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Lol. And the coaster jumps the track, takes out a few innocent bystanders (unpaid vendors, Belize villagers, landowners with unplugged holes) and blows up spectacularly (shareholders lose all equity). All occurring when the train operator (management) left the control panel after the initial ascent.....
This is why I'm here. Imagine what Tullow and/or Dana would pay for 37% of an 8bboe field. They paid $305M for additional 1.75% to 3.5% in Ghana for a 2bboe field?
26 May 2011
Tullow to acquire the Ghanaian interests of EO Group Limited for $305 million
Tullow Oil plc ("Tullow" or "the Company") announces that today it entered into a conditional agreement to acquire the interests of EO Group Limited (EO), consisting of its entire interests offshore Ghana, for a combined share and cash consideration of $305 million.
This acquisition will increase Tullow's interest in the West Cape Three Points licence offshore Ghana by 3.5% to 26.4% and increase the Group's interest in the world-class Jubilee Oil field, which Tullow Operates, by 1.75% to 36.5%
I think they are ramping up commercial production of the fields around Jubilee field.
I'm no expert. Just saying I assume the drillers just don't like the risk of JDZ right now. I'm waiting to buy back in after more about Kenya comes out. I just like HDY right now for the short term.
I forgot I posted on RB before this board took off. Don't have any other handles. I invested initially way back in 2001 but got out around 2006-2007. Not back in ERHE but in HDY for time being.
Yeah but Ntephe is always going to pump the JDZ. That's his job. It appears the fact of the matter is that oil operators just find better prospects elsewhere in West Africa. They haven't run out of opportunities yet to try and relook at the JDZ.
Sounds likes the failures in the JDZ are still haunting the EEZ's interest by drillers. I still find it hard to believe that Sao Tome doesn't want to accelerate exploration. They need to talk to Tullow or some reputable Western company with experience in West Africa as compared to Sinopec or the other Chinese novices.
Been a long time since I sold my shares in ERHC (was back in the JDZ days). I'm trying to catch up on my DD and I'm seeing all Kenya talk on the board. Is the EEZ not in the pipeline at all?
You guys are looking too much into it. Having consulted to hedge funds and mutual funds for 7 years you learn the high frequency trading machines make up most of the volume in low volume stocks. That's why you see large swings when there is an order of significance because its actually a buyer putting in a limit order.
And I doubt anyone is tax selling. A sophisticated investor would know they would have to wait 30 days to buy back in or the loss won't be recognized (tax "wash sale" rules).
The MMs and HFTs will keep this above $3 so they can keep writing worthless options. I expect the move to happen when Tullow announces that West Leo is en route to the drill site. Then the fun really begins.
Bought some near the low in my HSA. I'm going in large in January when I sell my 2013 gainers. See us just bouncing in 3s until news of rig en route to drill site.
Any thoughts on valuation if they find 1 billion barrels? I'm not an oil expert so I can't accurately forecast expenses to get a proper valuation.
Just throwing numbers out:
Tullow gets to recoup its cost form the oil first,
Guinea gets up to 60% of the oil money after those expenses (I'm ballparking numbers for simplicity) and HDY gets 37% of that 40%.
1 billion barrels * $100 price = $100B. If there were no costs to drill the well and refine the oil, HDY would have $14.8B profit. As that's not the case and there is a lot of expenses, profit potential is likely to be what? $5B over the life of the well? That would put the company at a sickening $238/share which would be almost be a 100 bagger. Thoughts?
Uhm yes.
1) A shareholder meeting is not where you say you spent $1M of your own money on stock. Nobody cares and its public record what the executives own. And BTW, CC stands for Conference Call and this was a shareholder annual meeting.
2) Volume doesn't matter right now. The only volume is when someone buys or sells a block of shares. Everything else is just MM "noise."
3) And I'll buy when I want to, thank you very much.
Maybe it was RL adding to his position after bragging about spending a mil on stock at the shareholder's conference (which actually made him sound stupid since we can look up his holdings in the proxy filings).....
