pre-open games?, page-15

Hi Sandys,

Just having some fun. Agreed have learnt heaps off this forum, heaps and have constantly thanked those people. I have money invested, money I can afford to lose, but I do not invest to lose, so I try to control those factors. I was lazy when I joined this forum (having been feed broker reports etc. previously) and followed the "It Crowd" until I worked it out.

I gathered information and read on o&g and found SSN. I wanted to bring a different angle to things, like this:

To understand a business you need to understand the End in Mind - what is the end game - survival or new strategy?

What do you think the end game is for SSN? This is my thought - They want to change from focus on Gas to Oil - read the strategy statement, why? Well I never really understood either as they had producing gas why sell - that was my lack of knowledge (whcih still is limited but better than before). So I educated myself.

Here is my thoughts:

What drives Income in any business - it is activity not the $ figures (it is not the "scoreboard"). So what are the key values to drive SSN - price of oil/gas x production rates. What is the price of Gas? What is the price of Oil? What is a fair BOEPD?. I have read numerous amounts on this forum $20, $40, $80 - but would the answer not be it depends of the above mix - if you have more gas and less oil you have a lower BOEPD price - correct?

Calculate the BOEPD - what do you get for September 10? I will give you the answer - $40 odd dollars hence my bugging the Dalek for information.

Now calculate and I mean really calculate what the Bakken wells will produce and expand this out to June 2011 - What is the new BOEPD number without gas - it ain't $40, what is the turnover and how much do you really lose in income when you sell the gas?

Now add the cash position from the sale of the Gas properties - do you think we are closer to today or this time last year cash position (sorry skyrocketer)? - Now count the wells (1 left to drill in Bakken) you have producing x BOPED with the higher rate and what do have? Answer - work it out.

Now once you have worked out the cash position at June 11 - divide this by the number of shares and add up all the assets they now have? What share price do you have? How much lower do you think it will be from today?

Notice did not mention Niobrara, Diamondback, CHK.

Now how much risk do you carry comapred to other stocks and there is your decision to hold or sell?

Now add the "Potential" revenue streams above and what do you potentially have? do not know but higher than 5c that much I know.

Now do things need to go right - Absolutely, Is their risk - Absolutely, Would I suggest you put your life savings in - Absolutely Not, can you still lose - sure. Want to sell, it is your investment do what you want. Don't want to invest - it is your decision alone I am not telling you to do anything, giving you a price target I am just sharing information - this is not advice what to do.

This is not a spec stock/DT stock whatever you want to call it - it may go back to 5c or 4.5c or it may not - I really do not care I may buy and sell to make some small time money, because the chart I look at is different and they need to deliver but if they do, and in any investing "IF" is a big IF then you will make money, how much I do not know. Will it change your life - read TB presentation do you think he dreamt it up one night and out it out there to ruin his reputation?.

I couldn't care less about top and bottom - I may not hold to the end and if I see a reason to sell I will.

Do not take my word for it only, for then you are no better than I was, do the calcualtions, challenge them and make your own informed decision - it is the game plan not the scorebaord for LT investors, the scoreboard just tells you how you are going in a point in time.

You think I talk crap, no problems, I have given my spreadsheet caluclations to other posters - I do not have to, I do not hide behind the smart arse posts of this is a disaster to stir the pot. I put myself out there because I want to learn and I would rather be told my calculations are wrong now than find out the hard way.

This is what my chart tell's me.