ann out, page-14

Before the GFC the SP at SPUD would skyrocket, however,
post GFC... people are more realistic. Why buy in before you know the results? - fair enough you get in at a cheaper price but you also take on a huge amount of risk. I think smart investors now buy in after the fact - knowing oil has been found and knowing when a company will start production (and turning a profit - which is the only thing that adds true value to a company).

This got me thinking... everyone is posting figures based on a successful drill outcome, such as '20cents, 40 cents' etc. But would we even get close to those numbers POST-GFC?
I mean seriously... even if we hit oil... so what? its an exploration well, not a production well - if we hit oil then we go on to drill another exploration well to test the size of the play... it could be a long time before a production well is underway (and therefore a long time before we turn a profit and the SP goes up).

People talk about takeovers, but I doubt a company would takeover FAR based on a single drill... they would want to know how big the play is (which usually requires multiple exploration wells).

I hope I do not sound to negative, but I am trying to be realistic. I do currently hold shares and have done so for many years - and I hope the well is a success and I hope the SP does go up to 20c+... but I am starting to see the same patterns all over the stock market... people saying 'If drill X is a success we will all be super rich'... and it so very rarely eventuates... but what does happen much more frequently is that the well fails... peoples hopes, dreams and money go down the drain and then 6-12months passes with a low SP plateauing and then another drill happens and people start beating the same drum all over again.

I am starting to think 'buy when a stock crashes - after a bad result and sell before the result is known'

Just wish I could take my own advice... because I am not selling :/

Ele.