Still, if there's a boardroom implosion at the publisher,...

Still, if there's a boardroom implosion at the publisher, chairman Roger Corbett can take solace in his sideline interest in the US-centric shale-oil play.

Corbett was part of a cabal of deep-pocketed folk including Max Beck, Bruce Mathieson and Boris Liberman who seized control of Molopo a year ago, on the platform of improving the share price. The stock has since lost a further 40 per cent, but is the promised turnaround nigh?

Molopo on Monday shed its stake in Canadian outfit Legacy Oil and Gas for $67 million and yesterday followed up with a $36m drilling program to get its prospects (mainly Bakken in Canada and Wolfcamp in the US) flowing the black gold at decent rates.


Management targets calendar 2012 output of 680 barrels a day from these prospects.

Although Bakken shale ventures tend to be a case of low risk but for low reserves, three wells on the Wolfcamp promise more exciting yields. Results are expected within four weeks.

On paper, Molopo's $155m market valuation is compelling: EL & C Baillieu analyst Ivor Ries estimates Molopo will sit on cash of $170m post the Legacy sale and after the expected divestment of its Queensland coal-seam gas tenements. Ascribe a $70m worth (on a bad day) for the North American stuff and Molopo is "worth" about $1 a share.

New management has a lot of convincing to do, but a Wolfcamp gusher would help bolster their resources street cred.
Source: The Australian