A MUST READ observation from another HDY investor, FWIW.
"It is his oil exploration experience and Hyper’s management that kept this thing going, on a shoestring at times, to the point we are at now. I have read "The Prize" which is a very good history of the oil business worldwide. What struck me is that most all of the Super majors that exist today were started by a lone guy wandering around finding oil, and making it big once they found it. To be sure, eventually somebody else would have found the oil and gas, just like somebody else would have discovered the theory of relativity if Einstein had missed it. Likely it would not have been some time for the reasons, internal to Guinea, we are now discussing on a daily basis.
Please keep in mind that the evaluation work that HDY has done, (very little I believe you said) has isolated 5 fields. One field had 1/2 trillion cubic feet of gas and 1-2 billion barrels of oil under it. There are 4 others to be heard from yet. While it is easy to dismiss these as smaller finds, many of us who were at last years SHM might disagree. I personally think there is a whole lot more that 1-2B in the area that has been shot so far, but If I am wrong I can live with the 1-2B + the 4 other fields.
Any amount of dd will tell you that management (other than Neil, Bob, Ty, and BOD member Red Poling) are not from the oil industry (I guess that leaves Kent and Harry and the other board members). That is true. What is not easy to determine is that some of us that know the company think it is conservative in what it releases. You might not believe it, fine, but please respect that some here (even the non pumpers, of which I consider myself one) think that the release of information comes at a maddingly slow pace, and then is very conservative in nature.
They are wildcatters in the truest sense. They took something that no one wanted, are in the process of turning it into gold and should get rewarded accordingly, according to the original terms they risked everything on. The fact that there are rats in the middle (Joe Dewalla and US Oil) does not alter the legal agreements that have been signed, and up to July abided by.
If it were another area of land untouched and uncontested I might see your point that they would have a hard time competing with the likes of Exxon. Even then I would remind you that perhaps Exxon does not have the best E guys anymore (research Ty and Bob’s history). On P or Production I will concede the point, Exxon is much better than HDY, no question, no contest. But that brings up a point I feel strongly about. In the 80-90’s when the Exxon’s of the world were laying off 25% of their workforce starting with all the E guy’s and turning themselves into essentially companies driven by financial guys, they changed the nature of what they could do in a business sense. They kind of boxed themselves into a corner of having to rely on other companies to do the exploring in the world and then they would buy up the companies for their reserves.
So my point is that HDY can use the majors for what they are good at, Production. Please believe me when I say that it is foolish to think that there are not major oil companies interested in this concession now. Sure they would love to have it clean if there were no Hyper around and it was “magically” known that there were 5 fields and the data was available to them showing their locations and best drill points for 4 of them. HDY has been talking to these companies for over a year about this area. They are interested. I am willing to take the gamble that some of these companies are still willing to do a deal with HDY once the PSA is done and dusted.
It is a gamble that hinges on the PSA, and as I have said I think they have a legal right, that in my opinion has been admitted by both other oil companies as well as the Guinea government. If I did not feel this way I would keep HDY on the radar screen and perhaps buy once the PSA was announced. I know people who are doing this and willing to pay $5 for the stock as they will miss all the risk. I can’t say this is a bad approach after having gone through the last 3-4 months.
In the end it is all a gamble we do with our own money. I am comfortable with the risk but have done a bit of research and have kept close to things. I understand and respect that HDY is not for all."
Best to all...place your bets before this thing takes off! IMHO
