Press Release: Quick ThoughtsA) Horizon 23 was Santonian in age. Presence of liquid hydrocarbons is fantastic. Shame, however, we still do not know if it is condensate or oil.
B) Would love to know the thickness of the sand bodies in Horizon 23. Is it one massive thick body (which would make volumterics much easier) or is it many thin sand stringers?
* Encountering 200ft of net pay across entire well is great, but sure would have been nice to know how much of it occurs within the "liquid hydrocarbon" Santonian interval.
C) Spending $141MM USD (~$178MM CAD) on a well and not being able to get critical information like pressure data/fluid samples (MDT) or even sidewall core plugs (critical for petrophysical well-log reservoir quality calibration- porosity, permeability, water saturaton) is a big missed opportunity. Really hope they got good well-logs. Nonetheless, relying solely on chip cuttings to determine hydrocarbon quality will be tough. Perhaps that is why we are still left with "liquid hydrocaron" and not oil or condensate.
D) Demerera is extended for another year. The government truly loves CGX! They talk a tough game in the media, but play with kid rules with regards to CGX, thankfully.
End of day, least we have "liquid hydrocarbons" in the primary zone of interest (Horizon 23/Santonian). Based on Sedar MD&A, CGX is in a massive financial hole and a JV is sorely needed to help finance Kawa-1 costs, and future exploration wells/port completion. Given that critical information regarding fluid composition is still not known, and that variables like porosity and water saturation (needed to calculate volumestrics) are only being determined via well-log calibration, any data room evaluation/formalized bid will likely take many more months to unfold.
Let's see how the market interprets the news! Hopefully we can hold onto the $2.80-3.00 price range formed over the past month, or even get lucky and get a nice bump tomorrow.