Mart Resources Inc MAUXF

RE: Putting things in perspective

[Lousytiming]

 

What Is Chen Buying? What Is Chen Selling?

Letter #711
January 31, 2012

Update:

Mart Resources Inc. ( MMT.v) released great news from UMU9 this morning. They intercepted a lot more oil zone under the current oil producing zones. This should add a lot to the reserve and future production. It is very interesting that they found gas under the oil. Usually gas is on top of oil. This mean they could have a new structure under the current producing structure.

However, MMT had a shocking break down this morning on the same news. I think some investors were spooked by the pipeline issued in the past two months. Remember the pipeline had issues in late 2010 as well, but after that we had almost non-interrupted pipeline for almost a year. This issue in the past two months appears to be technical. As a Nigeria company, you have to live with it and hopefully the pipeline will recover soon. Remember, last time MMT got paid regardless of the pipeline had problem so it had very little impacts to MMT cashflow in the near term. Next year, when MMT build its own pipeline, I don't see it will be a major issue anymore. MMT still has many great catalysts coming, including potential dividends. I used the opportunity to pick up some cheap shares here.

Another point is that MMT has recently became a momentum stock thanks to rapid price appreciation. I think many momentum day traders are coming to the stock. This is a great wash out to get rid of them. MMT can do much better without them.

Majescor Resources Inc. (MJX.v) also release great drilling results this morning. I see eventually the stock is going to move on the news. There are a lot of high grade copper and gold there. People will take notice eventually.

Regards,

Chen