Time for a reality check after Mike Mulshine's email.
Interesting but this letter gives no comfort or indication about what Treaty will actually do. Almost all what he says is "jam tomorrow" and a lot of what he says is just plain misleading IMO.
As Mike Mulshine is from Osprey Partners, I am suprised he has not added the normal rider about forward looking statement to this email.
IMO several things he says are misleading:
- Treaty "has made incredible progress since...". Well - IMO it hasn't delivered any real value for its shareholders yet and its production track record is pathetic.
- I hope what he says about Texas wells is right, but remember the proverb "If it appears too good to be true, it is too good to be true". IMO Drilling a $160,000 well to produce 30 bpd sounds too good to be true. If this was a sure investment others would have made it before Treaty ever got anywhere near it - as I don't see what unique attributes Treaty bring to this.
- Treaty Energy Corp, may be in the top 1% of penny share companies in terms of acreage holding. But IMO it is nowhere near the top tier in the world. Nearly all national oil companies and all multinational oil companies (I am not aware enough of all the indepedents operating in the world to include them in this statement) have far more acreage than Treaty and all have them have turned it into a lot of oil reserves already.
- Belize with more than 55 years of oil exploration has only succeeded in producing a maximum of 4500 bpd. So IMO talk of 100,000 bpd is not just pure fantasy, it is out of this world. My research indicates that no geologist has ever understood Belize enough to know how much oil there is to be found or where it is, and as Mike Mulshine nor Treaty don't seem to have done much in the way of geological studies of Belize there is no way that they could know either IMO.
But I don't want this post to be all doom and gloom.
The reality is:
- Treaty are drilling in Texas and the actual production results of the first few wells will establish their investment track record (for shareholders) and ensure that the lender will come forward with funding for the full well program
- Treaty have access to a really big acreage portfolio in Belize but IMO operational problems have prevented them successfully exploring this so far. They need to move forward with drilling, at their site near Independence Village, with the objective of proving up commercially producible oil
