TSXV:PEC.H - Post by User
Post by
Elwapoon Sep 04, 2012 7:13pm
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Post# 20317007
Pumpers, read this before PUMPING!!!!
Pumpers, read this before PUMPING!!!!Especially the last paragraph!!!
Just keep in mind that this is not a fool-proof process. It is estimated that 3D seismic improves your drilling odds to approx. 30%. This still leaves a large margin of error (don't forget the target is 9000 feet deep). They can also hit drilling problems enroute so a lot can go wrong.
If they miss on this well the company has a lot in the pipeline and I suspect we would still be sitting on paper worth at least a dime. If all goes well however, then the upside is dramatic. Institutional money will typically not touch a company at this stage of its life but could buy in huge volume should they hit.
Just don't forget that Porto has invested millions in 3D seismic this past year and consulted with many experts prior to drilling this well. However, we are dealing with Mother Nature and sometimes she doesn't want to cooperate.
. Seismic Value
Porto has about $5 million in the bank. With 200 million shares out, the market cap is $14 million. This means their underlying assets are only worth $9 million at seven cents.
You will see in Part II below where the potential could be dramatically higher (IF) they hit on drilling in Q4 or 2013. These big overseas oil plays are very high risk but very lucrative when companies hit. Africa Oil (V.AOI) watched its market cap go from $170 million in Nov/11 to $2.4 billion by May/12.
Porto has no oil or gas production but 1.9 million acres (100% working interest) of exploration potential, joint ventures and 3D seismic. Should they ever hit an economic well when they control this much land and seismic, the valuation would rise remarkably – even with 200 million shares outstanding.