spud in our first new pad in Shelby County, the day we announce we are drilling deeper looking for the Haynesville Shale ... there are definately good days ahead, and my horizon puts all this and a lot of international Treaty news on a horizon of less than a year.
Good night everyone, and sweet dreams. Oiljob
The Oiljob Oil and Gas Dictionary defines "volume" as humungous quantities of oil and gas coming out of the ground. It also defines "clarity" as a visual attribute which is lost during a blow-out ... sometimes you cannot see your hand in front of your face, indeed the world can look black.
I agree ... we need more volume and just a little more hilarity, I mean clarity. I am also going to walk towards the light. Have a good day everyone.
And, I'm just kicking back waiting for some "gusher" news. Oiljob
Solid fundamental news coupled with new long term production reports equals a huge increase in my portfolio value. It's pretty simple.
Have a good weekend everybody, maybe we'll see some updates on Facebook over the weekend.
I'd like to see next week, Monday, start out with a blockbuster PR. Oiljob
P.S. Ohhh where ohh where is my press release please, oh where oh where can it be, west texas, east texas or little Belize, ohh where ohh where can it be. ...... lol
What a colossal train wreck. This is what happens when your "engineers" don't know how to run the caboose, much less the engine. Oiljob
Couldn't they just build one rig. Build it and they will come. Do one thing right and the rest will fall into place. Focus on one project and do one little thing right. ...... Man what a disappointment.
A year from now we'll be comparing against this quarterly and looking pretty spiffy. I can hardly wait. Oiljob
Chit: The word "buyout" is not part of my vocabulary, and hopefully it is repugnant to Mr. Reid as well.
I see you are keeping up with your research. That's why I like reading your posts, we go to many of the same websites. lol Oiljob
P.S. And that is my second and last message for the day. Until tomorrow everyone.
I'll get to the point. I'd really like some fundamental news. We have two drilling programs in West Texas, the McComas in central Texas, a lateral to drill in Shelby, two pads and 8 initial wells to drill in Shelby, an unknown Ellora lease which I presume is positioned for a deep shale wildcat, rigs awol, and unknown progress in Belize, San Juan #2, San Juan #1, plus six addional Belize wells I presume planned to delineate the size of the Stann Creek Field, unknown Paradise plans, unknown offshore plans, unknown relationships with Malaysian investors (who I'm told have been quietly coming in and assuming a position in the our market) (was that all the shorting we saw over the last two months.) I don't know, maybe some NEWS would help clear the dust out of the room; then I could get some sleep too. SNOOZE. you know.
Actually we've been given a lot of news lately and we all have some indigestion tying to read between the lines, the PRs don't answer all our questions, but they certainly give us food for thought.
I've also been thinking about the FTD discussions on this Board. Now all I know about FTD's is a lot of fuss is being made over them; however, it seems to me if we are actualy dealing with manipulation then the MMs involved in this felonious actiivity could simply agree (conspire) to swap large blocks of shares, back and forth, week after week, never deliver, and never call for delivery. The trades are posted in bad faith without any intention to ever deliver. Simple market manipulation; and without a delivery then our company books would never reflect the assumption of a new position or the size of their investment. You could declare a dividend or a stock split and still never solve the problem. (Thre goes my Oiljob Plan) The share swapping would simply go on ad infinitum until the MM goes broke because he's not actually making any money, or the IRS audits his books, or the SEC shuts them down for felonious stock manipulation.
I'm happy to sit here and snooze at a nickel and wait for the good news, which I know must come, because (I know) we can drill literally dozens of oil and gas wells into the Fredricksburg Zone (Shelby County) and become wealthy. However, I also believe the Tigers are hunting larger game. The hunt is on, the table is being set, and the dinner bell will ring real soon.
Nothing to be done with the MMs. We can't stop the manipulation, but if the company is solid I think the just go away looking for weaker prey. It kind of a weakest link game. Oiljob
To use a baseball metaphor: Build it and they will come. We can build storage tanks in Belize faster than we can drill oil our wells and develope our new field. I have heard nothing to make be doubt that good news is coming. If I were a short I'd be cold to the bone. In the meantime I'm still planning on drinking my beer on the sands of Belize.
Some people here think this is the race between the tortoise and the hare, and they can't figure out which one we are. Well it is not that race... it is just the oil business as usual. We have lots of partners, and people will line up to build tanks and drive our oil to market .. we just need to start pumping some oil, and I still think the national debt in Belize is the major stumbling block ... and the negotiations are apparently close to being resolved.