I'm still waiting to buy in. There could easily be a run up to 4 pre-drilling but I expect somebody to panic and dump shares beforehand.
junk is right. Not to mention there is transaction, legal, due diligence, and other fees that were capitalized in the cost of acquiring the lease to begin with.
Again, unless the buyer was a dunce, they wouldn't offer a good price to someone who has just purchased a lease and is trying to get out of it as quickly as possible.
Good post. It's obvious TECO took a loss on the sale. Unless the purchaser is a complete dunce, they know that TECO is hurting for money and would adjust the purchase price below what true fair value may be.
Talk about overpaying a new controller!!!! 130k for someone who has only four years public accounting experience and who doesn't have to do much work?!?!?! They could have gotten someone for 90k.
Market isn't thinking anything because there is no market. The stock is thinly traded and most of the activity except for when a big block goes through (like 3:24 when somebody bought 25k) is just MMs trading.
It's not the start of anything. SA is just a forum for people to post stories supporting their positions. In this case it's just one guy who thinks the reward outweighs risk (which we all here do).
The interest will come once we get closer to spud date.
There will never be a forward split. Unless the CFO is completely incompetent, the exit strategy should be to keep the O/S as low as possible, strike oil, and make a deal with Tullow and Dana for the rest of HDY's percentage by buying out HDY's stock.
Reason? Taxes. Royalty income from the oil would be taxed at a corporate rate of 35%. Dividends from the remaining cash would then be taxed at 15% to 23.8% depending on individual taxpayer situation. That's too much leakage.
On the other hand, selling the stock in HDY gives an investor a capital gain which is taxed anywhere from 15% to 23.8% if long-term capital gain. That gets you much more shareholder value (less cash to government) and HDY was never going to become more than a Guinea oil play.
Ok, so I listened to the recorded shareholder conference last night. I thought it was awful. Except that HDY actually has shareholder votes due to being publicly listed on a real exchange, it sounded like a penny stock conference.
1) Incompetent introduction ("The calendar year ends on June 30th." HUH?? You mean FISCAL YEAR?).
2) Not impressed with RL. I've heard Watts before but that was the first I heard of Ray. Didn't sound sharp and couldn't articulate clearly when needed. You should sound pretty dang confident about your company when giving a presentation, not like Eeyore from Winnie the Pooh (yes I said that!).
3) The Q&A was a joke. He only answered a few questions. Responding to the NYSE listing requirements and the "How will you increase shareholder value?" questions was a joke. Anyone can look up the requirements and the second question is freakin' obvious: find oil. Its like RL choose those questions on purpose since they were softballs that required no substantive answer.
4) 35 minutes? Really? Couldn't spend 1 hour which is usually what earnings calls last? Could have answered a lot more question such as:
a) exit strategy
b) details on $1M/month cash burn
c) Has Blackrock showed any interest in additional financing?
Overall not very impressed as a said. HOWEVER, the risk/reward is too good to pass up. I'm waiting to see if it falls before $3 early next year where I will consider adding.
The well is expected right now to cost $115m per the 10-Q. I think we all know the cost is likely to creep up which is my concern since they are responsible for their share over $100m.
If you see some major purchases sub-2.50, you will know who that is..... I'm just waiting on the sidelines. I've followed HDY and ERHE for 10 years (bought ERHE at .04 in like 2001-2002 and sold for .30 first penny stock play, never bought HDY because Watts could never get his act together).
I'm just not buying they don't need additional capital right now. A delay in drilling and then they have to raise capital when everyone knows they are distressed. The villagers will bring out their pitchforks when they announce another R/S and plan to raise $50M at the same time....
I know they have money in the bank, but what if the well costs $150M because of some setback? HDY seems to have had issues of not forecasting worst case scenario.
I'll listen to the recorded webcast, but were the shareholders in attendance total buffoons?
1) WHAT MAKES UP $1M CASH BURN A MONTH?
2) How do you expect to raise more funds? (Assume capital raise)
3) How much cushion do you have on well cost overruns?
