The skinny hereThis deal has both positives and negatives, and investors should be aware of the perils and potential rewards..
Firstoff, this is a concept play, with the objective of being a high impact growth player in Columbia. The inventory and diversity of projects is impressive, with several having elephant potential. Equally impressive is the management team, first class from what I gather. Another big plus is that there is some development plays mixed with the array of high risk, high impact exploration plays, so some of the rist is mitigated.
From what I have heard, the project with the largest share price impact should be the Guachiria project, where the company recently announced the aquisition of the Guachiria south block. This area has already been drilled, so there is a little less risk in the program and some of the exploration will be conceptaully developmental as the targets are well known. This and a few of the other projects are high impact, and multiple successes could propel the share price into the double digits.
The risks are that Columbia has always been difficult and complex from an energy exploration prospective, (not to mention th political risk) - we have already had 2 dusters, and both were high impact wells that were highly prospective. One more duster, especially if it's Puma, and the short lived share price rally would be over. However, being the optimist I am, and guageing from the recent market activity, it looks as though we might be successful on Puma. "they" would certainly have an idea being near total depth, and a recent issue of cheap options would normally imply success.
I have recently taken some money off the table, selling into the strong rally, and hedgeing against the possibility of a Puma duster - I was fortunate to have gotten in at the bottom, loading up at $1.01 and $1.15, then buying a trading position at $1.60. If they hit on Puma, I might buy some more. But we must keep in mind that this company has a lot to proove, and most of the recent rally has been speculative.... Those in this deal for the long run will do well as sooner or later these boys will hit on one of thier high impact targets. But there might still be a masty roll coaster ride in the mean time.
One last interesting tidbit wrt this deal lately has been the relevant absence of cannacord wrt to the buy or the sell side. They have all the paper as they financed this deal, but they are sitting on the sidelines or suspicioulsy silent. Look out if you see them jamming out paper, but thier asence of strong selling into the recent rally is quite bullish..
Good luck to all longs, and don't be afraid to take a little off the table after a strong rally..
JANDD