May 30 interview with a O&G Gurudavid_pescod@canaccord.com
AN INTERVIEW WITH ANDY GUSTAJTIS (As of May 30, 2007)
We are with Andy Gustajtis, the D & D Securities financial guru,who probably has the hottest hand in the oil and gas patch in picking stocks over the last year or two. He picked Corridor Resources (CDH) – who would have thought there was gas in New Brunswick way back at under a $1.00, but he was there. Similar picks such as Rally Energy (RAL), Kodiak Oil & Gas (KOG) and many others have fared equally as well. It’s time for an update so we caught the busy Gustajtis late on Wednesday…
Dave: Just in case people think that Andy walks on water or has the cure for cancer, we should bring up Stealth Ventures, which like many gassy stocks, has not had a lot of fun.
Andy: I can only tell you that if you take a look at Stealth and you take a look at my Kodiak and Corridor – the trading patterns in those stocks early in their game were no different. What I like about Stealth David, is that I’m not paying for an exploration story. They have clearly a major, major asset in Nova Scotia with the CBM. Yes, there has not been any ability on their part to show any commercial rates out of the work that they’ve done, but the gas is there. It’s a question of time and experimentation before they get the right combination of completion and drilling and de-watering and I am confident that will come. It’s a trillion cubic feet plus resource with a company that’s got a market cap of $80 million. I am prepared to take a little bit of time and wait until I get my $2 billion worth of valuation in that stock. Why get overly concerned about it?
On the shale play in Alberta and Saskatchewan, there is some very, very positive news beginning to come out. They plan 25 additional wells, they’ve got five wells that they have on production, they are getting commercial rate out of the shale and they’ve assembled over a million acres net to their interest on this shale play.