A couple of items;
Highlander: "( - depending on oil price used)" You should not be using oil price for Highlander as it is all dry gas.
Davy Jones: With both the crete/tusc and Wilcox flowing water, Davy Jones is done. I wouldn't be surprised if they let their Davy Jones & Blackbeard leases go/expire. With oil/gas prices where they are, FCX will not be putting any cap ex $$$ towards the UD shelf.
They will probably look to keep the onshore ILT (i.e. Highlander, Farthest Gate West, and the other acreage (about 60,000) around them alive. However, they probably will look to do minimal cap ex towards this area until NG prices improve. They will look to do just enough to keep the leases until then.
The highest priority in the oil/gas area of FCX is the deep water oil and will attract the most cap ex $$$ in a current declining cap ex budget environment.
RJ3 - are you sure they will start Highlander #2 by the end of Jan/Feb? With NG prices where they are, I'm thinking they may hold off on starting Highlander #2.
FCX is estimating $70 million per year for this well at today's NG prices. This would equate to about $1.05 million per year to BLMC with their ORRI. Will be interesting to see if FCX goes ahead with the permitted Highlander #2 well given current NG prices.
Permit to perf Highlander is still showing as not performed in SONRIS. Therefore, I would guess that they will not make the end of year timeframe they mentioned last month. Not sure what is taking so long to prep the well for perf'g.
Did you see the latest scout report on Farthest Gate West? Looks like they hit a section that started given them problems just below 12,000'. Well started to flow on them. They probably new about this section from the seismic/nearby wells as they recently set a string of pipe just above this section. Thoughts?
If you go to the MMR IV board, the links for the wells are up top. Click the Highlander link and then scroll down to the bottom of the report to see the change permits for the well. Currently, there is just one - the perf'g permit. The table has a column named "Work Performed", which is currently "N". Once perf'd, this should change to "Y" (I've seen them get updated for other wells on SONRIS. Hope this helps.
Davy Jones is done - at least for now. DJ1 could not/would not flow due to either the mud/barite/completion issues they had or unfavorable reservoir characteristics (Flores hinted that he though it was the latter). DJ2 flowed mostly water from both the cret/tusc and wilcox tests. Both are "temporarily abandoned" - which is probably just to delay the write offs. Flores stated "all eyes should be on Highlander", and I think he meant it.
SERIAL WELL NAME WELL NUM ORG ID FIELD PARISH PROD TYPE SEC TWN RGE EFFECTIVE DATE API NUM
245356 EOC-TUSC BL UDS SUA;J MIN LLC 001 M224 0875 50 00 011 13S 11E 07/02/2013 17099216180000
Scroll to the bottom of the report - shows permits and whether the work has been performed. They do update this section (seen in other wells) once the work is performed.
I think you mean "preparing for testing began in early November". I don't think the actual flow testing has begun as the perming for perf'g the well still shows it has not been perf'd via SONRIS.
I don't have much confidence they will be successful at SS188. I believe they will take the Joe Douglas rig and move it to BBE for a completion attempt there afterwards.
Lineham Creek - Operated by CVX and has been said to be targeted for a mid 2015 completion attempt.
Farthest West Gate - Lineham Creek look-alike operated by FCX has been spud and is drilling with a proposed TD of 24,000'
Here is a summary of what I know of UD (now ILT) the wells in progress (in the order of what I think we will have completion information on next):
DJ2 - Crete/Tusc completion & test flowed pretty nicely, peaking at around 2,500 bbls/day. Unfortunately, it was water and only trace amounts of gas. It showed that the crete/tusc had the fracturing and permeability that they were hoping for, but did not have a good enough trap/seal to collect hydrocarbons. They have moved the EXL III back on and are in the middle of completing the Wilcox zones above. The latest BOEM reports are showing that they are getting pretty far along and, barring any unforseen problems (which we have seen in these type of wells previously), they may be about a week or two away from testing.
Higlander (Lamond North) - originally were to have tested by early Oct., but seems they have some equipment issues causing a delay. The SONRIS report still shows the perforations "work performed" as No. Not sure the nature of the equipment issues. Guessing that the testing will be a mid to late November event. Looking forward to this test as Flores was extremely excited about the quality of the logs & cores they took. They have permitted an offset well about 1,000' updip to the east of this first well. The permit is to 32,000' and they would be looking (if Highlander 1 is successful) to test lower tusc sections that they were not able to reach at Highlander 1.
SS188 - Not looking good. I'm pretty sure EXXI backed out of their WI for the completion (show of no/low confidence). They completed and tried to test the lower laminated sand sections, but it does not look like it was successful. The latest change permit on BOEM has it as temporarily abandoned to change zones for another completion attempt. I'm guessing they will give it one more try to complete/test the "coffee grind" zone that was just under the salt. They are just looking to get some production to be able to hold the lease unit.
States that the well has been temporarily abandoned. However, the permit type is "completion" and it also has "complete new zone". So, it could be that the bottom zones (laminated sands) did not work out and they will look to try and complete the upper zone next (referred to as "coffee grind zone" by Jim Bob).
Take a look at FCX's presentation in early September, slide 25. They show an analog to a Judge Digby field log. Judge Digby is a tusc/cretaceous field about 50 miles north of of Highlander. If the analog is correct, they were less than halfway through the potential pay zone when they stopped at Highlander 1. With Highlander 2 about 1,000 up dip, starting with a 40" hole (if the rumor is correct), and permitted down to 32,000' means they are gearing up to drill the whole potential zone for what they think could be a monster well. JMO of course.
Yes. Offset well permitted to 32,000'. Read in a post that they are using 40" surface casing (FWIW). The well is about 2 miles east of Highlander 1 (and slightly north). From FCX's latest presentation, Highlander 2 will be about 1,000' up dip on the structure from Highlander 1.
Actually, they price on LLS (which seems to follow more closely to Brent than WTI).
Not sure where play_tow gets the $90/bbl break even figure, but I believe that is totally incorrect. They may be cash flow neutral around $90/bbl, but that is totally different from P/L.