RE: RE: More news and PP coming to finance???Patience is the word of the day indeed.
In the short term, this isn't great news and we're likely to see an exit of traders and gamblers.
In the long term, this is good news because there is commercial hydrocarbon. To put what happened in perspective, if you drill and perforate a typical shale gas well, you wouldn't even get any gas flow, but look what Hz drilling and fracking has done there...
I see two issues here though:
1) I think the biggest problem is that management/IR did not frame the expectations for this well correctly. If they came out from the beginning clearly saying that the well was expected to be a test/appraisal well to define the field better then the flow rates from each zone wouldn't have affected the share price so much. The first news release about the 5 mmcf/d flow and the statements about flow from the well ranging from 50-100 mmcf/d after acidising created ridiculous and unrealistic expectations of what to expect from a vertical well completed only with perforating. For those of us who may own a part of our position from 20-30 cents, it's too bad we can't just ask for a refund...
2) More work = more money = financing or JV. I see a PP in the near future...or in the best case scenario, some major or even a smaller company sees these results, sits down in a data room with TSU to see what they're dealing with, and decides to take some risk and JV with TSU to develop the field. It's been done before and could happen again. It could mean faster development with outside capital and no more share dilution at the cost of splitting future profit.
Overall, a part of me wishes that the well had gushed gas from the upper zones, but I guess Rome wasn't built in a day and as someone who works in the oil and gas industry I should have known that. I'm just going to hold my shares now...at least I can stop checking the share price every few hours/minutes now :)