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Gold/Mining/Energy : Central Pacific Minerals & Southern Pacific Petroleum -- Ignore unavailable to you. Want to Upgrade?

To: Thomas M. who wrote (20)	7/22/1998 3:49:00 PM
From: Lu_Xun	Read Replies (1) \| Respond to of 90

Regarding Mr. Miller's comment in his 6/15 posting that the conversion ratio on CPMNY ADRs and SPPTY ADRs is 2.7, that is not technically correct, as I understand the situation. The last annual report put out by CPMNY indicates that, given the estimated reserves of the total project, the partnership interests of the various partners, and the fact that both CPMNY and SPPTY own significant blocks of shares in each other, CPMNY shareholders are essentially acquiring an ownership interest in 2.71 times as many barrels of oil per share as the SPPTY shareholders are acquiring. This, of course, means that CPMNY is the smarter purchase whenever it's shares are quoted at < 2.71 x the quoted SPPTY share price. SPPTY shares are the better purchase whenever the quoted price on CPMNY shares exceeds 2.71 x the quoted SPPTY share price. I assume this is essentially what Mr. Miller meant to say in his posting but his word choice ("conversion ratio") seemed to imply that there was some preset point at which shares of the one entity can be converted directly into shares of the other. Such is not the case to my knowledge. Hope this small clarification is helpful to prospective buyers of these securities. Lu Xun