Some picturesque speculation

[Debug]

There has been a fair bit of discussion about the current status of EB1 after the last RNS.  

I have considered the information in the public domain to try and work out where we might be.  
Its not great that we have to guess, but this is my take on it …

 

               EB1
               /\
              /||\
             / || \
###############||###########
-              ||
-              ||
-              ||
-- 1000        ||
-              ||
-              ||
-              ||   
-- 2000        ||
-              ||
-              ||
-              ||
-- 3000    ----------
-           * *||* *
-           * *||* *
-           * *||* *    2 x Shallow Zones 3000–4500ft   
-- 4000     * *||* *    Untested during WO 1.
-           * *||* *
-          ----------
-              ||
-- 5000        ||
-              ||
-          --*.||.*--   W/O 1 upper depth 5500ft
-            * || *    
-- 6000      * || *     26 x Wet, Dry, Tight zones  
-            * || *     Unspecified thickness and distribution. 
-            * || *     Combined tested Size minus the NPZ = 250ft
-            * || *    
-- 7000      * || *     2 x Oil Bearing zones with a minimum 
-            * || *     150ft NPZ.  Oil Flowed to surface, but flow
-            * || *     was impeded by wax. 19% "effective" porosity.
-            * || *     Gross Zone size                    = 380ft
-- 8000      * || *     2 x Producing zones on OWC, with Zones 
-            * || *     below 8000ft tested as group. Size = Unknown 
-------------*.||.*---  WO 1 lower Depth at 8400ft

#############################        TD                    = 8550ft

Assumptions :

Test was designed to target of 11 primary zones in the lower section only. 
Zones were broken up in to 30 secondary zones over the whole lower section.
The lower and upper (shallow) sections have a combined thickness of ~1100ft.
The two sets of 2 producing zones mentioned are not the same.
As 2 zones are approximately 380ft (gross), the thickness of the other 26 is likely to be quite small individually.

The logical layout is possibly …

-------------------------------------------------------------------------------
2 Zones untested in shallow section                    (unspecified size)
-------------------------------------------------------------------------------
26 Zones Wet, Dry or Tight                                 (~250ft)
-------------------------------------------------------------------------------
2 Zones Oil bearing & flowing, but impeded           (380ft Gross)
-------------------------------------------------------------------------------
2 Zones on OWC not flowing consistently             (unspecified size)
-------------------------------------------------------------------------------

Some things we know:

30 Zones tested with a cumulative total of 400ft that included …

26 Wet, dry or tight zones.
            2 potential zones on Oil/Water contact which did not flow consistently.
            2 Oil Bearing zones from a Gross formation of 380ft which flowed           

The OWC zone formations were not cleared due to time restrictions.
The Confirmed zones have 150ft minimum confirmed Net pay.
The Confirmed Zones flowed to the surface, however flow impeded by paraffin wax and kerogene(?) in the formation.
The Confirmed zones have not been fully perforated (only 150ft of 380ft)
Zones below 8000ft where tested together.
Total porosity of NPZ = 22-24% with “effective” porosity of 19% (i.e. pore space with potentially movable fluids/hydrocarbons).
Some individual Pay Zones are expected to be quite large i.e. 300ft.
The producing Zones were above 8000ft.
The test was “Top Down” (from IP interview and RNS).
Tight zones may also flow.

Some things we don’t know:

Distribution of target zones in the formation.
Number and size of individual wet/dry/tight zones.
Location of Oil/Water contact.
Individual size and location of each of the two gross pay zones.
Size of zones below 800ft.
Permeability of rock with “effective 19%” porosity.
The flow rate from the two Oil Bearing zones.
Water cut.

Comments:

There is some confusion over the number of zones actually tested and if the separate mention of two producing zones refer to the same zones.   They state that 2 producing zones where on the OWC and they did not flow consistently and that they had no time to clear these productive formations. To me this strongly implied they were at the very bottom of the lower zone and the last thing tested i.e. below 8000ft, yet in the ii interview BM states that the Oil bearing gross zones are above 8000ft.  So I am taking it that these are two separate pairs of zones. This also fits the calculation for 26+2+2 = 30 total zones.  

Either way I it seems like the areas where we had less success were subjected to a lot of testing despite them likely being of relatively small gross thickness.  This extensive testing looks to have been targeting the many thinner and more complex pay zones and formations.  Compare that to the areas where hardly any testing was done (relatively) and where they also ran out of time.  Here we have at least 380ft Gross in just 2 zones and 150ft apparently already confirmed as NPZ.  

