The past - math and optimism
I'd have to say that I was the most upbeat poster on STP.
Based on the information that was fed to us by the company, the math made total sense to me.
Even by conservative estimates (a la Eyeinvestor) STP was poised to do well.
Up until May 7th.
Gonna bring to light a tidbit from the last NR. It mentioned that the 3 ICD-fitted wells generated 870 bbl/d for July.
If 2P1 was at a conservative 600, 1P5 at a conservative 150, that leaves 2P5 producing 120??? 2P5 was already producing more than that pre-install! Or is it 2P1 that has plateaued at 550? 500?!? This is deemed a success? What a far cry from the astronomically magical 700-900 figure they gave us in March(2P1). These guys state that the ICDs are improving production. I think not. At least not to a level that will save the company's bacon.
--- To those with fancy subscriptions, if you can post the exact production results for each of the respective wells, it would help to illustrate my point here ---
I, for one, do not believe for a second their assertion that having McKay reach 3,000 bbl/d production will get a player to lend them more money. First off, they need to succeed in reaching 3,000 bbl/d. Second, break even is now around 7,000 bbl/d. I think it's underhanded to tell the investment community that reaching 3,000 at McKay will get them more money. Oil price is dropping, now aroung $94 WTI and no one wants to touch anything oilsand-related. 3,000 bbl/d at McKay translates to 4,500(1,500 from Senlac come December --- OPTIMISTIC) as a whole. This, in turn, translates to cash burn.
There was mention that Credit Suisse would lend them more money. Lemme ask you this: If playing poker and the river card gives you drek, will you go all-in KNOWING that your opponent knows that he has you beat? Ok, that analogy sucks but you get my meaning.
To be optimistic in the notion that STP can go at it alone and surviving in its present form.... well, I dunno what to say.
One of two things will happen in the coming months.
1) It will be recapitalized
2) Bankruptcy
Either of these scenarios spell doom for the common stock. The debs? There might be a play there. Although, admittedly it's fraught with risk and Shatner doesn't like blind risk all too much at this stage of the game. Measured risk, perhaps. Sorry boys, at this stage of the game, I do not see a happy ending.
Shat