AUT - Aurora Oil and Gas

[condog]

Courtesy of MIR

Hartleys puts $1.23 target on AUT

AURORA OIL AND GAS LTD
Site Visit Confirms Quality Price Target Increased
We recently visited the projects of Aurora Oil and Gas Limited (Aurora, AUT, Company), located onshore Gulf Coast Texas. The field trip confirmed and increased our confidence in both the quality of the assets and the operator, Hilcorp. Hilcorp farmed in to AUTs acreage last year in exchange for completion of a work program over 10 wells. Aurora agreed to allow Hilcorp to recoup the costs of these wells from first revenue as part of the agreement.
We have adjusted our assumptions around productivity, timing of development and cost and have reduced our risk discount to result in an increased valuation and price target, from 102cps to 123cps.

Our current valuation assumes initial flow rates of 4 million cubic feet of gas per day with 800 barrels of condensate per day (actual average to date is 4.5 million cubic feet of gas per day with 1,073 barrels of condensate see Fig. 1). This gives a risked valuation of 164cps (risk is slowly being wound out as more wells are drilled). If we were to use the averages from the Morgan, Rancho Grande and Turnbull 1 of 3.3 million cubic feet of gas per day with 1,370 barrels of condensate our valuation would increase to 264cps.
Recent well performance suggests our assumptions are conservative and may result in improved economics and increased valuations in the future.

In my opinion $2.64 is too de risked at present, but i certainly think thats the direction we will head if we proceed accident and failure free, or if the market recovers somewhat.

 

[mir]

i posted this on HC

this time I'll only post a bit of the report or it might get moderated again ,if anyone wants a copy i can email it(proga i wouldn't want you to miss this one, very good & very detailed lol).hartley put $2.64 on AUT based on results only from morgan, rancho & turnbull as these were the latest wells.


AURORA OIL AND GAS LTD
Site Visit Confirms Quality Price Target Increased
We recently visited the projects of Aurora Oil and Gas Limited (Aurora, AUT, Company), located onshore Gulf Coast Texas. The field trip confirmed and increased our confidence in both the quality of the assets and the operator, Hilcorp. Hilcorp farmed in to AUTs acreage last year in exchange for completion of a work program over 10 wells. Aurora agreed to allow Hilcorp to recoup the costs of these wells from first revenue as part of the agreement.
We have adjusted our assumptions around productivity, timing of development and cost and have reduced our risk discount to result in an increased valuation and price target, from 102cps to 123cps.

Our current valuation assumes initial flow rates of 4 million cubic feet of gas per day with 800 barrels of condensate per day (actual average to date is 4.5 million cubic feet of gas per day with 1,073 barrels of condensate see Fig. 1). This gives a risked valuation of 164cps (risk is slowly being wound out as more wells are drilled). If we were to use the averages from the Morgan, Rancho Grande and Turnbull 1 of 3.3 million cubic feet of gas per day with 1,370 barrels of condensate our valuation would increase to 264cps.
Recent well performance suggests our assumptions are conservative and may result in improved economics and increased valuations in the future.
Increasing condensate ratio

 

[condog]

2, possibly three broker upgrades, slightly improved market sentiment in the Us, AU economy strong, energy prices recovered 5.8%, buyer numbers way up and sellers way down relative to numbers for the past few weeks.

Looks like a great start to the week. Well better then the doom and gloom of late anyway.

 

[Sean K]

Neptune was in line with pluto, and 4 degrees out of line with saturn which would have made it 2.33, but then i saw that venus was lined up with the moon, which definitely made it 2.34 rather then 2.33

Same way i came up with 1.29 and Euroz come up with 1.32

Apply well flows and anticipated well flows to the drilling programs and projected drilling programs. This gives revenues, deduct taxes and royalties, apply a risk deduction and add some value 10% in my case for wells in the near future. Apply a discounted PE of say 10 compared to the sector and you come up with a valuation. I try to be conservative and be surprised to the upside, rather then get shocks.

Clearly though this is only a guide, but its a calculated guide, rather then a guess.

I find this method allows me to compare it to other companies from differnet sectors, which is very important to my strategies.

If you go back to around page 17 of this thread you will see some of my spreadsheets where you can see my methodology.

Please note, do your own research, always seek expert advice and never act on information from forum posts, from anyone.

OK

Given the calamity hitting markets this week ive re-done my calculations.

Based on the 30 day flows provided for Weston and Kennedy. Morgan ive estimated 1200bc/d + 1.2MMgas, Rancho T1 T2 T3 and Ip at 750 bc/d & 2mmcfg/d. Kowalick unfixed, or fixed at 600bc and 3.3MM.

