Once there was a stock..............that many, many Big Players wanted to buy out.
It was an oil company in Khazakstan. I think it's name was PetroKhazakstan, it's been a long time ago. The stock symbol was PKZ if I recall.
They had an absolutely huge field they were developing on the shores of the Caspian SEA. The field extended well into the sea, and had huge claims that they were drilling, drilling, drilling on dry land. Reserves were obvious they would be huge.
Shareholders KNEW a buyout was immanent.
Who wanted to buy it?
The Chinese state sponsored oil company. A big Indian Company. An Italian oil company.......others?...a few more I think, but I forget. But, there was ruthless competition to get this gem.
I don't remember the dynamics on the Yahoo message board, but the stock was hugely manipulated. The main tactic for the Chinese was to gain access to the Kazakhstan political elites, and create some type of legal consternation regarding the company.
Shareholders has been speculating about the buyout price. $80 plus seemed reasonable. The share price had risen to $40 and beyond.
Then the political pressure was put on. The Kazahk government put out some sort of legal clouds over the company. The stock dived to $25.... but not for long, as it started to rebound fast.
The Chinese came in with a buyout at $53, way below what shareholders has assumed was solidly reasonable.
The Chinese had played the most ruthless game, and won through outright political bribery.
I really gambled, and added more on the plummet to $25. I even used options, and a huge bet for me. I could have lost really huge if the buyout wouldn't happen, but, it seemed obvious it would, but I risked huge.
One day I woke up to the buyout offer. At $53, the Chinese were stealing this resource. I won my gamble quite huge. But, the Chinese oil company had played their hand ruthlessly. They held the ace, their political influence with the Khazack ruling elite.
How does this apply to NFG?
Very different circumstances in political respects. Newfoundland isn't remotely like Kazahkstan, subject to ruthless political intrigue.
But, the hardball strategies and tactics can be assumed to be being played here, with NFG in Newfoundland, as it was in corrupt Kazakhstan in Communist China's back yard, where China was not about to let PKZ be bought out by anybody other than China. They were going to get ahold of those massive reserves by any means necessary.
So Snowline (SGD) is a great prospect with easily calculable reserves. They have a lot of gold. It's easy to mine open pit. Their market cap has recently rallied strong, so that SGD now equals NFGs market cap.
NFG has a lot of gold too. Who has more gold, NFG or SGD? Hard to say for sure, but NFGs gold is harder to delineate, but the insiders of NFG clearly believe NFGs resources are huge, and that NFGs Queensway project will be being mined many decades into the future.
Outside observers in the hold sectors are also suitably stunned by the high grade gold ore results NFG has shared up, with the biggest, by far, exploration efforts put on by any exploration company in Canada.
NFGs high grade gold ore is stunning, but the location of NFG and the infrastructure resources surrounding NFGs massive and prospective Queensway project are literally incomparable to those of SGD.
SGD is in the remote wilderness of the Yukon. You reach their site by helicopter. Can you even do development work in the brutal winters of the Yukon?
NFG employees can live in 10,000 population Gander, and drive a short distance to work on the Trans Canadian Highway, in winter. Everyday.
NFGs Queensway project could begin to be mined right now, in some reasonably quick time frame. NFG even has an agreement with Maritime Resources to have NFGs high gradecore processed by Maritime.
Electric power lines cross NFG s Queensway project now. Key power lines follow along the Trans Canadian Highway. Logging roads crisscross everywhere on the Quensway prospect. NFG has even built very comfy lodging infrastructure for its employees on the south end of Queensay, as Queensway is so huge, the commute to south Queensway over logging roads is too inconvenient even for nearby Gander.
ALL the infrastructure to develop SGD will have to be built. It literally is in the wilderness, hundreds of miles from any infrastructure. It will cost hundreds of millions, maybe exceeding a billion dollars to just get the infrastructure to SGDs properties. This will take a number of years.
Should SGD be trading at the same market cap as NFG? It seems quite probable that NFG should be at significantly, likely a very significantly, higher market cap than SGD....let's say roughly double the market cap. Which would put NFGs market cap roughly at the price target of the analysts who follow NFG.
When a resource prize like NFG comes into existence, the games by those who want to gain control over it begin.
The rules of the ruthless games differ by the location. Newfoundland is very different than Kazahkstan. The Chinese state owned oil companies are very different from Barrick or Agnico Eagle. But, the goals are the same. Get this resource as cheaply as possible.
Thus, the shareholders in NFG have come to realize that the price manipulation games to hold the NFG stock price are real and are constantly being played....each day....every day....
Without these manipulations, NFG s price would probably be a few dollars higher. NFGs market cap would likely equal or exceed SGDs.
I do not think NFG should allow itself to be bought out, and they don't have to allow it. Nfg Is closely held by two key owners.
The similarity of NFG to PKZ is that both are highly desired resources. Manipulation games will be played by those who want to gain control over these resources. But, in NFGs case?n time is on NFGs side. The resources of Queensway will be revealed and proven up relentlessly. And, NFG can't be forced to sell out, unlike PKZs situation.