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Dejour Energy Inc. Ltd Ordinary Message Board

  • harold33272 harold33272 May 13, 2013 12:27 PM Flag

    Something to consider after reviewing today's news on Kokopelli

    First, a review of this particular line in the release:

    "Dejour is now modeling Kokopelli for the next wave of development targeted for Q4 2013."

    The series of releases from the company on its Kokopelli drilling program this spring have consistently and affirmatively detailed "ample gas shows, as expected." Translation = It's reasonable for shareholders to assume that production from the four-well program will be in line with management's "expectations." Basically, production from the four-well program is comparable to neighboring Bill Barrett (BBG) and WPX Energy (WPX) [I am not referring to WPX's "horizontal" well).

    Furthermore, as we all know, the current, private drilling partner (fund) has the first right of refusal on the second drilling program at Kokopelli. Now, today, Dejour management has given a time frame and a clear indication of its plans to move forward with additional Kokopelli development later in 2013. From this we can deduce this much: The current drilling partner, also obviously aware of the progress of the current drilling program, has already likely told Dejour that it will commit to a second drilling program at Kokopelli. With this, there are two items of interest. #1, Dejour will have more favorable terms with which to negotiate the second drilling program. And #2, due to the WPX Mancos discovery well nearby, we know Dejour ABSOLUTELY wants to drill a horizontal (Mancos) at Kokopelli because of the tremendous economies of scale/total return and the incredible bump its overall proven, developed reserves could potentially receive if successful. So, the question is will the second drilling program at Kokopelli involve a horizontal or will it involve another multi-well vertical program, or perhaps both?

    With at least one HZ drilled at Roan Creek over the next 12-15 months and should the company drill one at Kokopelli, if successful, and if at a fraction of the WPX discovery HZ, these two plays alone could be a game-changer for DEJ

    Sentiment: Strong Buy

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