LGX Oil + Gas Inc ROAOF

ExOilCo Speculations.

[GreatSwami]

Interesting watching all the basic studies going on here over the last month.

I seldom post here any more and while doing some daily speculating - I basically bailed out of my long position taking my (for me huge) Capital Loss to apply against former Capital Gains.

I held on way too long here under the assumption that the "World Class" producing and to be developed properties would set off a bidding war from which many long suffering shareholders might recover some dignity - and even a little cash! However I underestimated the depth of the financial crunch and more significantly I underestimated the ability of the Alpha predators to co-operate when the conditions are right.

This is the North Sea and many of the Majors do not go it alone on most projects preferring to take percentages of projects and share the risks. Because of this we are probably seeing the Majors that are interested using the exquisite timing and predicament offerred here to collude amongst themselves to pick up prime assets at pennies on the dollar and simply share the spoils. Makes far more sense than going head to head and risking doubling tripling quadrupling the price they pay. Taking half of a property at the lowest price possible is always better than taking the entire property at 3-10 times the price...

Sure this is only my opinion - but to me after nearly 33 years in the oil patch - it makes a whole lot of sense. That is why we are not seeing a bidding war here. Its the perfect storm. Commodity prices are battered - and may not yet have fully bottomed. Many potential targets are in terminal financial difficulties and the big boys are simply carving off the bits and pieces by co-operating amongst themselves rather than battling it out at auction...

The actions we are seeing lately is simply the market manipulators playing the uncertainties for all they are worth and reaping their large rewards off thin spreads and huge volumes.

Sure there is a potential salvege operation underway but the administrators are playing with a very weak hand if there is no competition for the assets - simply a wait and see what the lowest price might be attitude. Sure at the right price even some cash flush Minnows might consider a stink bid - but this is something easily trumped by any Major - if they have to...

No folks this story is mostly over - the outcome while uncertain in its details will not reward its shareholders under almost any imagineable probable outcome. The winners will be the traders who get on the right side of any sudden SP moves - either by pure luck - or else by driving it???

No place for any but the Casino players. I wish it were otherwise - this one has broken my heart and broken my bank. I know the mistakes I made holding here and wish it had unfolded differently - however I have learned my lesson and will recapture my dignity elsewhere over time.

Good luck folks - just never underestimate the power of co-operation when it works against you.

GS