I think all the nellies are out in Friday;s bloodbath. The nellies and t3'ers that were caught in the stock for days would have sold to cover the settlement costs at any price yesterday.
I fully expected that sell down in all honesty.
What I think a Monday announcement will do is lock out these players (at these prices atleast) as they would have been licking their wounds and not been in a position mentally to buy back in of Friday arvo.
If there is no announcement on Monday, so of these may enter, but of greater concern is whether there is a real problem or not?
A little birdy has told me that we will have results on Monday, the DST complete and the well drilled to terminal depth. I dont know what the results may hold, by given the offloading of the U assets last week (effectively increasing GDN's reliance on gas), the Oceanic investment for what has ALREADY been discovered, and my belief that mgt are dump founded by the markets reaction to date, I am betting on a productive well at this point.
I also think that the comapny will soon run wire line logs and get ready for well completion procedures.
Who knows whether it is 0.5-3 tcf in the field, but a producing well will support the current shareprice (and the rest) and effectively allows a free hit at the U spin off and upside potential in the gas field.
The U announcement was also of interest after such a period of wait with the asx. I think that whatever the contentious issue must have been has been removed from the announcement. Must be something, just ask yourself WHY a near term producer in White Canyon would dilute its stake in its own asset with 1.9M lbs. For What?? Could it be that Thompsons is more than mets the eye, and was this the asx's main concern.
If so, it raises the question - why are the directors so keen to offload this project? 2 answers are more probable to others, 1> they are confident with the gas field and hence will focus of this play and provide shareholders the upside potential through a divested vehicle, and raise cash for the next stage of gas development at the same time. OR 2> they are desperate.
It would seem that with a 6 mth leadtime to the announcement, this was ongoing after the initial drilling results in Oct and has probably gathered pace in recent times.
Another point is that if this well were a duster, surely the company would have P&A'ed a long time ago, rather than fudging their way through a capital raising with 'smart money' and continuing on in a whipping a dead horse scenario.
All in all, it comes down to a vote of confidence on the management team and their attempts to maximise shareholder value. I dont think they are punting on this each day saying geez only x feet to go, I hope we find something. Then, if you think mgt are acting in the best interests of shareholders, analyse the results to date. They have been good to significant, not the big bang yet but solid.
I also think that mgt is fully aware of the free loaders on their registry. The word on the street is that a number of brokers were not very happy with the TH and suspension locking in all of there clients for a week, clients that could NOT settle. Apparantly the concerns of the company's actions were made clear to GDN. WHo knows? but if this were the case, a clear trading day prior to results may be enough to clear these free loaders out.
time will tell, let's wait for pre-open Monday!
GDN Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
