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Gold/Mining/Energy : Solv Ex (SOLVD) -- Ignore unavailable to you. Want to Upgrade?

To: bigtoe who wrote (5970)	8/23/1998 5:59:00 PM
From: WTMHouston	Respond to of 6735

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To: bigtoe who wrote (5970)	8/24/1998 8:29:00 PM
From: mqmsi	Read Replies (1) \| Respond to of 6735

Bigtoe, I certainly enjoyed your reply to Larry's last posting. In the case of Solv-Ex, I don't believe there are any "innocent shorts." Below is an excerpt from the thread of Central Pacific Minerals (CPMNY) and Southern Pacific Petroleum (SPPTY), sister companies who have reserves in oil shale. Basically, it is giving investors a valuation of what a "potential barrel" of oil is worth in oil shale. The average of the companies is $.02784 per barrel, and as you can see, CPMNY has 247 barrels of oil per share, and SPPTY has 91 barrels per share. As far as I know, those "potential barrels of oil" are each of the companies main assets. Re: CPMNY & SPPTY (ADR's represent 2 foreign shares) Net Reserves: Total 24.1 Billion Barrels of which 11.502 billion are CPM & 12.598 billion SPP. This means 247 barrels per CPM(ADR) and 91 barrels per SPP (ADR). Thus, at US.$6 5/8 for CPM & US.$2 5/8 for SPP one is paying US.$0.02683 for CPM reserves & US.$0.02885 for Spp. According to Solv-Ex's web site, there are four to eight million barrels of recoverable oil in Solv-Ex's lease. Using the average (six billion barrels), each Solv-Ex share would have approximately 240 barrels of oil. However, in addition, according to the web site, the value of the alumina and TiO2 would each be equal to that of the oil. So back when Solv-Ex had both the mineral rights and oil rights to the lease, their value would be equivalent to slightly less than three times (240 barrels per share plus 480 barrels equivalent in minerals) that of CPMNY, or approximately $20. Back in June of 1997, CPMNY was trading at over $17 dollars per share. Solv-Ex with the "equivalent assets" in the ground, should have been trading around $50. Obviously, the $38 high that Solv-Ex reached was not unrealistic at all compared with these two companies. Now you shorts will probably say, well Solv-Ex doesn't have a process to extract that wealth from the ground. BUT CPMNY AND SPPTY DON'T HAVE A PROCESS EITHER!!!! In fact, from what I understand, they are about ten years away. All of their value derives from the potential value of their reserves, with no proven economical process to extract them. For the SEC to attack Solv-Ex because the price was too high, doesn't make sense. Why didn't they go after these companies as well. Is it because Exxon and Suncor are helping to fund these operations? I personally don't think the SEC will have a leg to stand on, unless they pursue these companies as aggressively as they have Solv-Ex. I think Solv-Ex has a process that will work. I can't believe that Larry condemns then from moving to the pilot plant to full scale production. The reason they went to the size of plant they did, is so they could buy equipment "off the shelf", which is much, much cheaper than having equipment custom built. And it is a myth in my opinion, that the process doesn't work, it just doesn't work in continuous mode, yet! Even if the Solv-Ex process doesn't work, the stock should be worth $10.68 per share today basing it on CPMNY's close. This is only taking into account the value of the minerals. For it to trade below $1, makes me believe that there is someone out there who certainly wants this stock to fail. I bought some Solv-Ex stock a few months ago, and there were three or four days when it traded below my offer, and yet my order wasn't filled. Does this sound like the market system working to you? It is going to be interesting when the stock is on an exchange again. To best of my knowledge, everything that I stated above is "True and Unfalse." Regards, Mark