Hope/Hype vs Reality Pre Kawa spud, Cgx was driven almost entirely on the hype of oil in corentyne and the hopes it would have similar results to nearby wildcat discoveries.
Kawa, upon the release of news it hit oil in late Dec 2021, saw the share price jump nicely and then skyrocket upon news of ~200ft of pay. The hype and hope that so many investors pushed for came true. Truly a banner day for the company!
Unfortunately, this is when reality set in. CGX demonstrated to the market they couldn't drill a well within budget. They proved the couldn't drill a well and obtain the necessary data to make conclusive claims regarding hydrocarbon quality. Market was very unforgiving as too many unknowns existed.
With Wei, other than long term investors who still subscribe to hype, many investors with O&G experience were now looking for meaningful results. The share price remained below $500MM market cap. The presence of oil, though exciting, is meaningless unless it's proven to be commercial. Anyone who thinks otherwise is dilusional.
Hence my pure frustration with yesterdays news release. No idea on net pay, porosity, etc.... yet somehow they know the oil API. Like hell, they know exactly how much pay they have. My guess is it's thin and nothing worth bragging about, and hence they didn't spill the beans. But they needed the fluid quality, since it was needed to prove up Kawa at a minimum. Either way, market is not happy.
End of day, CGX as a company for all purposes comes down to the next 1000ft of drilling in the Santonian. Market has shown they couldn't give a single fu*k about hype anymore. Either CGX delivers the goods and shows massive pay in their next news release or this sucker plummets well below $1. To think otherwise would suggest pure ignorance and solely relying on hope.