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Gold/Mining/Energy : American International Petroleum Corp

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To: Elmetwally who wrote (1022)	7/31/1997 6:23:00 AM
From: Thu Ra Tin	of 11888

Saw this post on the USENET. Subject: aipn Date: Wed, 30 Jul 1997 10:58:20 -0600 From: dnj1@ix.netcom.com Organization:Deja News Posting Service Newsgroups: misc.invest.stocks, alt.invest.penny_st It seems some recent speculators bought with the idea that tiny aipn could develop a world class concession on its own and were surprised that the company only had enough in its kitty to fund the minimums required to maintain its lease for 5 years. That in itself should be very good news. One might want to compare aipn with Harken Energy ( HEC), a tiny canadian exploration co with a promising play in Columbia. HEC is trading on the AMEX with a market value of approximately $600 million and has just started drilling and seismic work on a concession that reportedly has possible reserves of 2-3 billion bbls. They have been fortunate enough recently to raise some $70 millions to do this. At the end of the day however, the Columbian government will take 50% of all production off the top, leaving HEC only 50% that they will likely still have to share with future drilling partners. AIPN starts with logs and seismic on some 15-17 wells that have already been drilled by the KAZAK government while under Soviet rule. The replacement cost of this work is some $40 to $50 million. The company has as its partner and a leading shareholder, the Kazak geophysicist that oversaw the initial work and apparently knows the concession better than anyone. Review by the company's outside appraisers. Huddleston, has independently confirmed his 1 billion + numbers in the western half. . They have not as yet confirmed his claims of additional possible reserves of 2-3 billion bbles in a major structure in the eastern area of the concession, the site of a blow out of environmentally damaging proportions while under soviet rule. Patience is required while management reviews its options. Bringing in a creditable partner is an excellent route to take. The arithmetic is compelling: 25% or 35% of proven recoverable reserves(or lower) of high quality light crude at $6-$7 per barrel in the ground would be worth far more than 70% of possible reserves valued at less than $0.10 per barrel (1.2 billion bbls only - more likely upwards of 3 to 4 billion bbls) At the recent due diligence meeting management disclosed that they had an offer by a $3 billion company for a 50% interest and another company to fund all the additional seismic work during the first 5 years in return for rights to sell the seismic to other oil companies after the 5 year exlcusive period. Management was also reviewing offers to raise outside capital by at least one investment bank. myrk@voicenet.com, a leading middle east scholar, assured me that the political risk in Kazakistan is far better than Columbia. If 2-3 billion in possible reserves is worth $600 million to HEC now, why wouldn't aipn be worth $200 million going to over $600 million (if Huddleston confirms the Kazak geophysicists numbers in eastern structure)? e.g. $5 to $15 per share and much higher as reserves are proven? -------------------==== Posted via Deja News ====----------------------- dejanews.com Search, Read, Post to Usenet

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