Opinion and PerspectiveI believe that Wolfgang can promote and profit greatly from owning stock in both Regent and EuroGas. Additionally, he will be able to shift his interest and promotional efforts back and forth depending on the difficulty he experiences in dealing with Regent’s management and the Vancouver exchange, the timing of CBM financing and the resolution of the EuroGas lawsuits and cleansing or EuroGas and himself as an investment opportunity. Regents and McCallan are his only real options for converting the assets that are in McCallan and/or known to him to be available (the Belmont deal) into cash. I am also assuming in my analysis that Wolfgang “may” look out for Ed Muller and will absolutely look out for Hans Dietman and his brother Reinhardt but will not care about the shareholders of either of the public companies. I would assume that he is acting in his own self-interest and see nothing wrong with this approach. We will act in our self-interests and should try and persuade and pressure him to align his interests more closely to ours.
DISCLOSURE
My self-interests and disclosure are that I am heavily invested in Regents and now lightly invested in EuroGas as an insurance policy against not understanding Wolfgang’s view of his universe. I know without a doubt that he is very interested in EuroGas. Our share price is at two year lows and so the issue for me and many other longs is whether we try and sell and cut our losses or hold longer believing that the situation will likely resolve in October with the expiration of Haywood’s warrants and the drilling of the Carpathian oil property in which Regents has an approximate 11% interest and McCallan a 13% interest.
Truthfully, if I could sell my over 1,000,000 shares at even $0.20 US, I would probably be gone for now but the reality is that I can’t---no liquidity. The share price is extremely sensitive to selling right now because few buyers exist. The reason I would sell if I could is because of the “dead Money“ issue and NOT because I think that Regent’s value is suspect.
I believe that the completed Aurelian/Polish Oil and Gas joint venture virtually guarantees some level of value greatly exceeding our current price even without the CBM unless current management self-destructs or the Vancouver exchange gets involved. However, I could find a better performing stocks in which to invest over the next two months given Regent’s current situation and the usual run up in the natural resource stocks that occurs in September. But by the time the liquidity recovers so that I could sell, we will be close to the time when Regent’s share price should recover and I will not want to sell because of the huge potential of hitting a large oil resource.
The only thing that would change my opinion of Regent’s two-month performance would be if McCallan and Wolfgang were able to negotiate CBM financing. Then, I am a buyer now at these prices. In September, I also might be a buyer depending on price and what I hear about the seizmics.
REGENT VENTURES COMMENTS
With regards to Regent Ventures, Hans/Wolfgang should still have the 3 million shares he received from escrow and probably has not dumped them yet because of Regent’s lack of liquidity. Granted, this total is not that much but if he agrees to give Regents another 4%-6% interest in McCallan, he will get another 8-11 million shares. He will also get 1 million shares for each producing well up to 25 million shares and that presupposes that he will get financing and drill the CBM and Regent should have a 22% interest in the profits from that effort. Ed Muller also probably still has 2.5-3 million shares. Regent’s share price will increase greatly with any announcement of CBM financing and liquidity will also improve. No real cost exists to McCallan and Wolfgang to take ALL of the above actions. If Regent’s share price went to only $1.00, the value of his holdings could be more than $35 million and much more with CBM financing and drilling. Regent’s management should be trying to facilitate increasing our percentage interest in McCallan if for no other reason than to give Hans/Wolfgang more shares in Regent and therefore activate and increase their degree of self-interest.
Rick Wilson’s delusions about non-exclusive deals in Tar Sands technology for unnamed properties will not move our share price. I am also worried that he believes his own delusions of grandeur, thinks that his deals in progress are worth more to Regents than the CBM deal and may be resisting giving up more Regent’s shares to McCallan in return for an increase of another 4% in McCallan. We should be all over this issue with Regents management. Worse yet, he might try to cozy up to Haywood again to get funding for some of these squirrel-brained schemes by giving them more cheap shares. No more cheap financing and no more Haywood.
EUROGAS
Wolfgang is the CEO and owns probably 100 million shares (51%) and his brother owns another 25 million, with a third party owning yet another 25 million. With 191 million shares outstanding, the float is about 41 million shares and is probably owned by creditors. With a smaller float than would be expected and few investors, the selling of EuroGas can be controlled and that is why the asking price is rarely lowered and the share price is escalating even on small volumes.
EuroGas came out of bankruptcy in February of 2007 (see the last 10-Q) so the issue of debts should have been resolved in the bankruptcy but this fact is hard to verify because of the poor organization of the last 10-Q. I believe the EuroGas is close to debt free. However, Wolfgang, his brother and EuroGas are the object of lawsuits that were not resolved by the bankruptcy and EuroGas currently has no assets. Even if he promotes EuroGas and can control the share price, he will have difficulty in creating any liquidity without assets. If you buy EuroGas, you are betting that he can resolve the lawsuit, prior history and the asset problems. Wolfgang is always going to favor EuroGas he owns 51% and EuroGas is NOT on the Canadian exchange but he is in a position to profit from promoting Regents as well as EuroGas. Additionally, the settlement of the lawsuits may drag out for another 6-8 months.
I do think that EuroGas’s will become at part of the Regent/McCallan mix eventually but not until the image is cleaned up and the probabilities for future liabilities are reduced. The Polish government was angry with EuroGas for the delay and bankruptcy and does not trust EuroGas’s management I hear from European sources so re-introducing them back into the Polish deals in any significant role may be difficult.
THE GAME
I certainly don’t have the answer to what is going to happen and probably would not have published this summary except that sharing my observations is in my self-interest. I already have my positions. All of us retail investors are in the same boat and need to monitor what is occurring and pressure Regent’s management to get “real” and pursue the opportunity on the table or Wolfgang and Hans’ interest in Regent as a vehicle to realize the value of all the McCallan assets will fade. I think that we should pay attention to the following:
1. Regent exercising the option to increase our interest in McCallan to 49% and issue another 8 million shares to McCallan/Hans/Wolfgang.
2. Regents seeking to do a private placement with Haywood or any other party that dilutes our shares. I do not want to give up one single Regent’s share to fund a Rick Wilson get rich quick scheme. Remember, Regent does not have to provide any cash, shares or funding in excess of what has already been stated in the agreements with McCallan to be a part of the CBM deal. We do not have to raise money and have $3 million in the back from the other private placements and warrants.
3. The status of EuroGas in the courts and watching their share price. Sharp increases in share price in August may mean the litigation issues are resolved. The insiders will know the real degree of risk associated with EuroGas long before we get thinks figured out.
The number of Regent’s shares owned by McCallan, Hans, and Wolfgang is the canary in the coalmine and CBM financing is the forward indicator of great success. Just my opinions and do your own DD.