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Monday, 06/04/2012 2:34:13 PM

Monday, June 04, 2012 2:34:13 PM

Post# of 34
Due dilligence on Petro Vista

Moderator - put this intel on the opening page or flag it.

Huge accumulation going on now

" PetroVista Energy Corp (PTV.V)

$13.8M market cap, trading 0.06 to 0.095 this week on 22MM shares since May 22nd. We entered Monday morning @ 0.06. Added during the next five days on weakness. The stock was bought heavily into the close Friday.

Petro Vista is a Canadian oil and gas exploration and development company with operations in South America. The Company's goal is to build an upstream oil and gas company with exploration and production focused in the highest resource potential and commercially attractive areas of the continent.

We think that they are about to take a major step forward on the realization of this plan. Transformative news is due.

The company has interests in two of Brazil’s most prolific and proven basins, the Sergipe Alagoas Basin and the Reconcavo Basin. Petro Vista has interests in a total of 15 blocks in Brazil, onshore and offshore, with working interests ranging from 25% to 50%. Net acreage totals over 37,000. These properties include prospects that are in, or have, both near-term production and development potential as well as longer-term exploration opportunities.

Keith Hill and Ian Gibbs of Africa Oil and Horn Petroleum are respectively chair and co-chair on the board. and Darren Devine is acting as CEO until a new lead entity is brought in to manage the production and development arm of the company (the vacancy is quite recent and the fill, in my opinion, is nigh for reasons discussed later on in this article).

Following his success in Africa, Keith has now turned his vision back to Brazil and is locked on.

In the Sergipe-Alagoas Basin Petro Vista is optioned to a 37.5% working interest (27.23% net revenue interest) in producing shallow offshore block (Taratuga). Pipeline access within 1.5km. Nearby Oil Fields include Carmopolis (30MMBO produced) and Caioba (50 MMBO produced). The oil from the Tartaruga Field is good quality 41 degree API. Existing production facilities are on site and Taratuga is now in production, awaiting the results of a workover (due in less than four weeks from this date) that is expected to see the two wells significantly increase their flow rates. The word 'significant' cannot be overstressed here.

The Reconcavo Basin is another proven oil reservoir going back four or more decades, and is another focus of PTV's interests. It has a very high index of recoverable oil. It continues to prove up new resources: Petrobras Finds Oil in Fazenda Panelas Field of Reconcavo Basin, May 01, 2012 and Brookwater Tested Oil, Gas Shows In Reconcavo Basin Feb-Mar. 2012. PTV has a working interest in 2 onshore blocks totaling 4,364 Net Acres of low-risk and low-cost exploration opportunities with nearby pipeline access. The area is directly adjacent to the proven Miranga Oil field (Petrobras) - 814 MMBOE in place. More to come on this in the next little while.

Then, in all of this, is the one element that has true speculators salivating: PTV also have eyes set on deep water exploration.

In 2010 Petrobras identified hydrocarbons in well 1-BRSA-851-SES (1-SES-158) on the Barra prospect, located in the ultra-deep Sergipe-Alagoas Basin waters in the BM-Seal-11 concession. This new oil province in the Sergipe-Alagos Basin confirms the existence of large accumulations in the distal portions of the basin, implying there are greater volumes than those found in shallower waters. The identified hydrocarbons are also similar to those bearing oil in the deep Campos Basin waters.

So, the plan is simple: create a Brazil energy consortium of significance whose existence is predicated on sustainability, and through their presence in the region and led by champions of energy, find themselves among the best deep water exploration prospects by invitation and guile.

Our sources and research tell us to expect something that will point the way forward on this, and soon. Remember back to the beginning of this opinion piece: the CEO's position is now vacant. This is not by happenstance. According to conversations with management, of the three options discussed at last Thursday's at Africa Oil AGM one stands out: bring in new operational management that can best deliver on the wishes of the board.

Our thinking on this is simple. Keith Hill and Ian Gibb deplore risk yet reward entrepreneurial spirit and adroit management. They will not allow this project to fail. They do not entertain money from people they do not know. And they will not be inviting in operational talent they haven't had success with on other oil ventures. There have been hints from the galleys that a mid-tier Brazilian outfit may be joining in. As of Friday I am discounting that and placing my bets on Tullow.

You heard it here first.

Given all the above, the group's good friends at Merrill lynch have been buying all the shares they can. They've been doing this on AOI and HRN, and now here. There is a reason for this. These shares can be positioned in any direction, at any time, like a heat seeking missile. They can be laid down like a golden carpet for a new fill, an asset. Something that could grab the attention of a group like Tullow and keep it.

What asset might that be? Offshore Brazil? French Guiana? Uruguay? Take your pick. In two of them Tullow are already there.

With 25M warrants ready to grease the treasury (and, through conversation with those who should know, are more convinced that ever that these shares will find their way into the company coffers above 0.20) we expect to see a run on this stock into the low thirties for the first leg. The second leg could accommodate a raft of warrants that need to find a new home from .40 up, taking the stock to the low 0.60's.

Sound like a stretch? Where were you when AOI got going just a few short months ago?

As Mr. Devine said to me, “She's been trading like a beast!'. We may have seen nothing yet. I for one am looking forward to PTV's first 10 – 15M share day in the near future.

PTV has moved off absolute bottom recently and is currently showing firm support on the Daily Charts at 0.06. Buying on a local retrace has been steady, on volume.



Cal/fringe



References:

Brazil Oilfields and Geology, from 2009: Sergipe Onshore Offering

http://www.brasil-rounds.gov.br/arquivos/seminarios/STA_2_Bacia_de_Sergipe_Alagoas_ingles.pdf


Brazil 4: Reconcavo

http://www.anp.gov.br/brasil-rounds/round4/round4/workshop/restrito/ingles/Reconcavo_ing.PDF



Petrobras Finds Oil in Fazenda Panelas Field of Reconcavo Basin

http://www.businessweek.com/news/2012-05-01/petrobras-finds-oil-in-fazenda-panelas-field-of-reconcavo-basin

Brookwater Tests Oil, Gas Shows In Reconcavo Basin

http://www.epmag.com/Exploration-Reservoir-Evaluation/Brookwater-Tests-Oil-Gas-Shows-Reconcavo-Basin_97991

Tullow is no Stranger to South American Offshore Oil

http://online.wsj.com/article/SB10001424053111903285704576559941258722316.html

and

http://www.businessweek.com/news/2012-03-30/bp-bg-group-total-tullow-to-explore-for-oil-in-uruguay

“Tullow, which holds a 27.5% stake in the discovery, operated the well and said oil from the reservoir should be relatively easy to extract. The company also said the discovery proves its theory that major oil finds in offshore West Africa can be replicated in South America.”



Red