From Garbage To Gucci

[tr8dervic]

HNR, I am shorting it.

1. 68 mil due to the Venezuela I.R.S. (Seniat) any day now.

2. New production sharing agreement with Pdvsa will drop HNR's share of production from 20,000 bopd in q1 to 6400 bopd in q2.

3. EPS based on above will be about .10 to .15 per share vs CURRENT analyst estimates of .33 to .35 per share.

Q2 due on or before 8/10/06.

4. Hugo Chavez has no love for American O&G co's operating in his country and is unlikely to throw a bone to HNR. Make an example of them is more likely imho.

I normally don't short stocks but in this mkt environment I thought I would share my #1 short prospect with all of you. Target 8 to 10.

Good luck to all,

Vic

PS: Brent, thanks for the invite.