Greets all,I can?t tell you how good it is to be back! I?d like...

Greets all,

I can?t tell you how good it is to be back! I?d like to thank the moderators for silencing me as I tried over and over again to explain why JPR was a Short Term Sell... back when the fully paid share price was hovering around $0.07/share and the options somewhere between $0.016 and $0.022.

Maybe no one listens on this site and perhaps its impossible to change someone?s mind ? or should I say, perhaps its not possible to logically explain additional factors that ?punters? will absorb and factor into their decision making. I?m sure you all think you?re open to logical discussion but the majority don?t seem to be demonstrating it. You?d really have to question both the rational and honesty of the people that have been saying ?I topped up AGAIN today? ? no matter how low the share price goes. I mean, are those the people you want to believe in and trust?

I?m going to have a crack at explaining a few factors again this time (I don?t know why but I am?)

- What is the main factor killing the share price? I can tell you now that it is the number of shares on issue.

- What is the main thing that will bolster the share price? It?s FLOW rates of oil/day.

- Does the amount of oil in the ground affect the share price? Well yes ? if they can get it out fast enough, but NO if they cant!!

Lets make some assumptions:
Shares on Issue going forward: lets assume options wont convert and guestimate at 850m no issue (who know though because the company keeps taking the ridiculous step of issuing more every 2nd day it seems!!!)

SOI: 850,000
Profit/Barrel: AUS$30
Basic discount rate: 5%
Days of production/year: 350
% of profits returned to share holders as dividends: 60%

Some FLOW rates:
Year 1: 1200 bopd (2 wells)
Year 2: 1950 bopd (3 wells)
Year 3-8: 2650 bopd (4 wells)
Year 9-12: 5% degradation/year (4 wells)

Now ? YOU DO YOUR OWN HOMEWORK. Spreadsheet these variables. Move them a bit ? look at the optimistic scenario and the pessimistic. The one above is middle of the road I think. How much would you pay per share and what return do you want on your investment.

I?ve worked out what I think is a fair return (dividend based) for 3 years, 5 years, & 12 years. I personally use 12 years to give me a share price.

I challenge you guys to post some of your outcomes up here simply in this fashion:
- 3/5/12 cumulative Earnings Per Share (EPS)
- 3/5/12 cumulative Dividens Per Share (DPS)
- Rational for a current value of the share if you took a 12 year view. Bear in mind you have to recoup your original investment, plus a profit that is some level above the risk free rate of return (ie. MORE than what you?d have if you just put your money in the bank!)

- What would the NPV be of $10k invested now for 12 years, and the NPV of $10k invested in JPR at current prices.
So whats it to be ? put your money in the back (and earn interest which you pay tax on) or invest your $10k in JPR?

- Which makes the most sense logcically ? take your HOPE out of the equation?

If you?re a current share holder, or thinking about becoming one you should already have done these calcs (of course). If you don?t have time to spreadsheet these fundamentals (but you?ve got time to read and write on these boards?) you definitely haven?t done YOUR OWN homework and you definitely should not post anything up here because you don?t know your FACTS. This is the definition of doing your own homework, so go do it!

A couple of additional notes;
- You can HOPE all you want that something MASSIVE is going to change the reality but at the end of the day nothing underpins the value of the share over time more than the fundamentals of return on investment (charts are just a tool in the tool box)
- There are NO institutional investors (or ?instos? as some try hards are calling them) of any note lining up to get into this company - you think they buy shares in companies with a billion shares on issue and flow rates that might reach 3k/day?? Think again!
- Personally, I think the short term capital raising using equity are appalling management decisions. The only thing that can make it worse is if the options get in the money and convert ? that wipes an immediate ~25% of the value per share ceteris paribus.
- Fully paid shares are not called ?heads? ? who made that garbage up?
- Lastly, if you?re all such long term share holders, and you all know that if everything goes to plan they?ll have 2-4 producing wells in the next 6-18 months, why are you even worried about the current share price? (Probably option holders on the verge of doing your money at a guess?)