Compass Venture Inc T.CVI.A

Hugely over valued.

[CalifDreaming]

PV10 after tax valuation of only $129MM ($1.30/sh).  Tiny reserves.  4.2MM bbls P1.  3.2MM probable and only 2.9MM bbsl possible, so very little upside from existing fields.

You can buy plays all over the place trading at huge discounts to PV10 (up to 50%).  Yet people are willing to pay 2.5x PV10 for this play?  In Yemen?  With these guy's history of over promise, under performance?  Criky.

Say, what ever happened to the 30,000 bpd they were "supposed" to see end of '07 (or was it '06?).  Now, they can barely make 5000.  And I notice the CPF STILL ISN'T FINISHED.  It was "supposed" to be finished by end of '06.  When is the pipeline gonna get done?  Next decade?  And where's the oil to fill the pipe anyway?  I see they are now having to use NG and water injection to keep production up.  How on earth do they plan to pull 30,000 bpd out of Hiswah if the field can't support 5,000 bpd?

And look at cash flow - $0.10/qtr a share in the midst of all time oil prices.  $0.40 annualized.  Slap a 3-4x multiple and you get $1.20-$1.50 target price.

I don't get it.  CVI deserves about $1.50/share valuation on cash flow and reserve valuations, plus cash of about $0.75/sh.  Say $2.50 tops.    Only way to justify current valuations is if they find oil down in the basement...