TULLOW:: ANGUS MCCOSS COMMENTS Wow - just listened to Angus McCoss and his overview of Guyana / Jaguar-1. In short, Tullow has come out and stated the propsectivity in the area has been enhanced based on what they encountered in Jaguar-1. Summary is below:
Angus explained the main reason why the well has to be adandoned was due to un-expected high pressures being encountered higher up in the well. To get through these shallow high pressure zones, the partners had to run a casing string higher up in the well, which was not in the original well plan. Essentially, running this casing string early prevented the partners from not penetrating the primary target.
After encountering the 2 fans having 'light oil' - Angus said it was frustrating not having reached the primary objective. However, information has been collected and is being analyzed. The partners are presently in discussions on a way forward to continue the venture.
In response to a question from the Citi Analyst: Angus commented the chance of sucess at Jaguar has increased. Prospectivty / risk has certainly changed / improved. Angus said Jaguar-1 had no calibration well to map out appropriate pressure profiles (i.e. difficult to drill). Angus also said it will take at least a year to re-design the well and make preperations to drill it.
Clearly, this response from Angus indicates an extension on the Georgetown Block will be needed. Angus did not mention the Georgetown Block was expiring in November 2012. So, maybe something has already been worked out with Guyana and the partners - in terms of extension. Certainly, it did not seem this was a big enough issue for Tullow to address.
Financially, Tullow has never been in a better position then where they are today. $2.9B cash added to the balance sheet from the recent spin-off in Uganda assets, big cash flow coming from Jubilee (ramp-up continuing); spinning off 'non-core' assets in the near future (Pakistan, Bangledash, etc) - what in the world is Tullow going to do with all this cash.....