Get my pads built in east Texas and spud in.... I know where we have lots of oil and gas ... and we haven't even looked at the deeper lithology. East Texas is a bonanza ... nothing is going to stop this company .. and I don't believe Mr. Reid wants to do anything other than build the next great mid-tier oil company in America. .... Oiljob
P.S.: And if you don't believe this post then just look at the picture of that pretty brand new christmas tree at the top of this message board. It looks like an oil well to me ...... lol
If I were to get on Google Maps, how would I locate the Madeley leasehold? What is the closest town, and what is the nearest road to our leasehold? Does anyone have aerial directions to the property? Oiljob
I thank you prospectively for your response.
P.S.: How often does Google refresh its satellite photos?
I like your analysis Nimble.
I'm hoping this is a new 800lb. gorilla (new money, new blood) arriving on our trading pit, and not a short. That would be nice. Oiljob
P.S. Is anyone else having trouble with these I-Hub charts; I'm pulling my hair out. Either they don't move, the chart fails to match the quote, or the detailed chart needs to be "paged through" to "find" a chart that seems to match the quote and the message board chart (if the message board chart is even working). Very weird.
LOL Slow Ranger, for the most part I try to keep all these thoughts to myself, but every once in a while I permit myself to muse. So many questions, which is not to say I haven't already recieved a lot of answers and a lot of recent good news; I'm just "wondering" (out-loud), and possibly one of the brainiacs on this Board (the number of which I am constantly impressed by; there is no dirth of talent and education and professional O&G experience posting to this Board) might have one of my answers.
Long and Strong. Oiljob
P.S. I've been smiling a lot lately also, despite the premutations with the price of our stock, which DTL is clearly convincing me and everyone with a brain is in fact manipulation.
For all the Shorts: Live in the frying pan, plan on getting fried with the eggs. One can only hope.
I refuse to look west for our salvation. East Texas was the surprise PR; it was channeled to us out of Rampant Leon. I presume there is more channeling in our future. Ergo, I'm gonna bet our next big surprise comes right out our home base in Louisiana.
Also, I've been wondering about the structure put in place when the Tigers decided to invest. I see no evidence that they went into the market place and bought 10 million dollars worth of stock; but I do see that we just authorized a new tranche of stock (250,000,000) to be issued. If those shares have been issued then major dilution has occurred. The money for the east Texas acquisition came from somewhere (we're not told where) but I must assume it's the Malaysian, money. Did they get common stock and warrants; what did we give away for our cash position. I'm sure it was a fair deal and accomplished at arms length but I do not have answers to these questions. (There is also the possiblility that the new shares represent some kind of poison pill, to prevent a hostile take-over, or if the company feels thaqt the equity of our shares is actually going to rise sharply, then this is a huge Treasury position that has been put in place for future acquistions; more infomation is needed to properly analyze this quandery).
I've also been wondering wheather we have more old decrepit wells drilled on the east Texas leaseholds. I was surprised when I heard about the Lakeshore and the injection well (which has a Madeley name) and nobody seems too sure which well it was that blew out and got filled with cement back up to the Saratoga Zone.
I would also like to know where Wilson is!!! I have speculated, but I have heard nothing about McComas for some time now, though I personally believe that is where Wilson is at the present time. And though I have spoken with Mike Mulshine in the last 7 days, I dinn't discuss all these questions with him and he seemed in a hurry because I called so late in the day; though he made it very clear that he owns XXXXX number of shares, which even at $.05 makes him a millionaire. Next question, where did he get his shares, did he buy them or were they part of his compensation??? I guess some things are really none of my business.
I could keep thinking out loud, but to be honest I'm happy with our progress, oil does not come out of the ground all by itself, it takes money to make money, and Andrew Reid so far has demonstrated he's both a good captain and possesses some very far thinking friends. One method of investment is to follow the people who make you money. I'm currently following Andrew Reid. If he pulls this off he gets the Oil Baron Trophy for the year. And, if for any reason Treaty did get bought-out I'd immediately e-mail Andrew and ask him the name of his next 6 projects and how could I possibly get in on the ground floor. Buying out Treaty does not buy out Rampant Leon. We could repeat this operation again and again domestically, only with the money we make off of Treaty nobody will be starting from scratch again. That's not such a bad prospect.
