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Gold/Mining/Energy : Canadian Oil & Gas Companies

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To: Darwyn Petras who wrote (5069)	5/17/1998 5:49:00 AM
From: Kerm Yerman	Read Replies (2) of 24921

Darwyn - All / Startech Energy (SEH/TSE) Can anyone identify the large blocks that were traded on Friday. Would like to know who sellers/buyers were. 880,000 shares represents almost 5% of the fully diluted shares outstanding. Current price is about 4X 1998 cash flow per share which presents an incredible buying opportunity if company meets their forecast. The company had a good first quarter and was only 600 bbl's/d short of their 1998 exit rate production target. This is a company that has a good record of forecasting and grows annual reserves and production at a high double digit percentage. There hasn't been any public news. Could be disappointing drilling result - possibly in South Dakota. That's the worst scenario. Strong possibility is dilutive effect of 5 mil share offering which increased fd shares outstanding by 33%. However, I would of thought the market had factored that already. Last, could be institution bailing out of oil shares. If that be the case, let's award them a dunce hat and put them in a corner. My forecast for cash flow in 1998 is anywhere in range of $1.25 to $1.50. I have no idea who covers the company and what their forecasts are. My estimate is based upon 20.2 mil fully diluted shares and 50% of 1998 crude production locked in at $19.60. My 12-month personal price target is $9.00+ and I thought 6X forward 1999 estimate cash flow come next May 1st was deserving of a company with their annual growth rate record. We need to find out who the sellers were Friday and then proceed to investigate a little further. ---------------------------------------------------------------------- FOR THE RECORD My Previous Posting techstocks.com

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