RE: RE: Blackrock The real tanked big against both the USD and CAD today. Look at the chart of the real vs the USD and plot that against the Bovespa HRT price today. Is it just coincidence the Blackrock reduces it's exposure today against that? I think not. Go back and plot it again for the last 6 months. Expect more of the same from US/CAD funds/banks if the real continues to weaken against the north american currencies. How many of the big funds holding HRT on the brazilian index are North American? (a lot) How many are desperate to dump shares/warrants in order to raise cash to cover up all the sovereign debt bombs on their balance sheets?
Some of the selling this week was probably planned to reduce emerging market risk, and they wanted to sell into news (194 well results). A lot of these guys will come back once the 2009/2010 currency trends return and the EU debt situation is resolved (or US and EU money printing picks up?).
HRT can only continue to execute its exploration campaign in the face of this. As for the 194 well, 1000 bpd of consendates of production is what ~9 million USD a quarter (assuming $100 per barrel of oil) using river barges for transport (assuming the directional well is successful). They wouldn't be drilling in the same spot if they did not think it could not be monetized in the near future. MM talks about 194 in the Q&A in the 3rd quarter call and he mentioned a possible development well this year after the 2nd exploratory well. I agree that expectations were set too high by HRT, and being a new company and having an inexperienced CEO in these matters, hopefully the lessons were learned.
The TNK rumor makes no sense unless the Brazil regulators (ANP) are causing a stir with TNK-HRT agreement approval process. Where does TNK-Brasil go then? Bid for offshore Brazil blocks? Did you see the crazed public reaction to the Chevron accident? Offshore Brazil and foreign oil companies are currently not popular among the public there. TNK is sitting good in the Solimoes with all the risk being on the current operator, HRT. I say BS.