I've been around since we were building little black boxes making hydrogen (where is that box; I'd like to play around with that), but I'm getting older and want to retire so, ANDREW (lol), don't make me wait too long. Oiljob
P.S. In my heart of hearts I'd like to see Mr. Reid build the next real major oil company, from scratch right under Obama's nose. When we make some money I'm gonna thank Mr. Reid and all his friends, not the federal or state government; not even the government in Belize.
Lots of little briquetttes coming soonout of Ambatovy. The annual earnings comparisons will be easy to beat next year becasue the depressed prices recently received and reviewed in most recent quarterly report. I continue to believe this is the only true Cuban play on the market. Oiljob. The second half of this year will be very important. Lots of news events are expected.
It's nice to know there is one thing this company is not "short" on..... Future Good News. Oiljob
I'm gonna stick some of these good news "shorts" in my pipe and Smoke-Em. Laughing All the Way to the Bank. Oiljob
Well I got the news I was looking for, thank you Mr. Reid. I must assume that management is reading this board.
Great job Treaty and keep up the good work.
And if one more poster uses the word "acquisition" referring to Treaty as the target I'm gonna report them to Treaty gestapo. lol
Oiljob
PS: You're doing a good job Chit ... those shoes look pretty good on you... mod.
P.S.S.: I also get a nice warm fuzzy feeling every time I think about the Princess/Treaty offshore portion of our Belize concession (1,800,000 untapped undeveloped acres of immense potential), there could be a real elephant out there, like low hanging fruit, just waiting for the picking. You have to believe modern geophysics is one of the wonders of our lifetime.
The most important thing I want to read right now is that we have completed the purchase of the East Texas leaseholds and that our funding is in place to spud in two more wells to the Fredricksburg Zone with laterals being contemplated. Oiljob
P.S. I continue to believe that the superfund or bond negotiations have yet to be completed in Belize and continue to be a drag on any news coming out of Belize.
P.S.S: I would imagine that if our crews are drilling the East Texas business then our Wilson rig will be utilized there, however it seems we rented a local rig and crew for the work performed on the Chumley so far. If the McComas is being drilled as we speak, it's only a 1900' well, and they could be tuning the Wilson in central Texas, (Taylor County) on the Mc Comas property. I was gonna say "dry run" but that didn't sound too good . lol
Just got back from Las Vegas (my son's basketball tournament, Adidas 64, 16 and under. It's been a while since I was in that town and all the slots paid for me. It was a great trip. Even let Joe drive part of the way home. Learner's driving permit and all. Teenagers, kind of like Treaty, require a lot of patience. So if my luck holds I'm looking foward to a great week with the stock,; that would only be fitting.
OK, I've got my shares in a jar ... now do I use a pulley or just heave them up there by that bee hive???
Now a I got a bear on one side of the tree and a bull on the other, I'm not sure which is gonna kill me first :) ....
What do I do when I want my shares back???
I think this is financial advise from Mammoth Lakes, CA ... ummmmm... isnt that where a town went bankrupt.
I've decided I'll do nothing and wait for good news ... sip some Jack Daniels on the back porch and watch the animals run around in the pasture ...
By the way, my pasture is a little smaller now that I have an oil well pumping on the back 40. Oiljob
I'm still holding my jar. I'm gonna be holding it for a while ... sip, sip
Super-low volume... the bears can smell the meat but are afraid to stick their noses in the trap.... longs are staying long .... ergo the $$$$ guys must know news is just around the corner and are sitting on the side-lines. waiting... waiting ... waiting
My guess is West Texas news tomarrow .. wait and see ... Oiljob
The easyist thing to do is to simply announce that the Board of Directors has authorized a buy-back program. As the petro dollars flow into the bank (and the oil production increases) the company can be ready to pounce and protect the share price against any bear run on the stock. They don't need to spend one dollar on the progream, they just need to announce that they possess authority to pursue this action.
It would really cure the problem if they announced a buy-back coupled a share retirment plan, and actually executed that plan. That would increase my share equity fast.
After the shorts move out, we can announce a share split (2 for 1 forward split) down the road. That is the Oiljob Plan.
