We not the only ones who believe in...

We not the only ones who believe in OEL:

http://www.theaustralian.com.au/business/mining-energy/look-beyond-the-temporary-turmoil/story-e6frg9ex-1225869671928

Look beyond the temporary turmoil Robin Bromby From: The Australian May 21, 2010 2:41PM

EVERYONE who has called today has opened the conversation with the state of the market.

Yes, it is awful, and this pain will last for some time yet.

But Pure Speculation, after a momentary weakness of the knees this morning, has managed to stiffen the old spine and again see beyond the temporary turmoil.

Just in the past week, in print and online, this column has reported on (a) the McKinsey projections India's growth over the next 20 years and the new enormous demand it will create for raw materials and (b) how China's global search for energy will replicate in size its snaring of metals around the world.

And now we've found one commodity which is already in short supply in China and of which Australia has plenty. Our lips are sealed until you go out and spend $1.50 to buy Monday's The Australian

In his latest weekly client note, Warwick Grigor at BGF Equities takes another swing at the man he calls Kevin Chavez and further pins down the argument that the new super tax can't work and that the Prime Minister wont be able to explain it to the increasingly worried electorate.

But Grigor also points out there is an upside to the shrinkage of the Australian dollar's value, caused by the collapse of confidence in the way this country is run and the consequent repatriation of money from Australia.

But the falling Aussie dollar is, he says, going to underwrite huge cash flows for coal and iron ore producers, whose output is sold in US dollars but produced in Australian dollars.

"Investors have been bailing this week, but sensible analysis would suggest they may come back aggressively when they consider the cash flows," writes Grigor.

Keeping in a positive mood, Dave Wall at Hartleys has today put a "buy" on Otto Energy (OEL), a stock selling at 8.4c.

Wall said Otto had undergone significant transformation during the global financial crisis and had emerged in a strong position. OEL has $23 million in cash, no debt, production of 1730 barrels of oil and 4m cubic feet of gas a day from part-owned operations in the Philippines and Turkey, along with a prospective exploration portfolio.

A deal in the Philippines with BHP Billiton (BHP) fell apart at the height of the global financial crisis, but subsequently the major has re-entered and agreement, is paying for 3D seismic and may elect to farm-in later this year or in early 2011. This would enable Otto to be free-carried for two deepwater exploration wells.

"We interpret BHP's willingness to re-enter negotiations as bullish for a farm-out and consider it likely that a deal will be finalised," Wall writes.