21 Mar 2012capital raising announcement● Neutral
Notice that 18,461,538 shares at 6.5 cents are to be issued on or about 23 March 2012. This is the A$1.2m placement announced on 20 March.
Announcements, explained
Each one in plain English, with the numbers worked through for a shareholder.
20 Mar 2012drilling result▲ GoodMajor
Logs show about 600 ft of Barnett shale, roughly 200 ft more than expected, with gas throughout and 8–14% porosity. Woodford top hit at 11,766 ft with gas to 670 units, so the well is being deepened. A further A$1.2m placement at 6.5c was announced.
16 Mar 2012capital raising announcement● Neutral
Notice that 27,000,000 shares at 5 cents are to be issued on or about 19 March 2012. This appears to be Tranche 2 of the February placement (inference; the notice does not say so); it is about 1 million more than the 26m maximum announced.
16 Mar 2012drilling result▲ GoodMajor
Mercury Stetson sidetrack reached 11,750 ft, with strong gas shows (over 550 units in Barnett, ~600 in Woodford). Company says this proves gas is present in the new province; logging, casing then frac expected in 4–6 weeks. Gas shows are not a flow test.
14 Mar 2012half year report● Neutral
Half-year report to 31 Dec 2011 repeats known events: partial Mercury Stetson re-entry and sidetrack plan, Triple Crown Ellenburger test finished, Cranemere approval awaited, Maricopa ~18 bopd. Text is truncated, so financials are not visible.
13 Mar 2012drilling progress report▲ Good
At 11,100 ft, Mercury Stetson hit the Lower Barnett at 10,936 ft with gas shows above 550 units (5.5%). Woodford remains to be drilled, with total depth expected later this week. Early encouraging sign, not yet a test result.
5 Mar 2012drilling progress report▲ Good
Mercury Stetson was at 9,826 ft on 5 March, averaging over 750 ft/day with the PDC bit. Company expects to reach total depth at the base of the Woodford late this week or early next.
27 Feb 2012drilling progress report▲ Good
The Mercury Stetson sidetrack kicked off the cement plug and was at 5,490 ft on 27 Feb, drilling about 20 ft/hr. Company says operations are progressing as planned; a bit change is due later this week.
20 Feb 2012drilling spud● Neutral
Rig 25 is fully mobilised at Mercury Stetson and, as of 20 Feb 2012, has started drilling, kicking off from the cement plug. This begins the sidetrack to about 12,500 ft after the abandoned re-entry.
15 Feb 2012admin correction● Neutral
Administrative notice that 30,000,000 shares were issued on 15 Feb 2012 at 5 cents. This is Tranche 1 of the Feb 2012 placement announced on 7 Feb.
13 Feb 2012drilling progress report● Neutral
Unit Drilling Rig 25 began mobilising to Mercury Stetson and should be rigged up later this week. The sidetrack from ~5,100 ft to about 12,500 ft through the Barnett and Woodford shales follows, then frac and testing. Continues the Jan 2012 rig contract.
7 Feb 2012capital raising announcement▼ BadMajor
Challenger places about A$2.8m at 5c per share, mainly to fund Mercury Stetson drilling and testing. Tranche 1 is 30m shares (A$1.5m); Tranche 2 is up to 26m shares (A$1.3m), subject to a mid-March shareholder vote. The price is well below the 15c April 2011 placement.
30 Jan 2012contract award▲ Good
Challenger contracts Unit Drilling Rig 25 for the Mercury Stetson sidetrack, mobilising mid to late February. The plan is a new hole from about 5,100 ft to roughly 12,500 ft, then logging and casing, with frac and testing after.
14 Dec 2011drilling result▼ BadMajor
After failed casing attempts, Challenger abandons the old-well re-entry at Mercury Stetson and will sidetrack from about 5,100 ft, needing a drilling rig in the new year for about 7,000 ft. It says re-entry was only partially successful, and it is discussing adjusted farm-in obligations with the JV.
5 Dec 2011drilling progress report▼ Bad
Mercury Stetson has slowed: the 7-inch casing slipped outside the 9 5/8-inch casing and stuck, and is being recovered. The 10-14 day timetable resets. Triple Crown work is delayed to the new year, so the planned frac slips again.