If you can improve upon it feel free to post. Oiljob
I'll know when the elephants arrive because it will be reflected in the volume. They have not arrived yet. lol
In the meantime I appreciate all the input, insight, and information everyone can provide; and if you have telephone conversations and wish to share them with the rest of us I appreciate that information too.
Reputations are built over time. Eventually everyone's mask will be ripped off and the truth revealed. So sit back and enjoy the ride. I'll know who the longs are when I get to the party. Oiljob
I have mentioned the Haynesville, but I never said the company should commence drilling this well anytime soon. It is simply one of the many Treaty opportunities presented by virtue of our acquisition of the Shelby County leaseholds.
Concerning Shelby County, my emphasis has been on completing the two new well pads and spudding in with the Fredricksburg Zone as our primary target with the initial two wells. I am presuming laterals and fracking with each of the proposed 8 wells, but certainly with the Fredricksburg wells, depending on how the lateral turns out with the current Madeley well.
I'm sure Treaty has a thick project portfolio that will eventually catch everyone's eye. This is my "conjecture" with the our recent discovery of the company's relationship with Rampant Leon. This company was put together for the primary purpose of pursuing exploration opportunities in Louisiana (salt dome properties and Haynesville Shale prospects, competing with Devon Energy and Chesapeake Energy,).
In short, Shelby makes everything possible, and soon the synergy of McComas, West Texas, and Belize will add to the excitement and our bottom line production. I will be giddy when we release our offshore plans, our refinery plans, or acquisition plans (think BNE) and our Louisiiana portfolio plans. Just guessing . Oiljob
P.S.: And I remain curious about the Ellora Farm-Out contract. I'd like to know the details.
Just Curious: Where is the Ellora Lease in relation to the Chumley Lease, and what are the terms and conditions of the Ellora Farm-Out Agreement.
I presume it requires the lessee to drill a particular well location to a particular depth by a particular date? Oiljob
Anybody know???
Here is a little drilling article I ripped off the net suggesting current day rates for deep gas plays could be around $20,000 to $25,000 per day. The well would probably take about 3 weeks to drill and case; we used to move the rig, set-up, spud-in and drill 20,000 in Bakersfield (actually west of the Grapvine and south of Taft, but we all lived in Bakersfield) in about a month, back in the 70's, when I was a roughneck (piperacker mostly, occassional tong man) Oiljob
Ask yourself how many days you're going to need the rig and multiply by $25,000.00. I also think Baker Hughes keeps a tally of rig counts and day rates nationwide, if you wish to give them a call.
I suppose a long lateral and frack job (plus casing and cement) would add to the price as well, so triple or quadruple the day rate for the price of the rig to get it on line. Just a guess.
Remember we re paying about a $250,000 pper well, and we are only tapping zones less than 4000' down. And I don't know if Reid's cost estimates include the 1000' laterals, I hope they do.
"CATEGORIZED | 2012, Features, Global and Regional Markets, May/JuneThe great migration to wet plays
Posted on 24 April 2012
Share ThisSelect Language??Liquids-rich US shales shine as industry sweet spot
Nomac Drilling’s Rig 245 drills well Gribi 1-9-1 3H in Tuscarawas County, Ohio. Photo courtesy of Chesapeake Energy Corp
By Katie Mazerov, contributing editor
The paradigm has shifted. US land rigs that just two years ago were at work in prolific shale gas plays are on the move, delivering an oil and liquids boom that has yet to be fully quantified. Whatever trends are occurring globally, US shales are the big story for 2012, driven by new play discoveries, technology advances and favorable pricing. Drilling contractors are seeing steady and rising dayrates and high utilization as operators shift their focus from the dry gas basins and set their sights on liquids-rich regions, such as the Bakken, Eagle Ford and the Niobrara, along with emerging plays believed to hold huge reserves.
“There’s a boom going on,” said professor Jeremy Boak, director of the Center for Oil Shale Technology and Research and chair of the Oil Shale Committee’s Energy Minerals Division at the Colorado School of Mines. “There are three or four significant oil-producing plays in the US today and a huge amount of excitement, with companies moving rigs as fast as they can. While gas is much easier to get out of impermeable rock, the technology in multi-stage fracturing has advanced to the point that we can now produce oil and wet gas in these areas. In many regions, such as the Bakken, the best-producing horizons are in silty rocks, siltstones and dolomites that are interbedded in the shale.”
