Ivanhoe Energy (Nasdaq IVAN) Research Report
Page 2-3 – Cont’d
TOXIC BOB GOES TO CHINA – And Fools The Chineese
***HYPE***
September 19, 2002 … Sunwing (IVAN subsidiary) “has signed a 30-year pro-duction-sharing contract with PetroChina covering approximately 900,000 acres with a gross natural gas resource potential of five trillion cubic feet located in the western portion of the Sichuan Basin, China’s largest gas-producing region.”
Wed Sep 3, 2003 … “IVAN, through its wholly-owned subsidiary, Sunwing Energy, has initiated operations on its two major projects in China. At the Dagang field, Sunwing has begun activities for a 50-million-barrel-oil development”
Tue Oct 28, 2003 … “Sunwing has a 30-year production-sharing contract with PetroChina… at $3 per thousand cubic feet of gas and before costs such as, capital expenditures, production expenses and profit-sharing payments, the potential gross revenues from the Sichuan resource could amount to US$15 billion over the life of the project… To date, PetroChina has successfully drilled 22 gas wells... All four structures drilled by PetroChina tested commercial gas with initial test rates ranging between two and 32 million cubic feet of gas per day”
ivanhoe-energy.com
***REALITY***
Toxic Bob’s promotion of the Petro China venture is interesting… His hype suggests he’s really pulled a brilliant move, getting the right to fund 100% of a drilling program near an area where Petro China has drilled 22 successful wells. Curiously, Toxic bob does not disclose how many failed wells PetroChina drilled.
1. With this right, IVAN also takes 100% of the risk, and MUST raise exploration capital of $219mm – money they don’t have;
2. IVAN Development in China is not new, it began in 1997. After 6 years of exploration in China and extensive HYPE there’s been no gushers for IVAN;
3. China exploration is IVAN’s greatest success at 500bbl/day for multiple wells, IVAN’s ROI on 6 years of exploration in China is negative. (cost vs revenue)
4. To explore or participate further in China, IVAN Needs to sell stock & SIGNIFICANTLY dilute existing shareholders;
Oct 30 IVAN SEC filing… “Under the contract, Sunwing operates the project and funds 100% of the development costs to earn 82% of the net revenue from oil production until cost recovery, at which time Sunwing’s entitlement reverts to 49%.” sec.gov
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Toxic bob also fails to mention that Petro China has the ability and capital to explore this area themselves. An area they know MUCH better than Toxic Bob… But instead, Petro China is going to give away E A S Y millions to Toxic Bob. Those silly, silly Chineese.
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Next Up - TOXIC BOB GOES TO TEXAS
IVANHOE ENERGY (IVAN)
RESEARCH REPORT PART TWO
Cont'd Page 2-3
Pluvia Securities Research, their agents, associates and or employees have investment positions consistent with the above-stated investment opinion. All comments are the EXPRESS opinion of the Author(s) - All rights reserved. |
