Liz,
The financial picture becomes clearer when the production rates are clarified and some of the debt is restructured to equity so that this company can resume its drilling operations.
Its obvious that this company has too much debt vs. its equity at this point, and the market is amply discounting this into the stock price.
My sources tell me the restructuring news could come out as early as next week. You may want to tell "the girls"(!) that it is time to cover your shorts. While the impending restructuring is obviously a negative event (there will be massive dilution to the current shareholders), that event is already baked into the stock price and once the news is actually announced the stock will finally start to go up. At that point all the bad news will be out and there will just be good news left. Production test results for the Fortenberry, announcement that they have identified 3 low-risk offset locations at Oakvale Dome, farm-in announcement for Old Ocean, implementation of the second tranche of the Shell financing deal, trading on the US BB, etc., etc.
We will be looking at a company with positive cash flow, and with a project that many experts believe is the single best play to be had currently on the Gulf Coast.
The next few weeks are gonna be real interesting. Can a shitty capital structure be overcome by phenomenal exploration success? We have the proverbial irresistable force meeting the immovable object.
Not sure where the thread manipulation thought is coming from. I recognize I've waffled with this stock, from hot to cold and back, over the last 6 months. What can I say, that is my nature. But one thing I can comfortably say is that everything I've said has been my honest opinion at the time I said it. No ulterior motives here. |
