Replies to post #7780 on Strat Petroleum Ltd (SPRL)

[Tanail]

come on dude.... this is a stinky pinky that is about to become a real compnay..... yes, you are correct on all of what you are saying, but the potential is huge and that is after all, all these pinks trade on..... it sure ain't fundamentals ;)

cheers

b

[kozmo]

Two Russian Regions

"academy is NOT Rosneft". True statement, the Academy is in Bashkorstan (Urals), and the Rosneft presentation was in Stavrapol (Northern Caucasus).


BASHKORSTAN
[APR 27 PR] Strat Petroleum announced that its joint venture entity in the Republic of Bashkorstan, Strat Nafta Ufa (SNU), has acquired three additional reservoirs totaling approximately 450,000 metric tons. Based on the official market value of approximately $80 per metric ton the value of the reserves acquired are approximately $36 million. SNU's total reserves now amount to approximately 750,000 metric tons, with an approximate value of $60 million...... Along with the acquisitions, SNU has received the required Government approvals to construct its processing plants at the locations of the sludge reservoirs.

[OCT 25 PR] Strat Petroleum........ has completed a letter of intent to form a joint venture with a private European entity to begin processing of the oil sludge reservoirs acquired by its subsidiary Strat Nafta Ufa (SNU) in the Republic of Bashkorstan......financing for the first unit has already been provided and mutual commitments have begun; the first shipment of approximately 150 barrels of crude oil to be provided under contract to a local customer at a profitable price will be delivered on October 27th.

[NOV 14 PR] Strat Nafta Ufa (SNU), its joint venture in the Republic of Bashkorstan, has completed the initial shipment of processed oil from oil sludge.

[DEC 14 PR] While overseas, Company management presented their solution for the treatment of oil sludge to... a number of local oil and chemical companies at the Academy of Science in Bashkorstan. The end results of the presentations were very positive. Strat was able to sign a joint working agreement directly with the Academy to process an additional 2 million tons of sludge.


STAVRAPOL
[DEC 14 PR] The Stavrapol presentation also proved fruitful as the Company was able to gain acceptance of its solution by Rosneft for application to that company's numerous sludge pools in the Region. Strat is currently completing a proposal that would see a pilot plant installed in early 2007, followed by plants at additional locations as determined.

Rosneft is the world's second largest company in terms of proved SPE oil reserves and Russia's second-largest hydrocarbon producer with production of over 1.72 million bpd... In 2005, the company's revenues exceeded $24 billion USD.

In order to capitalize expeditiously on these opportunities, Strat is working in conjunction with its technical and chemical consultants towards completing the design and specifications for the pilot sludge processing plant expected to be installed by the middle of Quarter 1, 2007.



It would appear that Strat is demonstrating ability to process sludge in two ways - by installing processing units at refineries (Bashkorstan) and by processing existing sludge using chemicals (Bashkorstan/Academy and Rosneft/Stavrapol).

[Hurricane_Rick]

siaubus

Perhaps I missed the post where someone was calling for $5 per share. I generally don't take those too seriously, nor should anyone else...so I can really only comment on your questions/issues at hand which I find suspiciously skewed towards antagonism in the face of what amounts to an extremely positive piece of news from our little Canadian O&G outfit.

The PR today was another example of Strat's accursed "damned-if-they-do-damned-if-they-don't" PR legacy. If they came back and didn't PR a thing, somebody would be upset. Here they do, and some people are upset. Regardless of the intent and the positivity inherent in the communication, there will always be someone who calls attention to the gray lining from the clouds. Don't get me wrong, it's fine to be vigilant in our investments and SPRL has deserved its share of healthy skepticism over the past 2 years based on a perceived lack of execution that they really have themselves to blame for. However, like the inverse of a die-hard long, do not let that skepticism obscure facts and reasonable judgements.

Now to your points...

1) Academy is not Rosneft.

Agreed. There are two primary news items contained in today's PR and the two should not be mixed up. I might even contend that Strat should've released two PRs to distinguish the two which would've avoided confusion while also providing a double dose of news for investors to ingest separately. Nevertheless, the PR was poised as an update on results from their latest trip to Russia and both items were mentioned together.

Although the meeting with Rosneft does not imply Strat is doing business with them at this point, shareholders should still be excited that the management team of this miniscule Canadian O&G aspirant is in discussions with and presenting to the 2nd largest petroleum company in Russia and the 2nd largest oil company (reserves-wise) in the world. Somewhere along the line I've seen many people lose focus on just how big of a deal this is.

