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It was actually sarcasm, not comedy, but you got the gist...
Badge - why on earth would Hemi PR that? You know from KA's posts and PR's that he is always worried about the competition learning what Hemi is up to. Do you realize how damaging that would be to our SEK leases if all the competitors in the area knew there was a pipeline only a half mile away... shhhhhhh!
BigMur - I totally agree with you. Now is not the time to be making deals for sale of the company or assets in light of their Natural gas reserves. Look at these excerpts from Chesapeake Energy's 9/23 PR. CE holds substantial production / leases in Hemi's core areas of Barnett and Haynesville shale as well as the mid-Continent geographical area.
Chesapeake Energy Corporation has announced plans to reduce its drilling capital expenditure (capex) budget during the second half of 2008 through year-end 2010 by approximately $3.2 billion, or 17%, in response to an approximate 50% decrease in natural gas prices since June 30, 2008 and concerns about the possibility of an emerging U.S. natural gas surplus in advance of increased demand from the U.S. transportation sector.
The company plans to reduce its current operated drilling rig count of 157 rigs to approximately 140 rigs by year-end 2008 and expects to keep its rig count relatively flat through 2009 and 2010.
In addition to reducing drilling capex, Chesapeake has elected to temporarily curtail a portion of its unhedged natural gas production in the Mid-Continent region due to unusually weak wellhead natural gas prices that are substantially below industry breakeven costs. The company has curtailed approximately 100 million cubic feet (mmcf) per day of net natural gas production (approximately 125-150 mmcf per day gross) and plans to restore this production once natural gas prices recover from recently depressed wellhead price levels of $3.00 - 5.00 per thousand cubic feet (mcf). This curtailment represents approximately 4% of the company's current net natural gas and oil production capacity of over 2.3 billion cubic feet of natural gas equivalent per day (92% natural gas).
Source of article: http://www.oilvoice.com/n/Chesapeake_Energy_Corporation_Provides_Operational_and_Financial_Update/0153d069.aspx
Thank you Kels - I believe you helped me make my point w/o actually intending to do so.
Do you really think it's realistic to ask most potential investors to fly / drive to Ft. Worth or SEK or ND to view the assets and meet the Hemi folk??? Most potential investors reading your post on how to perform DD on this company will just move on with that kind of answer.
I do truly thank you and Big for trying as hard as you do to keep up with the company's progress and sharing your findings with us fellow investors. Heck, I wouldn't have known that the ND deal had fallen through w/o your post of Keith's email message the other day.
Do I trust you 100% on all your posts, not exactly, but do believe you are in HMGP as an individual trying to make a buck on the company along with the rest of us. I just don't think you should have to work that hard and pay out of pocket like you did to go to SEK to find out info this public company should be providing on its own.
DL2 - I've had a similar thought along those same lines. Figured it would be too costly though for the company to implement.
I was thinking of some kind of meaningless reverse split like 99 for 100 to force any "air shares" out into the open. In theory, those brokerage acct's holding "air shares" would have to buy real shares to surrender them to the TA for the accounting change in the number of shares. It's probably a lame idea but there should be some way to capture the true amount of shares out there held by individuals and make sure they are real. That could really boost the SP.
Peter - I too share your frustration with this investment. Earlier this year, I kept buying HMGP systematically in 500-1000 dollar amounts. As I started to see less and less follow through with the PR's, I slowed my buying and then totally stopped. Not saying it was just me, but the price has steadily down trended since then from 10 cents to 7 cents to 5 cents to 4 cents to 3 cents. I think a lot of the iHub shareholders quit buying and this is why the price has trended down. I guess MM2, Kels and Big can't pull up the price by their own buys.
I think when the new potential investor "Contractor" posted the other night about wanting data on this company, it sums up the real problem here. Isn't it ironic that they had to post a request on a message board to get data like assets, lease locations, financials, production amounts, etc. How many new investors are interested in this stock when they can't find out this basic info from the company itself. Would you trust your dollars to a bunch of anonymous posters to answer your DD questions? Just because most pink's lack transparency, it doesn't mean you have to... Maybe that's why 90%+ of pinks ultimately fail.
