for years ELK have said they have held discussions with...

for years ELK have said they have held discussions with potential JV partners......JVs where are they???...

Oil prices have recovered strongly and at $70 are in the 6 strongest years on an inflation adjusted basis comparative to the last 60 years, ....The markets are factoring in an end to the Global financial crises, money is flowing much more freely and deals are being done....

Any one else feeling a sense of Dejavu???......ELK has still not managed to do any JVs or made any progress on any short term cash flow positive projects.....and the money is running out......ELK burnt through $600k last quarter, and based on the drilling of the core well which had cost blowouts due to the extended time it took to drill,I would expect ELK are going to be looking for more cash early next quarter.....Will the FID be in October as reported by ELK in the last quarterly??? based on the fact that not 1 date has ever been met I suspect not....so if we have no FID and are running out of cash at what price do they destroy shareholders equity at???

In the long term I expect energy prices to rise as a lack of investment combined with the fact the easy oil has already been found to lead to a global shortfall in supply....however in the short term the price of oil is vulnerable to an oversupply combined with a shortage of storage and the shoulder season approaching....and potentially another wave of the global financial crises....Ctindale who many of you will remember from the ELK thread has a very good understanding of the potential problems that may lay ahead for the global economy...Have our directors factored any of this into their decision making????

Over the last 2.5 years, which included the biggest oil boom in history ELK burnt through approx $17.3 mil (up to june 30th 2009)....made up of approx $11.5mil revenue and $5.8mil cash on hand......Within 6months of the oil boom ending ELK was on its knees begging for cash having nothing to show from the good years....Assets that (to quote Andy)"nobody was willing to invest in at anyprice"
making them worth $0.....ELK obviously had no concept of the conditions within their industry or the attractiveness of their assets to outside players as even after the worst had passed they were still convinced that they could JV the gas assets at Nape for significant money to carry them through...and unfortunately the plan B was a bad one!!!

So although the long term for oil looks strong shareholders can ill afford another 6 month collapse in the oil prices, as we witnessed last time when 80% of shareholders saw 1/3rd of their capital wiped out.....

Based on the uncertain direction for oil over the short term I beleive it is vital that ELK secure their future by developing low risk revenue projects and/or securing joint venture partners for 1 or more of their projects.... time is running out before the same 80% of shareholders that got their shareholdings destroyed last capital raising are again punished for investing in this company!!!!