Valeura Energy Inc. T.VLE

Thrace DBGA v Anadarko Granite Wash

[DocPat]

Firstly, I am not in any way giving advice in any of my posts and I am not in any way an expert in any of this, only an interested investor. This is only my opinion and just for the general interest of others who, might be interested. :)

On page 15 of the November 15, 2018 "Site Visit 2018" presentation found on the VLE website they do a comparison of the Thrace Basin BCGA to the Anadarko Granite Wash.

I believe this is common practice in the energy Industry, to find a successful analog to the porspect you are proposing to exploit and if the calculations work, proceed with exploration, verify comerciality and exploit. 

There are many similarities and a few important differences. The most concerning to me, and I have to admit it caught my eye in the early days and $4 and $5/share prices was the permiability.

In the VLE presentation they stated porosity in the Thrace was 3-9% and Granite Wash 2 - 14 (Avg 6) Pretty close. :)

In the same chart however they quoted the permiability in the Thrace to be 0.001 to 0.02 and the Granite Wash to be 0.0001 - 0.1 The best in the Granite Wash being 5X better than Thrace and the worst in the Granite Wash being 10X worse than in the Thrace. It's close, but permiability is about how the holes are interconnected and you need that to get the gas out.

Look at the graph yourself, but the pressure is about 25% better in the Thrace.

So with a bit of research I found the article by Yunan Wei and John Xu entitled Granite Wash-A Liquid-rich Tight Gas Sand Play. An interesting read to be sure. Here is the link:

https://www.researchgate.net/publication/301779537_Chapter_16_Granite_Wash_Tight_Gas_Reservoir

A few tak away point were:

1.) With 4500 ft horizontal legs and 30 fracs the IP rate was between 2 and 27 MMfcf/d.
2.) Horizontal wells could produce 20X that of a verticle well.
3.) Average IP was 6.5 MMcf/d

There is a lot more in the article, but with the lower permiability it seems to me you are going to have to have fewer liquids (Condensate or water) and higher pressure.

As Sean is proposing to go deeper, you should have more pressure, potentially much more and if we are in zone that is not liquid rich or the liquids are gas at that depth with the inherant increase of temperature and pressure at that depth, it might just work.

It seems to me that if we get a straw into it and we find good or great production the field will likely be smaller. My guess is that this is why Equinor (Statoil) pulled out. With the decreased size of the play it was no longer big enough for them. They are a super major.

But, it still may be a huge for a midsized O&G company which there are many many more than super majors.

Time will tell, but the numbers are still to me, somewhat compelling.

All in my humble opinion,

Doc.

[Farmer9]

Are you saying to buy or sell?

[DocPat]

Lol, I am not saying to buy or sell .. just my own contemplations to share, that is all.  As well, none of the existing shareholders would want me to recommend VLE as when ever I do recommend a stock to a friend it instantly goes down.  I will say that I am long on the stock .. a few hundred thousand shares long. Is that a good idea or not, who knows? Only time will tell. :) Best of

[Farmer9]

A person has to think the stock price will soon reflect the amount of cash the company has.  Unless the company has a bad track record of freely spending cash needlessly.

[firstworld]

No one paying attention to vle it has reputation as loser derived from the eqinor exit and two years with zero developments except share options, bonuses and selli g shallow at 50% discount. Best case they are viewwd as losers worst case corrupt fraidsters. Either way this is dead money for years to come.

[DocPat]

Really?? YOU sure seem to pay a lot of attention to vle? Not sure who over there wizzed in your cornflakes, or if it is just your nature, but you are truly a pest. If you don't like the Thrace basin, that is fine .. it would be interesting to hear your technical reasons, with references attached. But if you do not have anything of value to contribute then just buzz off! Doc.

[firstworld]

Nearly all shareholders bought into Thrace and bet on that the big issue is that they are not developing Thrace because they lost their partner Equinor and $100 M in data look so bad they won't use our money to do what they said they would. Instead they sold the only cash production to opaque newco at 50% discount to last appraised value and are now looking for an entirely new business to buy

[copperplay]

I am betting they are about to make an aquistion of new assets at any moment.  JMHO

[bandit69]

Why would it reflect in the SP?  it won't.  why? because even a dummy like me knows they're just burning it.

[DocPat]

I have to agree. When there is a new issue it hopefully trades above its cash value based on the optimism in the team and the company's future. Clearly the market has lost faith in Sean and his team. Are Jim and the other founders still involved or did they take their cash and jump ship?  Maybe they just don't care anymore? Pockets full of cash and all. And so it is in Sean's

[Overertune]

Oil is hot right now. Don't know their chances of finding deal in this market.