RE:RE:Luiperd to be discussed at Africa Oil Town HallLuiperd got a brief mention at the AOI Townhall but not a huge amount of airtime and very little in the way of meaningful questions answered.
The key takeaways I noted were:
- Luiperd is 50% bigger* than pre-drill expectations.
- He was shocked to see the price fall after RNS landed he suggested absence of oil might be the reason why some got spooked.....but then mentioned how valuable gas condensate was
- Total believe the combination of both Brulpadda and Luiperd is sufficiently large that they can proceed with development studies and ultimately FID without drilling further wells.
- Luiperd and seismic completely de-risks the rest of the block and is a game changer.
- Luiperd is biggest african discovery in 2020 (I assume Guyana must be biggest global ?)
- The gas condensate is extrmely valuable in South Africa given it's upcoming gas shortage and closure of plants in Mossel bay.
- AFE will look to sell it's interest (but not clear if entire 11b/12b or just the 2 discoveries).
- They are expecting oil demand and oil price to start to increase late 2021 and prices closer to $60-$90 in the next few years (but stressed predicting oil price was a mugs game).
The not so good stuff:
- He said data rooms were empty and there was not a huge interest in buying conventional Oil and Gas projects at the moment........he didn't expand on when he thinks AFE will find a buyer but presumably his statement on oil price rising in late 2021 indicates a sale could be 12months and not 6.
- I'm still disappointed that Total cancelled the programme as nothing boosts the balance sale price like drilled reserves.........especially if we get hit with a big rig cancellation fee...........we have had 3 rig mobilisations to drill 2 wells FFS!.
Good luck everyone.
*I'm pretty sure he said 50% bigger but would not swear to it........the crux is that it was sufficiently large to let Total decide they have seen enough to make this commercial.