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Saratoga Resources, Inc. Common Message Board

baby_face_finster 1 post  |  Last Activity: Sep 1, 2015 1:32 PM Member since: Aug 8, 1999
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    by malverndennis Sep 1, 2015 12:20 PM
    baby_face_finster baby_face_finster Sep 1, 2015 1:32 PM Flag

    Here is what we know from the latest FCX release:
    1) Highlander was averaging approx. 22 mmcf/day through June
    2) In July, Highlander had a down hole mechanical problem and had to be shut in to repair - not sure how long the shut-in is/was.
    3) SONRIS for Highlander shows a July permit to pull/replace the production packer and tubing (to fix the problem)
    4) SONRIS monthly production history shows steady production through June, plus the July drop off (when the well was shut in for the maintenance) - no August production numbers posted yet (will probably be posted in about 3 or 4 weeks)
    5) FCX continues to state that they are planning/installing additional amine processing units to enable them to increase (up to double) production processing for Highlander - anticipated to be installed by the end of the year
    6) FCX continues to state that they continue to plan for "future" offset development wells to Highlander and have multiple prospects in the Highlander area

    My thoughts:
    FCX will probably not be in a hurry to drill additional Highlander development wells until:
    a) The additional amine processing is installed and they see how Highlander produces/declines for a period of time at the higher rates
    b) Nat Gas prices improve (probably looking for $4 - $5 prices)
    c) The balance sheet/liquidity situation greatly improves for the O&G side of the FCX business

    Right now, FCX does not liquidity to do much new cap ex at all - they need to slice to the bone. Therefore, I would not count on additional Highlander drilling anytime soon. JMO

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