The absence of news regarding the pilot plant has probably got a few Linc share-holders rattled. But I wonder, could the plant already be producing?
I have no knowledge either way, and it may be wishful thinking, but consider the following...
1. Media articles / speculation.
-The 'Black Leaf Project', as quoted on another thread, says the plant is COMPLETE. I have no faith in these "buy a subscription and be a millionaire before lunch" type operators, but the rest of the article is fairly accurate.
-The Courier Mail article apparently says "Linc already has successfully tested its pilot plant at Chinchilla".
-From petroleumnews.net article on July 10 ... "Linc’s Chinchilla pilot plant is yielding information for the design and construction of a commercial plant with an eventual production capacity of 20,000 barrels per day." [emphasis added] You can get this from Linc's website, here - http://www.lincenergy.com.au/pdf/coverage-128.pdf
2. Capital Raising.
Would the new investors, who spent $100 million, want to know if the plant works before investing? Questions regarding the pilot plant would no doubt have arisen during "confidential negotiations" surrounding the capital raising. I can't imagine Peter Bond saying "I don't know if the plant works - haven't fired it up yet. But give us the money and i'm sure it'll work out ok".
3. Smart Money.
To take a very large position in a stock, you have to buy when the price is falling, otherwise you end up forcing the price up before you've accumulated your desired stake. Look at the big volumes on June 20 and July 3. On both days the price closed above their lows (demand/volume came in at low prices). The low on July 3rd was perfectly placed to trigger peoples stops.
Conversely, large holdings have to be sold into rising prices, otherwise demand dries up before the smart money can offload its position. Smart money therefore has to anticipate high prices and demand to sell into.
4. Logic.
-With an announcement of this nature, wouldn't you want to KNOW that the plant works? You wouldn't make the announcement on the day you cut the ribbon and risk getting egg on your face if the plant came to a spluttering halt a day later. Wouldn't you want to monitor the process, run all your tests, collect and verify data etc, before making the announcement? This takes time.
As the thread title says, "don't bite my head off". I'm just thinking out loud. Thoughts?
LNC Price at posting:
0.0¢ Sentiment: Hold Disclosure: Held
