I've gone in with DLS early this morning. Oil and Gas...

I've gone in with DLS early this morning. Oil and Gas exploration and production, Aus -> Cooper Basin.

Recently acquired Acer Energy and posted a $45m profit with 1.1mmboe sales, revenue $102.2m. Healthy profit margin. $50m undrawn line of credit with a $120mish convertible note at 6%.

Expected 2014 production 2.2-2.5mmboe, cash flow seems solid and all debts serviceable. Several joint ventures underway.

The short term stuff is drilling results in December that will provide further guidance on their as yet untapped unconventional oil/gas approach. This is what they hope to make their big bucks in the long run.


Now I'm a bit of newbie to this sort of analysis. I don't expect big bang for my buck with DLS, but I consider the risk worth the potential modest gains in 1-3 months. Is my approach sound?