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isis in retrospect

  1. 993 Posts.
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    Hi all,
    Well, the condensed summary of the ISIS report has finally been released - had a thorough read of it since arriving home late this afternoon. Interestingly, some people on here seemed to have found it rather overwhelming and lacking in numbers, whereas others were very impressed; creating a rather mixed bag response. Interestingly, just look at the trading pattern itself which says it all, a classic doji candlestick signalling a tug-of-war between bulls and bears. In this case, substitute the bulls for those that comprehended the significance of the report versus the bears whom obviously did not. Personally, I was a little concerned that punters overall were going to put too much emphasis on this report, as if it was the be-all-to-end-all. On the contrary, this report is highly significant and represents the compilation of an enormous amount time and effort spent sequestering and analysing data from multiple sources in order to fully describe the resource potential within these permits.

    For a company (BKP) that has only traded for 5 months, one can't stress how critical it is to having a solid understanding of the underlying geological structure, re-assessment of the historic well findings, inspection of the geographical seismic data and so forth, before finally putting together a summation of a strategic direction for ultimately establishing a successful drilling program. It is my belief that this report is compliant with prudent practice for any company in their early stages of exploration in order to adequately assess the strengths and weaknesses of their data so as to make an informed and calculated risk-reward decision on each of the potential plays within these permits. As a shareholder, I would hope one would commend a principle of where due diligence has been properly undertaken. So really, in essence this report paves the strategic direction in which BKP/NTO must now move forward, as shown in the recommendation section at the end of the presentation.

    Putting the positives aside, I do have a few reservations not really on the content but on how that content was reported and presented, although this might be trivial to some but perhaps not others. It is possible, due to time constraints or pressure from shareholders, that the information in the slide presentation appears to have been put together without too much thought into explaining the significance of each of the slides. For example, take slides on page 19 and 20 Residual Bourguer Gravity. Here we have several charts with residual gravity maps along with brief descriptions of the process for determining some of these residual anomalies. For ones information, Bouguer gravity maps basically relate to differences in rock density. So, where the density is larger the Bourguer gravity field is stronger (or more positive), and vice versa. They provide useful info on specific rock types or structures such as faults. Anyway, returning to my point, there is no explanation here for the average punter as to what, where and why these slides are significant. Alas, inclusion of arrows highlighting anomalies of interests would have at least been slightly helpful. Well, I could go on... but I dont want to get too bogged down in this but lets just say the presentation is littered with material that perhaps isn't properly explained or is not fully essential for telling and effectively delivering the big story. Nonetheless, putting these issues aside, the information derived from this report is as I stated before crucial for BKP/NTO progressing forward.

    So, where to from here? It's getting late here but let me just say there is one development in particular to really keep an eye on, and it relates to the re-analysis of core samples (located at Alice Springs) containing oil shows from Elkedra-7A (see map below). This was mentioned in the initial announcement today despite unfortunately not being elaborated on to any great extent in the subsequent presentation. The significance here lies in determination of the reservoir quality from which a potential target size can then be estimated. The NTO team will then have to determine the integrity of the oil trap (ie. validate the oil chemistry signature against other drill wells and with laboratory-produced oil simulating that produced via the Arthur Creek formation). Similar oil comparisons would strongly hint at the potential for a large play in this region of EP-128. The proof of the pudding however will be confirmation from a test drill. Speculation on the target we're looking at here has already been discussed before but, as a refresher, we are looking at potentially hundreds of millions of barrels of oil spread over from 100 to 1000s sq kms in this region of BKP's permit!

    So clearly today there were no numbers (eg. resource quantity predictions) mentioned in the report, to many people's disappointment. It is clear however from a review of current findings that there still exists a paucity of information for this region, which thus limits their ability to provide accurate resources estimations at present. Nonetheless, analysis from Elkedra-7As cores will certainly start to fill in our gaps in knowledge, and hopefully provide us with some potentially exciting numbers to begin playing with.

    Nite all.
    Sagitar

    ps. Map highlighting relative location of Elkedra-7A.
 
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