TSXV:ART.H - Post by User
Comment by
discernon Sep 05, 2010 9:56am
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Post# 17416292
RE: RE: Bad news for VST?
RE: RE: Bad news for VST?When WZR hit condensate and gas the share price plummeted from $1.29 to
.73 in a day. After that initial fall, the sp was fairly stable at that level. Also note that WZR has 220 million shares compared to Vast's 170million.
Of course gas is not nearly as valuable as oil, however, since this press release, other news reports indicate a gas pipeline is being built from the Kurdistan region to Europe. Perhaps, more accurately, Kurdistan will be connected to the gas pipeline that is being constructed to Europe (google Nabucco). Although the time frame for the pipeline is 2017, this will provide a real market for significant gas discoveries in Kurdistan. Hence, gas discoveries become more valuable.
Finally, it should be noted, that WZR stabilized in the
.70 -
.80's because of the gas discovery. The price only went down further after their major drilling problems.
At this moment the market has very little confidence in discovering Kurdistan oil. Most of the operations are finding drilling difficult and very few are proving significant results.
I share this to conclude that even though the price of Vast would go down if they only discover gas, their current sp may have already factored in quite a lot of bad news.
In fact, we have more evidence to know how the sp will do with bad news in this market than what will happen on the basis of a major oil discovery.