Replies to post #12553 on Addax Petroleum (fka AXC)

[ssc]

Depends how one defines "normal market activity". If one takes it to mean every tiny oil exploration company that shares in some way with drilling a well automatically sees its shares go up prior to drilling, regardless of financial condition, reality will slap you down faster than you can say "delusion insurance" and you were in for a big (and expensive) disappointment.

On the other hand, if one takes it to mean the market punishes a company that relies solely on toxic debt for its existence, that sells off huge chunks of the company for a couple of million dollars, and has no problem diluting its shareholders into oblivion, then the erhc stock action came as no surprise.

[midtieroil]

Nobody trashed ERHC. What was said was the truth about a company where the management refused to disclose material facts about this company. The 18.8% chance of success was a fact that management only selectively disclosed.

The debt was highly toxic yet management did not disclose that the convertible debntures had no floor until I figured it out. The equivalent of 300 billion shares were issued as a result. You think maybe that affected any predrill run-up?

And the phony tax receivable stayed on the books for months even after the company lost in the Tax Court twice. That turned a $2 million receivable into a $2.7 million liability. That also resulted in a tax lien being placed on their assets.

Then, ERHC refused to disclose the Tarach dry hole for months even after multiple reliable sources had already done so. In fact, they had some convinced it was a discovery when it obviously was not.
Sorry but I don't consider telling the truth and exposing cover-ups as bashing or trashing.

Apparently some wanted an orchestrated predrill run-up devoid of material facts so they could dump their shares on unsuspecting shareholders while material facts were being hidden. Too bad that didn't work out and I'm glad it didn't.
I have no desire to profit on that type of deceit. And I seriously doubt that I was the only one to figure it out. The market did too.

By the way most companies don't have predrill run-ups. The last four I have investded in haven't. So much for the myth that all stocks run up prior to drilling. They don't. And that is even more true for a poorly run company like ERHC who didn't even have the cash to pay for the well they were drilling let alone survive a dry hole.