This thread has long been dominated by non-holders expressing negative comments. So far they have been right, but we have to question why non-holders, in numbers, waste their time posting. I thought I would post why I continue to hold. Gulf South would have done due diligence and have vastly more and better info then shareholders. They are paying $500,000 dollars for a half interest in wells the Company says cosy $250,000 to drill and equip. That gives $750,000 "profit" per well with the capacity to drill more than 100 per year. Leaving aside outright fraud, the reserves are not likely to be less than half the previous announcement. Still impressive. These reserve calculations were over a part of existing acreage. The Company has acquired a lot more ground and has already released a fair chunk of this new ground. This tells me that considerable resources have been directed to evaluating this new ground and given that some has been released, a fair number of dusters in the evaluation wells. This is sound strategy, if it does not excite the market. The extra ground should more than make up for any "down grade" on the old ground We have enough information to believe that there are high pressure reservoirs at depth. More experienced drillers and better equipment should bring success here. Emphasis on published "profit" is misplaced. All accounts are prepared in accordance with the appropriate tax law and in the USA, all drilling and development expenditure for oil exploration is written off as incurred. Published "profit" figures tell very little about the real profitability of the operation.
FDM Price at posting:
24.5¢ Sentiment: LT Buy Disclosure: Held