4) WHAT IS EXIT STRATEGY? (Pay dividends? Sell company to Tullow? While a smart CEO would not give a definitive answer, you ask the question to see what he says on a "spur of the moment" occasion).
5) Why does the board need to be paid compensation currently? That ties up cash. Can't you defer payments?
So HDY said they aren't going to have to dilute for the well costs? Interesting. I don't know if I buy that unless Tullow extends them credit before raising more capital.
Why are any s/h's still holding? There is now ZERO catalyst to the upside with Belize being dry. And just look at all the promissory notes being paid with shares. That's a sure sign of a penny stock about to implode or to eventually R/S due to dilution.
How is this company even trading when its CIO and CFO just resigned and the financials show its insolvent? The shares should be trading at 0.0001 and not 0.01.
So can someone tell me the following (which you think a responsible company would tell its shareholders)?
How was the Chile investment acquired?
What was the price?
What funds were used/will be committed? Where did the funds come from? Dilution?
Has Chile approved the sell?
Is this a one man operation? Appears to be only a CEO.
Guys, the stock was pumped this morning by an email newsletter: BullseyeStox. That's where the volume came from. Someone likely loaded up before today and dumped into the email pump which took away the gains.
May I jump in: get ready for what? From my limited perusing of the messages on this board, the executives have sold off major chunks of the working interests. Even if this company did hit oil (remote chance), they'd likely get less than 50% of it. Perhaps even below 25% since we probably aren't even aware of all the backroom deals made. Meanwhile the executives get paid, take nice trips on the G&A account to Belize, and have zero to show for it.
Ready for breakout in next 2 weeks. We've been consolidating for awhile now. Time for earnings and good guidance.
That was the share purchase Kerkorian made thorugh his investment corp Tracinda when they had the stock offering of $1B in May.
Don't expect much until Q2 is released first week of August. Hopefully we get positive earnings. Then the ball gets rolling. Maybe a win for the Aqueduct Racino in NYC, 2 big boxing matches this fall, and CC opening.
lol. Maybe they can hire an IR firm too!
I will be pleased to inform you that my full 5mil did get filled at .0001 and nothing less. In addition, I still have my millions in SPRL in my Roth IRA that I will not sell (as I could care less about a loss and stilll hope it goes up).
Sorry guys. I dumped the 5 mil today. I need the tax loss. I'm making a boatload in MGM and LVS and I'm trying to keep my tax AGI down as my Roth IRA contribution for 2009 is up 1100% in MGM and LVS call options. I'd hate to have to convert it to a traditional and then reconvert and have to pay tax.
MGM: Undervalued relative to LVS
Once MGM gets amendments to its loans (its gonna happen, especially after WYNN's restructuring), I think we can see a serious upswing. While I don't like to compare to LVS as I own/like both stocks, MGM shoud trade higher than LVS upon putting BK to rest. Just compare the O/S:
As of 12/31/08
MGM: 277M shares
LVS: 642M shares
which gives a market cap of (based on today's closing prices)
MGM: 1.68B
LVS: 4.76B
I know LVS has 2 casinos going online in the next 10 months (Bethlehem & PA) which will garner faster revenue/earnings growth than MGM in 2009, but LVS just doesn't have the earnings potential of MGM in the aggregate. MGM owns way more casinos and a economic turnaround, along with CC going online, can provide a huge amount of earnings over LVS.
I think an honest valuation would be for both companies to have the same market cap. LVS due to its earnings growth with less casinos and MGM with its overall earnings with more casinos. This means MGM trades on a PPS basis higher than LVS in order for the market caps to be equal since LVS has 2.3x more shares outstanding.
Just my 2 cents while I'm drunk upon returning from the bars. ;)
At least we have LT holdings periods! Gains is another story. haha.
No updates on sunbiz.org. They have to file an annual report sometime soon with Florida. Unless they just have given up.
I thought about selling this. But since its been near worthless for so long, might as well play the roulette wheel and hold.