RE:RE:RE:RE:RE:RE:RE:Economic Viability of Kavango ProjectCan someone please explain to me why there is so much emphasis on the delineation between drilling and logging source rock compared to drilling and logging the reservoir?
I'm an engineer that has worked in the oil and gas industry (oil sands, unconventional shale, WCSB conventional) and source rock is simply where the diagenesis occurs. All we care about is the reservoir, and depending on the geological factors, permiability, geological upheaval, geological traps, etc. the source rock may or may not contain hydrocarbons.
Also, with all of these crazy numbers being thrown around, my guess is that the valuation of the company will be capped by concerns regarding stranded assets. Reserves are only valuable because it is assumed that they will one day be produced, which is why on a $/bbl metric, there are very different valuations for 1P, 2P, and 3P estimates/figures. I struggle to see how RECO will ever be worth anywhere near what Anadarko was worth, and they sold for $38B to Oxy.
I am by no means a basher, I own a few shares, and want RECO to succeed. But I really want to know why there is so much speculation regarding successfully finding producable resources while emphasizing this whole driling "source rock" thread.