Since the industry cracked the shale oil code in the Bakken in 1999, production in the play has increased 55% per year, a phenomenal growth rate for a new resource, Dr Boak noted. “Potential for the Bakken is predicted to reach one million bbls per day by 2019, just 20 years after production started. It took the US 65 years to reach that number in conventional oil production and 40 years for the Canadian oil sands to achieve that.”
Meanwhile, there is a debate among some geologists over what to call the oil produced from shale. As the Bakken play developed, the industry called it shale oil, a term used since the early 1900s to refer to organic-rich shale that requires heating to produce oil. However, Dr Boak prefers to call shale containing liquid hydrocarbons “oil-bearing shale,” and the product, “shale-hosted oil.”
Big E Drilling’s Rig #1 operates for Rosseta Resources in the Eagle Ford.
Aside from increased production in the Eagle Ford and Niobrara plays, operators such as Chesapeake Energy are ramping up activity in the newer hot plays, including the Utica, underlying much of eastern Ohio, and the Mississippi Lime, or Mississippi Chat, spanning across northern Oklahoma and southern Kansas. The Tuscaloosa Marine play, a deep (10,000 to 15,000 ft) formation in central Louisiana and southwest Mississippi is believed to hold seven billion bbls of recoverable oil, an estimate made as far back as 1997, Dr Boak noted.
Despite concerns about hydrogen sulfide (sour gas) and high levels of produced water, particularly in the Tuscaloosa, there are no signs of a slowdown, he said. “Oil prices right now are high enough that an operator can spend a good deal of money going after the oil.”
Rates Steady and Rising
Nomac Drilling, an affiliate of Chesapeake Energy, has 113 marketable rigs with 110 active in the Eagle Ford, the Mid-Continent (including the Granite Wash, Cleveland, Tonkawa and Mississippi Lime), the Barnett, the Haynesville, the Bakken, the Marcellus and the Utica. In the Utica, Chesapeake plans to increase the rig count to 20 by year-end and to 30 by year-end 2014.
“Like most contractors, we are experiencing migration from dry gas plays to wet plays,” said Jay Minmier, Nomac president. “Fortunately, due to our relationship with Chesapeake, these changes do not impact Nomac’s utilization, only its deployments.”
Crews on Nomac Rig 245 work to drill well Gribi 1-9-1 3H in Tuscarawas County, Ohio.
Mr Minmier reports that rig rates have remained favorably steady since Q3 2011 and currently range from $18,500 in the Barnett to $29,750 in the Bakken. “Nomac’s rates are market-based so we aren’t immune to price fluctuations. We do believe that, to the extent wet plays can absorb the capacity leaving the dry plays, overall pricing will remain stable, although weakness is expected in certain areas like the Barnett and Haynesville.”
All of Nomac’s marketable rigs are either working or undergoing upgrades for upcoming jobs. “Our utilization has historically stayed between 95% and 100%, and we will be fully employed again once the upgrades are fielded,” Mr Minmier said. Twelve new rigs are slated for delivery through April 2013, with two 1,500-hp rigs for oil drilling in the Powder River, Wyo., region and 10 1,200-hp rigs for the Utica. Dual-fuel systems are being added to the majority of its fleet to allow the rigs to run on compressed natural gas or liquefied natural gas, as well as diesel.
“Many of our existing rigs and all our newbuilds have walking systems to facilitate efficient, slot-to-slot moves on a single pad,” Mr Minmier said. “Our newest rigs also include certain innovations to reduce location-to-location move times. We are focusing heavily on mobilization times as this portion of the well manufacturing process has become much more visible due to faster drilling times.”
From a technology perspective, the company has not been limited on lateral lengths. “To the extent that some laterals are shorter than preferred, it is almost always a leasing issue,” he added.
Nomac is implementing an accelerated development program for drillers, directional drillers and rig managers aimed at reducing the time required to train competent rig leaders by 60% over traditional methods, Mr Minmier noted. The program is targeted to young, motivated professionals with no industry experience.
Big E Drilling has shifted its fleet from the Haynesville to the Eagle Ford play, a move president and CEO Lyle Eastham said was justified given the current pricing environment. “We decided to go where the liquids are,” Mr Eastham said. “There could conservatively be 10 to 15 years of drilling in the Eagle Ford. When we moved into the play three years ago, there were only 30 rigs. Now there are nearly 240 operating.”
Today, the company’s five rigs are all operating in the Eagle Ford, including one the company built 18 months ago.