The mention of Rosneft also satisfies two other items. For a long time Strat management has been made to keep quiet as to who they were dealing with. I'm not sure if Rosneft is one of the companies that required NDAs or not in the past, but this PR provides validation to the contacts that our management has with Russian oil giants...and they're not just meeting them to take a few swigs of Stolichnaya. The Rosneft exposure provides another validation with regards to the Russian news articles that came out of the Governor of Stavrapol's office/web site. Some people dismissed the meeting as not being meaningful and questioned why Strat didn't issue a PR. This PR validates the due diligence that people on this board uncovered weeks ago.

Most importantly, regardless of whether the presentation yields business between Strat and Rosneft in the future, the simple bottom line is this:

I would rather have Strat presenting to Rosneft than not presenting to Rosneft.

2) 2 million tons of sludge.

This was the Bashkir Academy of Science part of the PR. Rather than acknowledging and perhaps congratulating Strat's management for TRIPLING its access to the resources that it will use to generate future revenues, you choose to discredit the entire JWA by hypothesizing an unknown revenue-per-year formula as if Strat will never see dime one from these sludge reserves when in fact they have provided various formulas for extraction rates in past PRs.
http://biz.yahoo.com/bw/061114/20061114005837.html?.v=1

Strat is building a company from square one. With the niche of sludge processing they essentially require 3 things...

1) Sludge
2) A method to process sludge
3) A way to deliver/sell the byproducts

If they had PRed that they have the method for processing sludge finalized, based on your current argument it is not a stretch for me to assume that you might say, "Great, Strat can process sludge, but has no sludge to process." Expecting them to settle all three of these initiatives at once is just not realistic; however, if you read the PRs over the last 6 months you will see that they are addressing all of these issues as concurrently as possible. And we have been witnessing them all come together over the past 6 months or so.

Perhaps what should also be acknowledged is that the company did deliver on an earlier stated goal from June...

"Strat Nafta Ufa (SNU) reserves now total in excess of 1,000,000 metric tons with an official market value of approximately $80 per metric, valuing the reserves acquired at approximately $80 million. Strat Petroleum, in conjunction with its joint venture entities, will continue its discussions with the various Government agencies and regional refineries to acquire an additional 1 to 2 million metric tons of reservoirs."

http://biz.yahoo.com/iw/060601/0132586.html

I'm assuming that the 2 million announced in today's PR is the same 2 million referred to in that June PR.

3. Where is the follow up of Nov 14 PR?

Here's what I would do if this really bothers you...forget that Strat even mentioned that they will be ramping up to 150 bpd in the next 30 days. Nobody should be expecting a PR for this milestone. If they release one that would be great, but by expecting one when the company didn't specifically say that they would let us know when they reach that kind of output will only frustrate you into coming up with more incorrect suppositions and failures. It will also probably lead you to sell prematurely. Perhaps if they don't update within the next week you should initiate that slide in share price by unwinding your position and cutting to the chase.

For historical reference, on 10/25/2006 the company stated in a PR that their first delivery of 150 barrels of crude would be delivered on 10/27. When 10/27 passed without a PR, some people started to get in a panic and irate that the company did not PR this event and then concluded everything from it never happening to it being a scam. Nonetheless the delivery was finally PRed on 11/14. I don't know what caused the delay, if in fact there ever was one, but that PR should not have been expected unless the company said it would specifically inform investors when that milestone had been attained.

In addition, the company's intent to acquire an additional 1 to 2 million tons of sludge in Bashkorstan was first mentioned in June. It took over 6 months to finalize, but that never meant the deal was ever off the table or they were withholding information from investors. It simply took longer than we expected. Sam & Co. are working on their timeline, not ours.

4) Nonetheless, the news is good, but until actual contracts are signed or proven revenues are streaming, don't expect price to skyrocket.

I agree 100% with you here.

5) anyone here studied math before?

I may humbly caution you that when you include a condescending comment like this in your posts, (and you haven't yet developed the cache of credibility to get away with it) that does not put you or your arguments in a light which may garner respectful or civilized attention...even if you include it with smiley emoticons. Just a little piece of advice you may choose to adhere to or ignore if civil discourse and understanding is your goal.

Finally, it has been my experience that shareholders, in particular message board anonyms, that levy what I believe to be unfounded criticism in the face of positive news, that formulate arguments founded in illogic, or that have a penchant for knee-jerk reactions, oftentimes are not the type of shareholders that have the same long-term aspirations of their investment that I do, and as such they do not usually stick around too long either by their own accord or by others. This has been proven too many times to count.

But maybe I'm wrong with you.

Regards,

Rick

[J.C.N.]

Siaubas,

You as a poster whether shareholder or not have every right to post and ask questions. Velvet gave you Sam's number and I am sure he would be more than happy to answer your questions.

No one has the right here to bash you or anyone else. The topic is SPRL and we can all agree to disagree without making it personal.

It does appear that many of your posts are bent to the negative or just seem that way. If your really looking for answers to some of these questions that we cannot answer Sam is your man.

Best to you and thanks for keeping it civil as the rest will too.

Brent