Hi Dknow,
Thanks for this post of yours, and bringing a bit of sanity to the thread. So many posters immediately jumped on the "speculation" wagon when CNE started climbing last night.
I been "sidelined" for 2 weeks for being naughty (should not have referred to management of a certain company as BSers (supposedly defamatory?????). Fact is "defamation" can/will not be established/proven (mind you - it is one of the most difficult "causes of actions to claims" to prove) if what is said about someone, is in fact the truth. I spoke to the truth (backed up my assertions that "they were BSers" with concrete facts). Yet I was "wiped" for 2 weeks and could only sit and watch and read all the posts of posters during this exiting 2 weeks that has gone by.
As for last night, I couldn't understand why people would simply speculate on SP rises without, at least, trying to see what is the "cause". The immediate cause to me was in fact the 3 new oil discoveries by Cairn India. Yes, hotkiwipav shed some light on the issue but I cannot agree with him totally. Point is, (and yes I acknowledge that CNE now only owns 10% of Cairn India - by the way oligarg - (and again I would urge that people do a bit of research before drawing conclusions of making statements without foundation) CNE used to own cairn india - 100%. Inian company Vedanta purchased 58% and then another 3 odd percent from CNE. Vedanta purchased a further 18% on open market and I think another 10 odd percent from a state owned comp which left CNE with a 10% holding). True HKP, the oil discovery yesterday (another 3 wells in a block where they already had 46 discoveries - big deal - not) should not affect CNE SP. It's easy to make that sort of deduction - less is is the question - If not that, then what? What caused the CNE SP to move so strongly yesterday? According to HKP even the Senegal drill is insignificant to CNE due to the SIZE of CNE and the other much greater problems that they have. So much so that Senegal would also not affect CNE.
So what makes the SP move? I think HKP is totally wrong on the impact that well results will have on CNE. CNE is not, I repeat, NOT, that big. It is small compared to other oilers (and about 8x(?) the size of FAR - thats not big. CN said Senegal could be a "company maker" . If a big one comes in, it will affect CNE big time (IMO but time will tell). I agree with WASA on this - at least 20% jump in CNE if Senegal comes in. So the question to HKP remains, if it's not the Cairn India discoveries (and it really shouldn't be but who knows) and Senegal will not impact CNE, then what is the cause for the type of SP movements we saw in CNE SP last night? What is the cause? It's easy to say that some factors are not the cause or will not cause and impact, but then there has to be something that causes the movement - Could it be that India Taxation office is leaning towards a decision to "Forgive" CNE the tax liability - Could be - who knows. Any event. I'd like to think that it is more likely "news" from Senegal leaking bit by bit and which is now giving rise to some accumulation.
The recent financial report that came out, it seems nobody actually read the whole report. Did anyone notice on the last few pages where it's been stated that the overrun costs is nore likely to be in the region of 28Mil and not 24Mil. There is concern on my part that FAR will be in serious strife without getting a very good farmout in place immediately. As such CN in London for extended time.- To address overrun costs trough some equity sale deal coupled with farmout.
Also remember - there was an article some time ago which quoted CN as say that the the L6 farmout will not happen before the end of the 3 quarter - AT THE VERY LEAST!! That suggests that CN and the farm-out proponent are waiting on Senegal. With the increasing blowout of of overrun costs, I'm speculating that those "overrun" costs" will be in the "mix" of any farmout deal (perhaps with CP or Cairn. Could also be that FAR is selling down 5% of equity in Senegal to cover overrun costs and freecarry for future drilling in Senegal, coupled with the sweetener of giving the L6 farm-out to one of these big boys.
Enough said for now. Let's enjoy the FAR ride.
Forgot to mention - I'm somewhat dissapointed to see how "the tough got going when the going got tough" Separating the sheep from the lamb.
I fully understand Gotta's reason for selling. And by his own admission - he recognized that he sold to early. He didn't make excuses. He sold in accordance with his rational thoughts when the SP looked tantalizing. Then there were others that sold out totally or portions( to be freecarried) and in accordance with a particular strategy that were in place when they purchased in the first instance (i think they are in minority). Then there were those who simply jumped ship - there were quite a few of them -and I found it amusing how all those who sold (out of fear mostly) then had to share their reasons for selling ( the one poster actually "URGING EVERYONE" to do the same.
Guys- all for themselves. Personally, those that jumpewd ship (and I'm definately not including Gotta in this group) deserve to be out of the stock at this stage.
Those of us who have been in this for a long time and now why we are in this (and I'm sure I speak for the rest like Wasa and a few other) would have viewed yesterday's debacle with amusement - not a worry in the world. Because we know why we're in this.
Good luck for all those that hung in there yesterday. Good things come to those who wait.
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