A Precision Drilling Super-Triple (ST) 1200 rig moves to the next well on a pad in the Marcellus play. The self-moving rig can move with a full setback of tubulars.
“We have added a lot of automation equipment, including top drives, catwalks, blowout preventer lifts and rig walking systems, to our rigs, which have enhanced safety and efficiency and aided in the contracts we’ve been awarded,” Mr Eastham continued. The fleet is designed for horizontal and directional drilling at depths from 15,000 to 25,000 ft, with dayrates in the mid-$20,000s.
But he also gives considerable credit to the company’s stable work force. “All our pushers have a minimum 20 years of experience, and we have a lot of 30-year employees with little turnover. We keep our rigs busy, and run a safe, efficient operation.”
Walking the Walk
Newbuild activity is also healthy in North America, with many of the major companies ramping up their fleets with efficient, highly mobile rigs suited for shale wells and pad drilling. Calgary-based Precision Drilling delivered 18 new rigs in 2011 and has contracts on 33 more to be delivered by the end of 2012 in North America.
“These are state-of-the-art, tier one rigs that are equipped with pipe-handling systems and integrated top drives, and all run range three (45-ft) tubulars. They are designed with a small footprint in mind,” said Doug Evasiuk, senior vice president of sales and marketing, North America for Precision.
“Pad drilling continues to be attractive to operators wanting to minimize the environmental footprint, limit truck traffic and reduce move times,” he said. “All the major companies are building rigs that have the capability to walk from wellbore to wellbore to eliminate trucks. With our Canadian roots, we understand how to do that, especially for cold-weather environments. All our rigs going forward will have walking systems or the capability to accommodate them.”
Precision’s newbuilds for the US market include seven 1,200-hp rigs and 17 1,500-hp models. All are AC Super Triple rigs. For Canada, where wells are generally shallower, the bulk of the rigs are the Precision Super Single design. The Super Single rigs also run range three tubulars and have fully automated pipe-handling systems.
Nabors Drilling USA Rig 681 (above) and Rig B4 (left) are both working in the Bakken Shale of North Dakota. Rig 681 is under contract to XTO Energy while Rig B4 is working for Hess.
“In Canada, because we have a compressed drilling season and have to be very efficient, we’ve always been focused on highly mobile rigs,” Mr Evasiuk continued. “Over the years, technology has enabled operators to drill considerably faster. Wells now are taking far less time than they did in the past, meaning we’re moving a lot more than we once did. When we’re moving, we’re not drilling the well, and that translates to nonproductive time, which is costly for our customers.”
Dayrates have been solid, particularly in the liquid plays. Precision began shifting from the dry gas plays to the liquids last year, a trend that will continue, Mr Evasiuk said. The company’s large presence in the Haynesville has shrunk from the peak level of 26 rigs to just three. “There has been enough activity in the liquids plays to absorb rigs coming out of the dry gas markets.”
Rig B4
US utilization is above the industry average. Of the company’s 150 US rigs, 104 are operating in all the major plays, including the Bakken, Eagle Ford, West Texas, Mississippi Lime and Tuscaloosa. Precision has yet to enter the Utica but has been approached by operators in that region.
As the largest drilling contractor in Canada, Precision has operations in every major basin, notably the Cardium, Viking, Duvernay, Canadian Bakken, oil sands and heavy oil. Utilization in February was around 85% but has recently declined due to the spring “break-up,” which occurs late in Q1 and can carry into Q2. The thawing makes transporting equipment difficult. Traditionally, 35% to 40% of drilling activity in Canada occurs in the winter months.
From a technology standpoint, Mr Evasiuk believes the push for longer laterals will be achieved by further development of completion designs. “The industry has the capability to go out a lot farther, but it really becomes an economic decision by the operator to determine what the length of the horizontal section should be.”
Outside North America, Precision has two rigs operating in Villahermosa, Mexico, and three in Saudi Arabia. All are 3,000-hp rigs for deeper wells.
Increasing Automation
Nabors Drilling has seen an uptick in US land rig utilization, primarily in the 1,000- to 1,500-hp size being deployed in most of the shale plays, said Denny Smith, director of corporate development. “Overall, US land rig utilization is around 80%, but utilization is virtually 100% for our rigs in the highest demand window.” He sees dayrates averaging in the mid-$20,000s.
