GREY:STPJF - Post by User
Comment by
Eyeinvestoron Jun 24, 2014 5:04pm
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Post# 22690942
RE:Well Performance
RE:Well Performance
Yes I have heard this several times about Pad 1. To a lesser extent on Pad 2.
The company has admitted it made a mistake with Pad 1. Pad 1 was an unmitigated disaster. The separation of injection and production wells was too great, and the varying contours of the production well trying to catch every last puddle of bitumen simply didn't work. ICD on one of the wells has started to help, but cap ex would be much better spent on Pad 2 IMO
Pad 2 is much better and seems to respond well to ICDs. But if they were doing it again, they would be more conservative.
But ultimately, what we have always argued on this site is that STP should drill new wells. It could be a new pad for around $70-$80 million. It could be infill drilling on the existing pad for around $50 million. Either way we have a $500 million best in class steam plant whiling away unproductively for the sake of $50m spent on more conservatively drilled well pairs. If I was STP, just offer a strategic partner a hellva deal on partnering in some new well pairs. It doesn't matter if the deal is great for the partner and dilutive for STP. If STP starts pulling commercial production from some well pairs on McKay then Mr. Market will start to attach some value to all of STP's McKay basin assets.