Agree with your insight on both points. The additional well was drilled at great expense and indicates the JDZ has significant potential before it would be considered.
Sinopec is not likely to release drilling results until the final partnership structure of the JDZ is accomplished. Total's interest in Block 1 [a block we have been told is either non commercial or not capable of being commercially developed by itself] has to change our perception of the JDZ. Total's interest means either it can be developed by itself or it can be developed as a part of a joint development in the JDZ. Either concept is positive for the rest of the JDZ and ERHE. Total's technical experience could prove to be invaluable.
Sinopec [ or the other JDZ partners] needs to buy out the small companies in the JDZ. It is doubtful Sinopec would give up its negotiating advantage with the drilling results until it has come to terms with the other small companies. Sinopec will want to control who is in the JDZ.
If Sinopec would announce the drilling results first then a situation could develop analogous to the Jubilee field. Scores of IOCs and the government of Ghana wanted to be partners in the Jubilee field. Sinopec might have to yield to more interference from Nigeria and Sao Tome or have more partners and less control than it would prefer.
Financing the development which promises to be very expensive is another challenge. The recently announced Middle Eastern investors into the area may be significant. The partnership of Qatar with Total and the Dubai $5 billion of infrastructure negotiations in STP may or may not have bearing on financing the JDZ. If Qatar and Dubai are not interested in hydrocarbons from the area I want to know why they suddenly appeared.
No one wants to wait, but it is important to our investment that the partnership structure and financing are in place before we can move forward. Dusters do not result in this kind of scrutiny and investment of time and money. JMHO Farrell
And even if Addax wasn't ready to drill that other well I'm sure whomever was next in line would have gladly taken the rig early. I know we would have after years of waiting. It is flawed logic and somewhat ridiculous to think they drilled that optional well just because they had the rig there and had no other options but to drill. Day rates for a rig are only about half the cost of a well. They had many other options and chose to drill that well instead.
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