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Microcap & Penny Stocks : HITSGALORE.COM (HITT) -- Ignore unavailable to you. Want to Upgrade?

To: Q. who wrote (4315)	10/3/1999 5:07:00 PM
From: Janice Shell	Read Replies (1) \| Respond to of 7056

More from my friend who used to be in the oil business: Its a far several light years stretch between oil rights and a promissory note. An oil lease or the rights is just that... it has nothing to do with oil production, damn you could buy an oil lease in Manhatten and drill, but the results and return may suck in a large way. A lease is just that, you pay the land owner a lease to drill, if you hit the well then you pay the landowner a lease and royalties. Damn I still dont think anyone will buy a promissory note just because you have an oil lease, are there any reserves under the ground???? Actually he had more to say, but it wasn't all that clear because he couldn't stop laughing...

To: Q. who wrote (4315)	10/3/1999 8:54:00 PM
From: Daniel Chisholm	Read Replies (1) \| Respond to of 7056

Here's another inconsistency. With the recent increase in the price of oil and gas, the production on these leases created a cash flow of over $1.5 million this past month. ...$900.0 million Promissory Oil Production Note... a cash flow of $1.5M per month is $18M per year. Assume the well lasts forever, and use a discount rate of 5% (ha!), and you might argue that these cash flows have a Present Value (i.e., are worth) $360M. (Of course a more reasonable analysis would look at free cash flow, probably reserve life, and use a discount rate more like 15% -- this would value this oil resource at far less than $360M, say, on the order of $100M!) The information that LFT has given seems to contradict their assertion that their Production Rights are worth $900M. - Daniel