Contractor - Welcome to Hemi. You ask good questions but unfortunately, Hemi - and most pink's, don't provide much in the way of concrete numbers like the type you ask about. The stated goal is for the company to use its oil production to stay out of debt and be cash flow positive to buy assets (leases) and to build up reserves through selective drilling. Their core holdings are in SE KS with ~10k acres of both oil and gas (coal bed methane and conventional that is presently not produced due to lack of a pipeline and the needed infrastructure). Monthly oil production is somewhere between 500 and 1000 barrels based on my best guess and their last official PR stating Jan-Feb 2008 numbers. Very small lease holdings are in the shale plays of ND (Bakken) and in TX (Barnett and Haynesville).
The endgame is supposed to be having the company bought out by a larger company by 2010 or there abouts.
As per my original post, I believe the insurance settlement is the single biggest event in Hemi's near term future. Bigger than even the Collins well short term IMO.
If the settlement is indeed in excess of the $1 million amount, this is huge, almost the present market cap of the company. What would they do with that much cash??? Buy back some stock, install the NG infrastructure, drill some offset wells on Collins??? The end results could be extremely bullish for the SP.
If there is no settlement, or the insurance story was a "carrot" that never materializes, then the credibility of KAA and Hemi is shot and we investors are doomed.
It's been well over a year now since the floods, what is the timeline for the insurance settlement in typical scenario's? I resent my unanswered August email to Hemi about the insurance claim again today to see if I get a reply this time. I will post the reply here if Keith gives me the approval to do so.
Man - you are correct about the small font on that chart. I have a 'zoom' feature on my mouse that let me max. in on the axis to read the date. The easier way to confirm the data was to choose the option to download the data instead of drawing the chart. That option will show the data in a table rather than a graph. Dates are nice and readable!
Here are some FAQ's from the "Fail to Deliver" website regarding their data. Unfortunately, I don't think it confirms or denies any supposed HMGP NSS manipulation.
How often is this data updated?
This data will be updated as soon as the SEC provides a new update. The last update included 2nd quarter 2008 data and was added on 9/4/2008. The SEC releases the data quarterly.
How accurate is this data?
The data is directly from the SEC which states "We cannot guarantee that the data will be posted by a particular date. We cannot guarantee the accuracy of the data." For the purposes of charting, the SEC data was adjusted by this site in the following way: Where the SEC did not track closing prices, they had inserted a "." into the data. These "."s were changed to "1"s.
How did the SEC track this data?
From the SEC: "The values of total fails-to-deliver shares represent the aggregate net balance of shares that failed to be delivered as of a particular settlement date if the balance is 10,000 shares or more. If the aggregate net balance of shares that failed to be delivered is less than 10,000 as of a particular settlement date, then no record will be present in the file for that date even if there are fails in that security. Fails to deliver on a given day are a cumulative number of all fails outstanding until that day, plus new fails that occur that day, less fails that settle that day. The figure is not a daily amount of fails, but a combined figure that includes both new fails on the reporting day as well as existing fails."
What is a Failure to Deliver?
A fail to deliver is recorded when a seller does not provide the shares of stock that were sold within the required 3 day settlement timeframe. From the SEC: "Fails-to-deliver can occur for a number of reasons on both long and short sales. Therefore, fails-to-deliver are not necessarily the result of short selling, and are not evidence of abusive short selling or “naked” short selling."
Interesting website, not sure why HMGP data is so old though. If you "dump the data", you will see that the last numbers come from August 2005. 3 plus year old data in today's market is kind of meaningless.
I viewed a couple of other pinkies I follow but do not own. The data from them are complete up through June 2008, quite a difference.
Maybe all the share data of HMGP is "gagged"???
If flood insurance works like auto or home insurance, the premiums must have went through the roof when Hemi put in a "million dollar plus" claim last year.
Wonder if Hemi is still insured? If we had a financial statement, you could possibly see a line charge for flood / equipment insurance.
Wouldn't it be ironic if Hemi collected a million dollar plus insurance payment that was larger than the oil production revenue for 2007.
I sure hope BAC doesnt' buy, it's my largest holding by $'s and I sure don't want more dilution or debt on their balance book...
apples and oranges Jagman - your example of misbehaving mgt. would probably violate SEC laws but would not be libel. On the other hand, Ovidius accusing mgt. of using an anonymous ID on a message board to manipulate the stock could be ruled as libel... You may want to read up on U.S. court filings:
http://www.usatoday.com/tech/news/2006-10-02-bloggers-courts_x.htm
Badge - even if your number of shares is correct, that gives a market value of ~$480K (before taxes). If you look at it as "deferred compensation" for 5-6 years of effort at Hemi as CEO, it doesn't seem like that much money to me...
That's about what my family gross was the last 6 years and I'm no CEO...
Since that accusation would be highly illegal, that is probably a libelous statement. Go ahead and step in a little deeper and tell us, Ovidius the Oracle, which Hemi employee, by name, was DD2.
Thanx DL2, Badge also sent me that profile link... I wasn't able to decode the DD2 acronym into the real ID name to find that myself... Should prove to be highly informative (and entertaining) reading for me...
Badge - thanks for the DD2 profile link.. That should be some very interesting reading for me to get into...
It does look extremely fishy that he totally went invisible on 8/8/2007... Must have met his financial objectives and went underground.
DL2 - the reference to DD2 is new to me as far as HMGP. Must predate my involvement here at iHub and the HMGP board. What time line was this apparent Pumper serving the koolade so I can go back to the old posts and get caught up on that angle of the HMGP story.
Your premise is totally illogical... What sense would it make for KAA to "milk this dry without needing the price to go up". Let's say he has 20M shares total, what is his benefit with the SP at 3 cents and steadily going lower? Don't you think with that kind of share count he would want the price to be going up?
Now granted, I think his actions as CEO has directly led to some of the weakness in the SP by keeping the companies assets and finances too private. What I don't think is that he is purposely allowing or somehow desiring the SP to tank.
Lowman - I too would like to see the "final straw" that let you make that 180 degree switch on HMGP. Wonder if it was a single large event or just a series of small things that "cleared your mind"???
Mine was 0.24, almost exactly a year ago!
Anyone who went short on this or other finance stocks in January are standin' in High Cotton now!!!
Is that the all time low DL2?
C'mon REAZO, these KS drillers are businessmen, not turnip farmers... I find that scenario quite outrageous, you really think any vendor would discount their billing if only HMGP would allow them the privilege of issuing them stock instead of cash???
If they think HEMI's prospects are that wonderful, they could just take the cash and buy HMGP, it trades every day from 930 to 400.
Very well stated. I would do everything possible to discourage the issuance of new stock if indeed HMGP is as far undervalued as mgt. keeps stating. The SP is what it is and apparantly HMGP has few financial choices to turn to.
If a vendor wants HMGP stock in lieu of cash, KA can just say, no thanks - don't want to dilute at these prices. Here's our check...
Start of new HMGP marketing plan??? My Google alert sent me this one tonight. A company newsletter called QualityStocks has Hemi as one of their daily highlighted stocks. Here is the news article from TransWorldNews, don't read too fast or you might miss the Hemi paragraph:
http://www.transworldnews.com/NewsStory.aspx?id=61066&cat=8
Sorry to hear about the financial hit today Kingpin, you've been a steady long term bull on HMGP since I first arrived at iHub in May. I do hope that your large holdings of 500K shares is a very small percentage of your overall portfolio.
FWIW to others, I think its good financial advise to keep OTCBB Pink's to a very, very small percentage (1 to 3) of your investment capital. I do worry that some here in HMGP may have a very large percentage of their net worth in this one stock...
@Med.R - thanks for the PM. I don't have PM to reply('cept for 1 hour on Fridays) so will post publicly.
That would indeed be a good strategy to employ in some situations. My case though it would not work since my lots I would like to sell are changing status from ST to LT in less than the 31 day window your strategy would need. Good tip though - you know about the "wash sale" tax rule - that shows good trading knowledge!
REAZO - your LT / ST tax implication grasp looks correct. LT gains are more favorably taxed but that is a chance one would take to do the tax loss selling this year. I want to sell my ST losses within the 12 month window to offset other ST gains I have in other investments. Remember, my strategy is to only sell two of my lots, those with high cost basis. I am keeping my lots that have buy points in the 4's, 5's, 8's and 10's...
Why do you think there may be a big SP increase next spring? I thought the long awaited buyout was out in 2010 or there abouts??? I am hoping that a Collins lease drill program would get some favorable results and the SP could move up based on some nice revenue from production. But starting at .037 a share, do you think a 400% gain is realistic to put the SP back in the mid teens based on drill results? Maybe a perfect storm of lease sale PR, insurance settlement, new well completions could cause this... That would be a very nice event indeed!
That was one of your funnier comebacks... I got a good chuckle out of that one actually.
This board is often very entertaining, that's one reason so many seem to hang around and view/post even after their positions are closed...
You must have a strange definition for the word "complaining" as you apply it to me. I prefer to use the word "realistic" as to my posts. I offer o/g knowledge to the board in a best forth effort to both educate and inform on my take of the PR's and let investors make their own decisions based on fact. I think that should be the ultimate purpose of investor boards like iHub. Put out facts, debate company decisions, speculate (best guess) on things as long as you disclose it's speculation and not fact.
FWIW - in full disclosure - I have yet to sell any of my HMGP but plan on doing so at the right time. I have two buys, one in the mid 20's and one in the mid teens I would like to sell for tax purposes. Right now, with the price in the 3's, I think the risk is high that we could see a bump that would be a better time for me to exit these two lots. I would be a buyer again in 31 days depending on future PR's and alternate choices for my $'s.
YES - I do know some that are selling. With the end of the tax year fast approaching, I think it makes good tax sense to take some losses to offset other gains for the year to avoid taxes. It's prudent tax planning. I think about 98% of HMGP investors have paper losses at present so it would be advisable to take your loss and buy back 31 days later if you so choose to reestablish your position. This will get you in compliance with the "wash" sale tax rule. My 2 cents...
An update on the "insurance settlement" would be nice. This is from the June 2, 2008 PR:
The insurance claim process is continuing to move ahead for the major flood damage in 2007 to our five mature producing oil leases in Woodson County, Kansas. This claim is more than $1.2 million, and additional information has been gathered this quarter by the insurance carrier. Hemi has already funded all repairs and upgrades, therefore all monies funded from this claim will be available for future development.
Do you folks realize how huge this amount of money would be to the company? I think that this is more of a potential SP mover than any new well, Collins included, based on the amount of money in question. I think it is so important that every Hemi PR should provide an update on this claim settlement. $1.2M is about 2 cents a share based on 58M shares outstanding.
Badge - no reply at all. I have had other email questions / comments that I have sent in the past that Keith has answered for me. I didn't resend the email either so I can't know for sure if it was received and he chose to not answer.
I choose to give a company the option to answer email at their leisure rather than to phone in, so that's why I don't call Keith or Hemi.
This was brought up around the first of August by a fellow iHub poster. I liked the idea so much that I wrote KAA an email pointing out the posters comment and that I too thought it would be an excellent plan to shake up the MM's and any shorts.
For whatever reason, I did not get a reply....
professor of economics at NYU
So that's your support source? I am sure he/she would be totally unbiased in backing up your democrat -vs- republican view of economic history.... lmao
Fox was right, your last comma in the dollar amount should have been a period (decimal point) ... $612K sounds about right.
I think that also makes Badge and I correct too...
Darn, was hoping this was actually some positive news...
Kels - so do you think this is a production result from a New well on the Reno lease or some kind of New completion on an existing Reno well?
There is no NOI for Hemi on the Reno lease going back 365 days. If this is a new completion of an old well, then I think this is a positive development and would have come out in a Hemi PR. The SP could use any positive PR's it can get right now. Mid .03's already this week, that's a lifetime low isn't it?
I also think that the Hemi "tanking" strategy should be implemented in an uptrending oil price environment, not a downtrending one. Oil was mid $140's when KA announced this in a PR. Now at $106 and dropping, seems like you would want to sell each tank as quickly as possible...