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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: Dale Baker who wrote (118962)	3/13/2009 3:49:31 PM
From: Ed Ajootian	Read Replies (1) \| Respond to of 206092

Dale, one of the reasons I've sold most of my PRC is that I am concerned that they will have to write off all or virtually all of their Williston Basin PUD's due to the fact that those reserves are not economic at these oil prices. They may also have to take an impairment charge on the value of their unproved oil & gas properties for the same reason. I could well be wrong about this, I guess we'll find out in a coupla weeks. As far as I can tell, all of the old "rules of thumb" for valuing E&P's have gone out the window unfortunately. In the case of Baseline, I can't see how they will be able to get any financing at this point, given that they have not been able to so far.

To: Dale Baker who wrote (118962)	3/17/2009 7:36:42 PM
From: FJV	Read Replies (1) \| Respond to of 206092

Dale, I am usually a lurker, but I am also a PRC investor. I had an interesting conversation with the former IR guy for PRC today. He indicated to me, strictly investor to investor, that although this quarter will probably suffer as a result of write downs that EA alluded to, PRC has some compelling positives. First, they put on some hedges earlier last year at over $100 per barrel. Second, they seem to have a good relationship with CIT, so maybe the write downs won't severely impair the availability of credit for operating capital. Third and most important, is that PRC's total reserves are now about 10 million barrels. Acquisition deals in Houston these days are going for $18/barrel (in answer to your question) for what is still in the ground. With only 36 million shares O/S, it is clear that PRC's break up value is far in excess of its current paltry SP. Yes, this would be mitigated by any debts needing to be paid, but even if you reduce the reserves valuation by half for the debts, it still leaves you $2.50 per share. And that's worst case scenario - the company can no longer continue to operate and needs to sell out. At this point, 25 cents a share is a joke IMHO. Take it for what its worth. Franco