Commodity pricing is the key driver for the shifting market, a trend that began back in 2010. The weak gas price phenomenon is isolated to North America.
Nabors initially shifted several rigs from the Haynesville to the Eagle Ford. Two years ago, 58 Nabors rigs were working in the Haynesville; today there are 26. Along with a significant presence in the Eagle Ford and the Permian Basin, the company has several rigs in the Mississippi Lime, with plans to move two more from the Haynesville. The company also plans to move one or two additional 1,500- to 2,000-hp rigs into the deep Tuscaloosa play to go after gas liquids and oil, Mr Smith said.
Nabors Drilling’s Rig 109 is working for XTO Energy in the Bakken Shale, where Nabors remains the largest drilling contractor.
Additionally, Nabors remains the biggest drilling contractor in the Bakken. By the end of 2012, the company will have 76 rigs, including several newbuilds, in the play.
“The market will continue to be this way for awhile. Gas continues to be oversupplied, in part because of the associated gas that is being produced with the liquids and oil,” he continued. “There is a broad range of pricing right now. I think there is a lot of latitude for prices to even moderate some and still keep a pretty robust market. Our customers have indicated they would continue drilling if oil prices get as low as $75 to $80 in the Bakken and $60 to $65 in the Permian.”
Mr Smith said shale production, particularly horizontal drilling, has benefitted from an increase in pad drilling and major advances in downhole logging and real-time technologies. “I think there is going to be a trend toward more automation and remote control of the drilling processes that will spark further improvement in the next two to five years in rig efficiency, with increasing numbers of AC rigs featuring digital controls and automatic drillers.”
Through its wholly owned subsidiary, Canrig Drilling Technology, Nabors manufactures top drives and other rig systems and intelligent software technologies. At year-end 2011, the company had 119 AC rigs in the US, with 31 newbuilds planned this year. Most of the contracts are for the US market, but at least two have been designated for Canada and three for other markets. Outside the US, the market is recovering, with Nabors’ land rig count expected to increase from 116 at year-end 2011 to 130 by the end of 2012. The company saw peak activity during the seasonal Canadian market, with close to 50 rigs operating in the oil-rich Montney, Duvernay and Cardium plays, Saskatchewan, and the Horn River gas basin.
A lack of service infrastructure has led to low unconventional production in Australia. “If there is a rig operating, it will be for one well, and it will be extremely costly,” said Warrego Energy’s Dennis Donald. The company holds a permit for a block in the North Perth Basin, estimated to hold one of the world’s largest shale gas reserves.
There is more gas drilling in the Middle East, particularly Saudi Arabia. “We do the majority of the gas drilling in Saudi Arabia with very high-spec, 2,000-hp rigs with multiple blowout preventer stacks for the high-pressure wells,” Mr Smith said. Nabors also has 15 rigs in the Llanos Basin of Colombia and is drilling oil for two major operators in Russia.
An Anticipated Bonanza
But there is one area of the globe where drilling activity is at a near standstill. Despite favorable market conditions, a lack of service infrastructure is retarding progress.
Dayrates in Western Australia are at least 48% higher than US rates, despite gas prices that are $8-$10 (and rising) per gigajoule, considerably higher than North American prices, with acre lease costs of $500 or less, said Dennis Donald, a partner at Warrego Energy.
The company holds an unconditional permit to develop an 86-sq-mile block in the North Perth Basin, which is estimated to hold the fifth-largest reserve of shale gas in the world. The block contains the West Erregulla tight-gas field, which underlies the Kockatea shale play recently mapped by the US Energy Information Administration. The company plans to do seismic testing this year and begin drilling in early 2013.
Mr Donald cites lack of service infrastructure as the primary reason for the low unconventional production in the vast region, in part a function of the cannibalization of rigs being used for the vigorous coal seam gas activity in the eastern sector the country, thousands of miles away. “But with the government’s push for gas to replace diesel in Western Australia, operators have been given permission to utilize hydraulic fracturing to open up the gas shales,” Mr Donald said. “There eventually will come a tipping point, and when production does open up, this will be a massive market, and we will see a bonanza for rigs and fracturing.”
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OK, I've read this final page of today's posts, and the one point that really jumped out concerned the issue of "sustainability". Which is to say, we have now certified two wells for over 225 bopd, how long will the wells continue to pump. This is an issue which is unique to every field, and every county. It is researchable, but nobody on this board has done that research, the issue is raised as another scare tactic, as if the bopd were going to drop off next week not two years from now. Hearsay is not research.
