Petro Rio S.A. HRTPF

BK's Video

[plieber]

I assume most of you saw BK's video!  I expect the stock to drift down again after the excitement of the video dies down. On the Bovespa HRT was fluctuating wildly - from 3.92 Reais to 3.48 and back to 3.92 (BTW by my calc 3.92 = $.97 US). Having said all that BK does make a good point.  The upside far outweights the downside.  Yeah you can short here and most likely make money. But would you be willing to be short 50-60 days from now.  I certainly would not.

Here's what I think are the pros and cons.

Cons

The odds of any one well being a success is now estimated to be around 18 to 20%.
HRT is having enough trouble finding oil on dry land.  So how are they going to find it in deep water
They are burning through a lot of cash to finance  this drilling campaign.  If they don't hit the stock will probably go under $.25 a share.
As with the case in Brazil Amazon region HRT could find only gas when they drill.  They are, in fact, right next to the giant Kudu gas field, which has proved to be too far from land to tap.


Pros

HRT has spend tens of millions to assemble the most extensive set of sub-seabed (seismic) imagery of offshore Namibia
From this imagery independent oil consulting firm, DeGolyer & MacNaughton, has issued reports stating that they estimate that HRT's Namibian holdings could contain as much as 28.5 billion barrels of oil
Satellite imagery has shown oil slicks (presumably from seabed oil seeps) above their drilling sites.  BTW, this is how the giant Mexican Cantarell oil field was discovered
There's been plenty of oil discovered in offshore Angola, Namibia's neighbor to the north
Portugal's giant petroleum company, Galp Energia, believes enough in this project to invest heavily
The downside in this stock is maybe 80 cents more as opposed to a multi-dollar jump if they do find oil

[robnhood]

Good post.

[plieber]

Thanks!! I forgot another big negative - There have been 16 other offshore Namibian wells drilled. Eight of them were drilled in the giant Kudu gas field which is right next door to Wingat.  But besides gas at least 8 other wells were busts.   If you want to read about this go to https://www.namcor.com.na/history  

[wallywill]

Wingat is not next to the Kudu Field. Wingat and Murombe is in thw Walvis Basin which is miles from Kudu.  The  prospect on Block 2713 is Mooshead which is the one next to the Kudu Field.                                  

[Oiljars51]

Correct wallywill! KuduField is in the Orange Basin, very different system. Of the 15 -16 wells drilled, 7 wells were onshore and 8 wells were drilled in the Kudu field, Orange Basin.

[Wisee]

Plieber,  Can you please provide the link to BK's video.  I want to see why everyone is so excited about HRT today? Thanks,  Wisee

[xoox]

"Wingat is not next to the Kudu Field" ...not only that, it's not HRT's best prospect, so you gotta give MM credit for proceeding in an orderly fashion even though a Wingat duster would rattle the sp.  

[gusgold]

GALP wanted Wingat drilled first

[plieber]

Whoops!  I just had a major brain fade.  You are correct.  I had just been reading about Chariot Oil's Kabeljou well failure in the Orange Basin, where their block is adjacent to HRT's block and to the Kudu field.  BTW the estimate of potential oil reserves at Orange are more than 3.5 times the estimate at Walvis: