CoreStream Energy, Inc. (fka ZLUS)

[nowhere2be]

Dolphy, this post by andrewjoseph was the key.

it got brutal and unbearable from this point on. but good. it should of.

SOME RED FLAGS and some things to know about this stock and the oil business in general.

Leases are not 18 to 24 months ever. Oil and gas are produced for 20 to 30 years. They srop off exponentially from when they are first completed. It gets to a point down the road when the cost to operate the well is more than it takes in.

This "PR" is a red flag to me. The fact that they have placed casing unto the well isnt news that they just discovered yesterday. They would have been doing tests during drilling and would have done some test pumping to determine how much fluids or gas are present. This whole PR is old news that should be very obvious to all stockholders that were following along.

Another negative is that they only working intrest in the well, the lowest form of ownership. They also arent the operators, so they have to give up a percentage to another oil company. They pay all of the bills while royalty and overriding royaly pay nothing.

They would also know how much interest they have - they say in this "PR" that they still have to work out the numbers. This is an outright lie.

People take a percentage of risk and ownership in the drilling phase. If the well produces enough to complete and lay casing and move in a pumping unit, then you pay the same percentage to finish. Obviously if its determined that its worthwhile to complete the well, people are quick to pay their share. In fact, you are required to pay the finishing costs otherwise operators that front your money to finish take 300 percent more out of the proceeds from the completed well than they kicked in.

There is also very little risk in the completion phase with all of the technology we use now. This statement that they dont know how much working interest they have is total BS.

"All investors who participated in the exploration phase of the well are expected to participate in the completion phase as well. Due to these ongoing completion activities, the final calculation of CoreStream Energy, Inc.'s net working interest percentage has not been finalized." - This is insane

With all of the shares out there, OS of one billion, at .005 apiece are overvalued.

Heres why:

In that part of the country it may cost 100k to 200k to drill and another 100 to 200k to complete. A small time oil investor like myself regularly takes one to two percent on their own. This would mean buying 10 or 20 million shares apiece with this share structure. 10 or 20 million shares would cost 50 to 100k. The numbers dont make sense when you look at it this way.

I know they own more oil properties currently, but they dont produce that much oil for how many hands are dipping into this pot.

They say they are drilling more oil in the area after this - more good news to come. Well, thats obvious to anyone that know about oil. The landowner makes you drill more wells to bring it up quicker, it called drilling out the property. These are low risk wells that produce less and make the first produce less because they are all targeting the same zone of oil.

This well might make 20 barrels of oil per day. But you cant take 20 times 88 time 30 to see how much revenue they will generate. We know the landowner will take a cut off the top, usually an eighth -12.5 percent. The operator takes some, from 2 - 6 percent, so now you are at mabye 16 barrels per day, if we had the entire rest of the well, which is not likely. That is also probably why they arent telling.

Most wells dont have enough or clean enough gas to run themselves, so they require electric or gas, which costs money. It adds up because they run 24/7. then you have to pay the shipping costs which are figured by the cost of transporting to Oklahoma City. This should not be more than a few dollars per barrel.

There is a reason why the pps didnt jump today and thats because the news isnt that great when you know what you are talking about.
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People need to do some DD here other than just getting excited and then checking the price of oil and shouting.