I do know, if we drill down 10,000 to 13,000 feet we will probably hit the Haynesville Shale, which is about 300' thick. Just over the county line there are companies in Louisiana that have bought every square foot of the State to corner the market on the Haynseville Shale. That one formation streaches for hundreds of miles over many state lines, and the gas in that formation could run this country for a 100 years. The gas potential for these leases at depth is highly sustainable. we just need to drill a moderatley deep well and tap into the Haynesville Shale, its a mammoth resource sitting there waiting to be tapped. It needs to become part of our long range plan for the Shelby County leases.
I haven't had time to read the Board today, but one comment and calculation caught my eye the other day, presuming the Madeley lateral is drilled producing potentially 3-4 thousand barrels of oil per day. If that is true, then imagine two more Madeleys with laterals being drilled on the Chumley lease, also producing 3-4 thousand barrels of oil per day. And remember this is just the production from the deepest producing Chumley zone called the Fredrickburg Zone. There are actually 4 zones and we have only certified production from the lowest zone and the zone nearest to the surface. Ergo we could drill just two more wells to the Fredrickson, with laterals, and up our production to as much as 12,000 barrels per day, just from the Chumley lease. And we have three more leases with further access to the Fredrickson. East Texas is a goldmine potentially. Oiljob
What is the production potential from the two zones we still have not tapped or produced. I'll be very interested in the further developement and production from this suite of Shelby County leases..
Let me take another whack at an overview. The Chumley Lease appears to have both the Madeley and the Lakeside. I'm presuming the Lakeside is the well that blew out and got cemented back up to the the 1900' Saratoga Zone, but it was drilled down to 3380' just like the Madeley. I'm not told what zone is providing its 45 bopd production. If it is within 1200' of the Madeley then it would probably be from the Saratoga Zone, the zone nearest to the surface. Then we have the Madeley producing 195 bopd just from the Fredricksburg Zone, the deepest horizon. And, we intend to build 4 two acre pads, on which we will drill 8 more wells, to each of our 4 producing zones, the Saratoga, the Annona Chalk, the Tokio Chalk/Blossom Sand, and the Fredricksburg Limestone. That will be quite the revenue stream, and apparently the Tigers are paying for all this drilling and getting a seat on our Board.
Then we are awaiting news out of West Texas on the 1900' McComas well, with news due any day now. It will produce a revenue second stream.
Then we are awaiting news on a 12 well drilling program, quick wells, pre-paid, being drilled to only 500-600 feet. These will produce a third revenue stream and I am expecting news any hour of any day now.
Then we are drilling another 9 well West Texas drilling program, again pre-paid, drilling about 2300-3000 feet per well, and I'm expecting news any hour of any day on this program. It will create a fourth revenue stream.
And finally we are awaiting news out of Belize on the results of the San Juan #1 and #2, with the help of Schlumberger and Tucker Drilling Co., I presume we will achieve oil production, and a fifth revenue stream; with six more wells planned to determine the size of this field. I do not yet know the size or the spacing requirements in Belize, but we could have a maximum of 8 wells as things stand. Plus we are commencing the preparation of drill pads on two more fields and gearing up to explore another 1,000,000 concession (the Paradise) with our new Princess partners, who apparently have deep pcokets too.
The shorts "could" get bad news every day for the next month, and at some point must toss in the towel. That is why I'm not flipping my stock and creating taxable events. I'm long, strong, and betting on getting rich, anybody who wants to buy in at these levels is making a well calculated short term gamble on near term wealth production. I'll be attending the "parties" and will work on getting my passport re-issued today.
I have a 17 year old boy who needs a trip to a Belize, so he can better appreciate the blessings he possesses here in the good old United States. So that is two more passports I'll need because their is no way my wife will let me go alone ... tell me how Bull gets all those business trips, I need to know what message he is leeaving on the phone machine at home so the locks aren't changed when he gets back. lol Oiljob
It looks like the market is telling us we don't have a "done deal" until we file the 8K saying we have actually paid the full purchase price
The market is trying to spin this as more pumping. So I hope they short the hell out of this stock and we file the payment disclosure soon.
This might actually be the "bear trap" (or part of the trap) everyone keeps speculating about. Oiljob