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Gold/Mining/Energy : Canadian Oil & Gas Companies

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To: Bobby Yellin who wrote (69)	8/14/1996 5:05:00 AM
From: Kerm Yerman	of 24925

International Petroleum Corp The company (IPC) is an independent Canadian oil & gas exploration company incorporated under the laws of British Columbia. However, the company is operated from offices in Dubai, U.A.E.. Through its subsidiaries the company has land holdings in six countries with a producing field in the Sultanate of Oman (30%) and a major developement project underway in Malaysia (26%). The company also has an interest (31%?) in three blocks of acreage in Libya through 54% owned Red Sea Oil Corporation. IPC also has a feasability study underway on Papua New Guinea offshore acreage (48%) where they will be the operator. There are 42 million shares outstanding, 25% owned by management. The company has been active since 1986. Shares trade on Toronto Exchange, Nasdaq, Stockholm Exchange and on the International Exchange. Yorkton Securities issued intitutional report 9/1/95 recommending IPC whose shares were trading at time @ $4.40/share. Moss, Lawson & Co Ltd issued an institutional report on 3/12/96 recommending IPC whose shares were trading @ $3.20. These two brokerage firms are Canadian. Both recommendations were based upon an asset play. Shares were considered undervalued when comparing Net Asset Value to Share Price. Assets consist of Oman production and all other acreage and reserves discounted at 15%. Shares have since increased in value to over $6.25/share. Investment at this time would appear to be of a high risk nature. The company has already come a long way in regards to market capitalization versus net asset value. Their first drilling in Sudan came up empty and well was abandoned. The key behind any further investment will be developement of their Malaysian play. Any production won't be realized until sometime in 1998. If you own shares currently, I would recommend holding. This is a long term investment situation. Also, be on the watch for share dilution brought about via new share issues which may be requred to financially support projects. I also recommend contacting the company asking if they have any copies of institutional analyst reports issued over past six months. Kerm

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