24 Nov 2011drilling progress report▲ Good
Mercury Stetson re-entry is going well: the rig cleaned out to 10,022 ft and tagged the bridge plug above the reservoir. The company expects the re-entry to succeed. New casing, logging and cementing are expected within 10-14 days, after a Thanksgiving pause.
23 Nov 2011investor presentation● Neutral
AGM presentation repeating known strategy and projects (Mercury Stetson, Triple Crown, South Africa). It shows a 6.5c share price, A$13.9m market cap and cash of about A$4.5m, down from A$5.9m in August. No new announcement.
21 Nov 2011drilling progress report● Neutral
The rig is on site and re-entry at Mercury Stetson began last week. It is drilling out the cement plug at 2,550 ft, on the way to new casing at about 10,000 ft. Nothing new on results.
9 Nov 2011drilling spud▲ GoodMajor
Mercury Stetson operations begin: lease construction approved and equipment mobilised, with the rig due mid-November. The 3-5 week re-entry is followed by a frac, possibly late Dec/early Jan. Management calls it 'transformational' after the Triple Crown disappointment.
26 Oct 2011drilling result▼ BadMajor
The Triple Crown Ellenburger lateral reached 6,112 ft. Significant drilling breaks were seen, but gas shows did not rise and no commercial gas flow was observed. The Ellenburger (1.6 TCF) test is disappointing; the hybrid zone frac is now 6-8 weeks away because of a frac equipment shortage.
24 Oct 2011drilling progress report● Neutral
The Triple Crown sidetrack reached 5,670 ft and is building angle toward the Ellenburger. Minor gas shows were seen but the company draws no conclusions. A broken bit and mechanical issues cost a few days.
19 Oct 2011director officer appointment● Neutral
Mike Much, who already heads the US operations, joins the board as a director. Executive director David Prentice has said he will step down at the coming AGM.
17 Oct 2011drilling progress report● Neutral
At Triple Crown the cement bond log showed good casing integrity, the whipstock is set and the rig has started milling the casing window for the sidetrack. Nothing new on results.
10 Oct 2011drilling progress report● Neutral
Equipment is mobilising to Triple Crown. A cement bond log is due Tuesday and the sidetrack should start later in the week, finally getting the long-delayed program going.
22 Sept 2011drilling scheduled● Neutral
A Nabors rig is booked for early November to re-enter the 1978 Mercury Stetson well (clean out to ~11,400 ft, log, case, frac). The Triple Crown rig is expected to mobilise within 14 days, a further slip from the late-August forecast.
22 Sept 2011annual report● Neutral
Annual report for the year to 30 June 2011. The highlights are the Triple Crown gas column over 2,300 ft (9 TCF in place), the Mercury Stetson acquisition and steady Maricopa production. Financial figures were truncated, so none are given.
29 Aug 2011joint venture update● Neutral
Challenger sets up a US operating group headed by Mike Much and is registered as a Texas operator. Triple Crown rig now expected in 4-6 weeks. South Africa's moratorium is now said to run to February 2012, so Cranemere approval is expected early 2012.
29 Aug 2011investor presentation● Neutral
August 2011 investor presentation repeating known projects and strategy. It lists 214.0m shares, 105.2m listed options, a 12c share price, about A$25.7m market cap and cash of about A$5.9m. No new announcement.
10 Aug 2011farm in farm out agreement▲ GoodMajor
Challenger agrees to earn up to 50% of the Mercury Stetson Prospect in North Texas (Barnett and Woodford shales, up to 55,000 acres, OGIP 360 BCF/sq mile) by drilling two wells, renewing leases and running seismic, as operator. Up to US$2.2m is payable; the rest of the terms were truncated.
4 Aug 2011drilling scheduled● Neutral
The rig for Triple Crown is likely onsite in late August, after delays, once it finishes its last well for another operator. The planned Ellenburger sidetrack (1.6 TCF) and Hybrid Zone frac (7.4 TCF) are unchanged; this follows the earlier slip to August.