Tracer Petroleum (TCXXF) Message Board

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Gold/Mining/Energy : Tracer Petroleum (TCXXF)

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To: George C. Grasser who wrote (589)	4/15/1998 2:12:00 AM
From: Jim Daly	Read Replies (2) of 1261

Okay folks, here's the news. I talked to Ed Mowatt tonight. I wanted to clear up several questions that I had about the recent developments with Tracer. He was very forthcoming and answered all of my questions IMHO honestly and fully. I apologize in advance for anything that I might say that is inaccurate or unclear (it's almost 2a here) My intention is to convey the gist of the conversation. I asked Mr. Mowatt if he would mind if I posted anything that we discussed and he said "just so long as it is accurate." I will try my best. 1: What happened to David Robinson? Mr. Mowatt said that he couldn't say anything about Mr. Robinson's departure aside from the fact that it was an internal matter. 2: What happened to the private placement? It left with Mr. Robinson. 3: How will the loss of the private placement effect the planned drilling. Not at all. The drilling is funded and will go forward as planned. The site is being prepped for drilling. 4: What is the eventual use of the gas find at Muya 2? It will be used to supply low cost fuel for power on Borneo. The gas find at Muya 2 was substantial enough to warrant more investigation but not large enough to be developed for export. If the same well had been drilled in North America it would have been hooked right in. Unfortunately Tracer was not able to get full confirmation of the flow rate without damage being done to the test bore because of the inability of a sub to get the test equipment to site. They feel that based on the gas flow rate they were able to attain from the test bore (after repeated capping) that there is an excellent likelihood that there is also oil there. That is why they are drilling that site again. 5: What about the Producing Properties? Tracer needs them. The only way to grow is to pump oil. The only way get the producing property is to buy it with money from Private Placement (private loans) not a dilution of the stock. Tracer has no debt, for the first time in a while. The only way to get Private Placement is to have a stock listed on NASDAQ. A BB stock won't do. Lenders won't look at them. Mr. Mowatt said that he feels that Tracer is a lock for the purchase of those properties. 5: About the Consolidation We all have seen the recent post on SI. The post was mostly accurate and as we all know it contained references to consolidation of stock (reverse split). Tracer saw this post and released news the following Monday confirming it. Mr. Mowatt indicated that the board of Tracer had discussed the possibility of a 1 for 10 reverse split to keep the NASDAQ listing. But it was no more than a discussion. The release of that information caused them to act (the news release). He said that if Tracer doesn't get the consolidation it is sure that they will be delisted from NASDAQ and sent down to the BB. This will make it, if not unlikely, impossible that Tracer will get outside funding. Mr. Mowatt also assured me that he will not stand for anything more than a 1 for 10 split. He was adamite about that point. But he feels that it is a catch 22. Without funding they can't grow. Without a NASDAQ listing they can't get funding. They need the reverse split , although he hates the idea. In addition the recent stock price $.12- .156 US is well below the breakup value of the company. The raw assets are around $.36 a share. IMHO: Since Tracer has no debt the PE is meaningless. The company should be valued around their asset value. This being the case, even post split if the stock falls below $1.00 the stock is at a premium to asset value. 7: Volatility Yes, the smaller number of shares will cause greater volatility and could possibly drive the price lower. Then again the stock will soar higher on ANY good news released by the company. Volatility is not the killer that we think it is. But it can make for a bumpy ride. 8: The Indonesia Situation We all know that Indonesia is in financial turmoil. Mr. Mowatt (IMHO so do I) feel that is an advantage to Tracer. The exchange rate of 8500r to the $ makes for incredible buying power for North American Corporations. There are many American Oil companies in Indonesia and they are not rushing to leave. Suharto should be there for a while longer. 9: Hyping Mr. Mowatt said that he will not release news to solely move the stock price. The only news that we will see from Tracer will be on real events and then only after they occur. He will not hype. This is a condensed version of an hour conversation and by no means is it ment to imply that I am speaking for Mr. Mowatt. I am only conveying my tac on the answers to questions that I and likely you are curious about. IMHO! Tracer needs this reverse split as painful as it may be to the shareholders. The fact is that the inside holders of the company do not have enough leverage to insure that this will happen. We need to help make this happen. Since we are the company (shareholders) we need to help put it back into a good position. Whether you hold 100 or 100,000 shares do not dismiss this. If Tracer goes to the BB it probably won't come back. Regards Jim

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