New well spudOK, it's getting a bit silly to be commenting on new well spuds. but these are exciting times and one has to read the tea leaves...
The 5-34 rig was moved to surface 15-29-68-8 and spudded 10-32 yesterday (from the 15-29 site, or vv, I get confused...). This is the 5th HZ spudded including the original, and there are now 3 rigs going, just as they said. WIth 5-34 rig released, we can assume the frac has taken place so we can watch for testing results soon.
If any of you happen to be driving around the Swan Hills area, have you ever considered well sitting for a day or two? Would sure make my day! Should be easy, just count trucks!
Just doing a quick tally - ARN raised 65 MM, probably about $60 mm net, paid Celtic $53 mm, leaving 7 million. At >$4mm per well, ARN has allocated >$20 mm to these wells. They raised $11mm to pay for the first one, so with $18 mm max of equity allocated to these wells, ARN has burned through this and is into either cash flow or debt to pay for the rest of the drilling. Likely debt since cash flow on 2,000 b/d isn't that great (not relative to $4mm wells anyway). As usual, and I hate to sound like a broken record, looks like they must be very confident in what's happening. They are in effect betting the company, as if there was a reasonable expectation that these wells would crap out sooner rather than later, or water out, ARN would be left with a lot of debt, a lot of shares issues, and back where they started.
So it appears to me that things must be going very well, or prudent management would not be running so hard especially through break up.
As always, counter arguments appreciated - sycophants won't make you money, but good skepticism will!
Good day to all,
OPG210