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PSA - PETSEC ENERGY LIMITED


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In reply to: stezz on Thursday 26/06/08 12:37pm

Really hard to resist PSA at the prices you mention. Had to pick some up today at that level, really surprised still a few tax loss sellers around. At this price one is buying PSA at exactly 1/4 of the price this time last year. ($3.40) Are things that bad for PSA? I dont think so and appears a no brainer.

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In reply to: albion on Monday 30/06/08 11:45am

They should earn good money in the second half of 2008 due to the current high gas prices and much lower hedging but will be lucky to break-even in the first six months due to hedging & dud wells in China & the US.

There are also no new developments coming on stream in the US so it has a falling production profile & the latest ROC presentation says that the initial oil flows from BG will be only in the range of 10 to 15k rather than the 20 to 25k that has been peddled about previously by some JV partners.

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In reply to: miningnut on Monday 30/06/08 10:57am

mn;

Noticed an announcement today that indicated the former VP-Expl. that left two years ago has just sold 18.6% of his new company for $22.0 million. That would indicate his market cap is larger than PSA already?

 

O

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No shocks in quarterly numbers. IMO any one panic selling PSA down to 72 cents has to be nuts. Current m/c just over $110m even on those reduced earnings you are looking at yearly income in excess of the m/c by $$13.6m. But its the future income that should be of interest to investors and that looks good. PSA sitting at one fifth of its price 2 years ago when oil was a fraction of the price it is now and back to its price of 5 years ago. Hard to make sense of it. Lets hope Terry has a good defence set up or we could see a US company making a grab. Have to say PSA looks an outstanding buy , but have been wrong before.
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In reply to: albion on Wednesday 23/07/08 10:48am

Albion, sure is hard to fathom the market treatment of oilers at the moment. I am 100% energy but things aren't looking all that exciting. I guess money can be made catching the swings from financials to oil etc. if you have the time and inclination (which I don't). I still like the CSG stocks and have the non-trading part of my portfolio in them (VPE,BUL). Although those two aren't traveling all that well at the moment, I expect them to recover well in the next 12 months and both would be takeover targets. Trading wise, I am holding AZA and BBP - both bought at the bottom I hope.

Do you think PSAs main problem is the Reserves number? 35bcf 2P is a little more than a couple of years of production. Maybe that and the fact that BG is still a way off is keeping buyers on the sidelines. I will be tempted to buy a few if it hits the mid sixties again like it did back in March and then wait and take the 10-20% from any uplift. Is that your tactic as well, i.e a short term trade? cheers 2bs

post-16-1216778333.gif

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In reply to: albion on Wednesday 23/07/08 10:48am

Have they actually made a profit or are we concentrating too much on the EBITDAX figures again. After the interest paid on the debt, write-offs on dusters and amortisation is there any profit left?

 

The market cap of 115m + 40m debt gives 155m enterprise value. This values each 1Bcf at say 4.42AUD. Not exactly cheap IMO.

 

No exploration to speak of in the next quarter and hedges that kill any upside from gas prices. What are the chances there will be nothing on China again in the next quarter. Moonshine has been a total debacle so far and if it wasn't for the production purchase last year PSA would be struggling for survival.

 

I did sell out at a loss earlier this year and hence I may be biased but I think there is better value out there IMO.

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In reply to: Twobees on Wednesday 23/07/08 11:58am

Really have to say looks like a lot more than 10/20% possible but in this market who knows. Its not too hard to see towards $1.30. Yes the market is almost saying BG will never happen and no wonder its been going on for years and going nowhere. But its going to happen and that may be the wake up call for PSA/HZN/ROC and just imagine IF CNOC decide they dont want that interest. Well I might be a mug but bought in at .69, the price it was 5 years ago. Just think we might be seeing the last desperate investors getting out of quality oil producers in the last few days. It really hurts to buy oil stocks just now but would have to think buying PSA at 69 cents and ROC at $1.59 the lowest prices in years has to be worth the risk.

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In reply to: chimera on Wednesday 23/07/08 12:14pm

I hear what you say chimera and believe me I often get it wrong.But it does seem to me there is big room for PSA to improve. At .69 the m/c is only about $106m. With their current cash flow, proven reserves and surely China at some point soon they would have to be better value tthan many other oilers around. For example PES with no production and only$4.1cash and m/c of $171m or even MAE with an m/c of $368 and not to much to show for it.Ask me in 6 months time.

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I thought the Boardroom Radio audio was a bit downbeat - working through problems with the various wells and discussion of further delays with BG.

Have to say that Mr F doesn't seem to over-egg the pudding! I'm happy with that.

 

http://www.sharescene.com/html/emoticons/smile.gif

 

 

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In reply to: albion on Wednesday 23/07/08 02:12pm

Anything compared to Marion looks cheap. Must be the most overvalued company in the oil/gas sector.

 

I'm TFs biggest fan, he came back from the brink and for awhile it looked like PSA cannot do anything wrong. But the game has changed, the costs of finding economically viable pockets of gas have skyrocketed. The lower drilling activity next quarter will turn out probably to be a good thing as they may finally book some profit. But unless something happens with China the stock will remain unattractive to me. And TKO? They would need at least 100Bcf to look appealing to a predator. They do have a lot of acreage now, that's true, maybe they can attract a well funded partner to share the drilling costs. But mostly they need more success with the drill bit. Catch-22, I'm getting lost in my own argument so I'll just leave it... http://www.sharescene.com/html/emoticons/smile.gif

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