I cannot quite work out why they did not do a bottom up (if indeed they did not) and test this less complex formation first.  If they had done that it seems to me they could have spent the time far more beneficially and fully tested and stimulated this area as necessary.  No one would have cared if they ran out of time on the upper part :D

Of course I may have this all wrong, its just what it looks like to me and it all hangs together based on the information in the public domain.  What I take away from this is that there is more to test on that larger gross zone and some very decent potential upside on what is already a good NPZ.  I would really like the Company to explain all this in a clear and unambiguous RNS though.  There is no reason to have such confusion now as they should have a very good understanding of the situation, they just need to share it. It would also be good to get more detail about what they think is going on regarding the flow impediments mentioned and the W/O 2 strategy.

Anyway, like I say just my musings.  Changes nothing until the next update.

Cheers
Debug

References:

25^th May RNS indicates potential pay zones of 100 to 300ft before 7474ft.
http://www.investegate.co.uk/u.s-oil-and-gas-plc-(usop)/mkw/operations-update-eblana-1/20120525080009M2833/

08^th June RNS indicated “nine large potential porous oil reservoir intervals” of approx. 1100ft before TD of 8550ft.  RNS also states “Advanced well log processing and interpretation” started.
http://www.investegate.co.uk/u.s-oil-and-gas-plc-(usop)/mkw/operations-update/20120608173035M2198/

27th July RNS indicated 11 zone test program (from potential 20) decided after advanced well log analysis by BH.
http://www.investegate.co.uk/u.s-oil-and-gas-plc-(usop)/mkw/operations-update-eblana-1/20120727080009M2852/

13^th Aug RNS test zone indicated test coverage between 5500ft and 8400ft (2900ft).
http://www.investegate.co.uk/u.s-oil-and-gas-plc-(usop)/mkw/operations-update-eblana-1/20120813182904M7696/

16^th November iii interview BM states that the wax and kerogene is not from shale and the oil is not shale oil. Also that the flowing zones are between 5000-8000ft.
http://www.iii.co.uk/articles/61003/view-top-us-oil-and-gas

16^th November PI interview BM states it’s a top down test.
http://www.proactiveinvestors.co.uk/companies/stocktube/1446/us-oil-gas-ceo-remains-confident-1446.html

[usher03]

Wonderful post Debug!

An absolute credit to you for taking the time to produce this.

Kind regards,

Usher.

[davlum]

Wel done mate.

Fantastic Post.

You are a master of Logic!

[smartbeds]

Great post Debugg.. Thanks

[By The Bay]

Thanks Debug, nice picturesque and verbal breakdown of the technicalities.

I predict this board is going to become a lot busier soon.

Merry XMas all.

BTB

[Hammers102]

Thanks debug, that's a very concise view of events and expectations.

[Mosa]

Debug,

Good post, what are your thoughts on the capping or seal if this is the way round? shale?

The shows above could well be bleeds but as so little has been released we may even have a fault further along and residual shows from that.

I also wonder how this would affect EB2 (if this was the centre) and what happens deeper.  Too little info, too many questions!

[tetchy]

debug - A nicely thought out synopsis. I agree, this site could get busier.

[Debug]

Thanks Folks, sometimes helps me to draw things out.  I wish the Co had done this for us though.

Hi Mosa,

This is not something I know a huge amount about so I will tread carefully and bow to others knowledge here.:D  

Because of past presentations and information I had assumed that we were targeting reservoir rock with structural traps.  I don't think there is enough additional information to change or confirm this view. The mentions of tight zones might make one think there could be other things at play (shale etc), however once again there is not enough data and BM has also stated that these tight zones may still flow after stimulation so is "tight" simply a relative term here?   

It suppose it might also be (almost certainly could be) that the area we are drilling in to has multiple complex structures and that there are several areas with differing trap mechanisms and like you say some zones with bleeds, possibly from the larger zones below.

The one thing that stands out is KA and BM's insistence even after w/o 1 that this is not a shale play, and we are not targeting Oil Shale or extracting Shale Oil.  We are still looking at traditional play with medium crude in a reservoir rock so this is a good sign to me as there was no need to reaffirm this if they were not sure. I did note that this in direct reference to the large lower zones though so it may just be true for that area, but still that should be good news. 

I do have a gap about understanding the kerogen reference though as I had assumed that no significant quantities of this would be seen in a reservoiur rock as opposed to a source rock. Could this be contamination due to the strategy used?  i.e. combined zones, no proper clear up, top down etc? What do you think?

Debug

[valencia]

Fantastic post Debug, as ever...

Thanks for your take on it

[Red Squirrel]

Many thanx Debug.

Can Soops help with " some things we dont know " and confirm / refute,  and add additional comment to your assumptions?

VBW

[fightfear]

Great stuff - very clear and easy to understand (shame our RNS's aren't)

The reason for doing the "top-down" test could be that the shallower zones were known to be very commercial (expected to flow very well or maybe even flown very well already) so perhaps they were just going down from that level to see what else is down there and gather as much info as possible for the buyer along the way too.

My understanding is that if they have flown from a zone for less than the required length (24hr being minimum I think) than technically they wouldn't have to announce it as it wouldn't be counted as a "flow test" per say (it would be incomplete). All they needed is logging data and an hour or two of flows to know that this zone/s is/are great.

[solidfoundation]

Debug - Excellent summary
I think you should  be writing the RNS's from now on.

[Mosa]

Debug,

The reason I mention shale was purely from something else I read around Nevada geo and it being an inperm structure so would act as a good local seal depending on how it lays, not inferring it's the oil shale/shale oil argument - I'm leaving that well alone.

Basically if this is what we have there must be an element of sealing between the water (which was mentioned as aquifier?) and oil, so if water above oil I assume a seal and therefore there may be another band below the oil, which a deeper drill would target as finding the lower OWC is also of importance to the CPR.

If it's oil over water then my mild concern is that 8000 might be your cap, so could not see EB2/3 going deeper - again, so little information to get an understanding.  I do hope at some point a 3d colour contour map is released with the data set overlay showing just what they think 'lies below'.

My major concern which has been since reading it in the RNS and trying to google (simple searches using kerogen + immature, kerogen + mature, etc etc with tight, permeability, porosity etc) is the use of the word kerogen.  I know people have said 'it will flow', 'this has been done before' the mere fact it hardly appears on RNS's (do a keyword search on investigate) - but USOP did do a Vitronite Reflectance-Visual Kerogen(TAI) as one of the data sets, a pdf below.  I do not have time to do more searching but this test may thro up some things if any others do have time.

http://www.osti.gov/bridge/servlets/purl/5672314-OzuDFu/native/5672314.pdf

I have tried to understand if kerogen is like cholestrol in the blood stream and how it blocks and forms but it may be more like blood cells on an open cut.  I think it 'sits' there inbetween the permeable space, so I'm not sure how well it flows around.  But it is insoluble, so it's more like rock than bitumen.

[fightfear]

It was suggested to me that perhaps we're dealing with asphaltenes here which are chemically altered fragments of kerogen that could have migrated with the oil from the source rock. That would apparently also explain the reference to paraffin waxes. it was also suggested that they are probably thinking about some kind of solvent squeeze to clear the perforations and nearbore area of the waxes and asphaltene.

[Mosa]

FF, interesting.

http://www.london-nano.com/research-and-facilities/highlight/asphaltene-aggregation-in-the-presence-of-laponite-clay (just the one with the most amusing picture).

Comes back again to the lack of information from Brian and team.  Is it asphaltenes, kerogen, bitumen, wax, molasses.....

~There are a lot of people wasting a lot of time searching, reading between lines, hypothesising all due to the company changing how they communicate by quite some margin and I do not hold the CA responsible for all of that.

[logcutter]

Just caught up reading these posts, got to say a big thanks to Debug , mosa, ff etc.... great easy to read explanations, certainly been helping me to understand what is probabaly happening ?!....

Merry xmas and peace to all......

 

Log

[Debug]

Hi Mosa,

Oh I see what you are saying, sorry I  misunderstood first time.  

It was my assumption that there could be an amount of water in many of the higher zones, however this is in contrast the the more substantial separate body of water that makes up an aqufier drive for one or more major oil zones. Additionally I expected that the oil would be above the water and that there is no seal between them, rather there would be a natural transition zone  making up the OWC.   Of course this then also needs a cap to complete the picture and one layer could be at 8000ft as you say.  

In our case we apparently have multiple stacked targets of varying quality and structure, however there is so little detail available about EB1 it's impossible to say what the make up is. I do think it is fair to say though that we have tested at least two potential zones on the OWC which is encouraging, and we have at least two other zones which have shown 150ft NP, but with unknown relation to an aquifer. 

It is a real shame the last RNS did not help clarify this in any way :(