Ive given declines of 30% in year 1 and to 50% in year 2.
Ive estimated new well costs at $6M and allowed an average of 20% of each well cost.

Ive calculated new mcap on a PE of 8 for end of year net earnings.
using $65 for condensate and $4per 1000cfGas.

Gives me end of 2010 valuation of 88c without Kowalick fixed or 95c with Kowalick fixed. Note does not take into account delay for revenue after paying hilcorp. But also allows no future value applied. Just an unrisked
multiple of earnings model.

End of next Fyr = $2.62 with Kowalick fixed, 30% decline in 2010 wells and estimates of 600boc and 1mmcfg for 15 wells at $6M and paying 20% of well costs. PE of 8

End of 2011/2012 fyr = $5.66 with 25 new wells in 2012, 50% decline of 2010 wells, 30% decline of 2011 wells. 2012 wells at 600bc and 1mmcfg at $6M each paying 20% of cost. PE of 8.

By that stage AUt would have 50 of its 80-130 wells.

Please note this is amatuer calcs, may contain erros or misjudgments. Do not base decisions on them. Seek expert advice. But i welcome feedback etc. Of course some are going to say thats to high, this is too low, you cant use PE etc etc. Its just one model and its the simplest to explain in here.

For those that want to take it a step further you could give future wells a value and risk factor. Ie i could assume 1 in 10 wells will fail completely, and give each future well 3% of its value, 5% 2 years out and 10% the year before etc. But it gets messy to explain. Using thise types of calcs the figures come out much higher becasue theres more then 10 wells the following years. So the simplest way is to just bump up the PE to 10 or 12 to allow for growth.

So with PE of 10 i get 1.09 at end of current Fy, 1.18 with Kowalick fixed
3.28 at end of next FY, and 7.07 the following. This has no allowance for failures other then conservative PE

PE of 12 1.31, 1.42 with Kowalick, 3.93, 8.49

Average PE's run at around 14-18 for this sector with many bigger companies up around 21+
As i said some will say you cant use PE. But you can if you estimate earnings, there just an error factor you need to know exists.

imo its realistic to expect higher Pe's due to growth, but dont get carried away there is still risk. Many US peers operate into the 30's but under a lower tax regime.

As i said may contain errors. So cross check DYOR and seek advice. Do not rely on these, but i hope they help.

OK, I'll tuck that away.

Sounds like the stock is on the way to 8.49 plus, best case. Nice.

Cheers.

 

[rockhound308]

Interesting..
Patino Unit plots in Impanema so that must make May unit a Sugarloaf well or we will have 2 new Impanema wells? Any thoughts agent?
The second rig cant be too far away.

 

[nulla nulla]

This looks like it needs to break through resistance levels arround $0.88 if it is ever going to go over $2.00. At the moment it looks more likely to trade in a sideways channel with possible support levels of $0.75 and $0.76.
If it falls below these support levels it is hard to see where it may bounce from. $0.40?

 

[condog]

This looks like it needs to break through resistance levels arround $0.88 if it is ever going to go over $2.00. At the moment it looks more likely to trade in a sideways channel with possible support levels of $0.75 and $0.76.
If it falls below these support levels it is hard to see where it may bounce from. $0.40?

Nulla first time ive seen you in here. Fortunately theres a hell of a lot more to this stock then your graph indicates. Such as the established TO value of ADI recently at 40c with 1/4 the acerage. The $36M cash in the bank and accelerated drilling program, the staggeringly good and best of the Eagleford published results of Morgan well. etc etc the list goes on.

With a massively over subscribed CR in past weeks at 75c theres a massive resistance point at 75c or above so it would seem given the market and erergy prices of recent weeks, with AUT pullback being significantly less then other stocks and staying above its CR point of 75c.

Theres also a very clear trading band on that graph and a breakout not shown. Infact it has to climb significantly to retest.

Redbeard - a fellow technical - shows a different point of view.
http://s674.photobucket.com/albums/vv103/totterdell91/AUT_2010-07-10103726.png

Any way we can argue about charts till the cows come home, some dont even believe the work. Fact is so far AUT has been a purely fundamental news driven stock, and in the short term will remain so.

From a technical point i think at present the thing worth noting is it has just broken out of its downward consolidation and looks set to test a new high??
From a fundamental view we are expecting Kowalick and Turnbulls very soon , and the entire Eagleford is littered with massive merger and acquisition activity.

 

[condog]

Agent wheres your usually reliable photos and info on
May unit and Patinio unit the two new wells announced on TRRC on 2 and 9th July. For sure they are building a pad at least on may unit by now.


See last post on page 30 of this thread.

 

[condog]

Also try this for style

http://boss.blogs.nytimes.com/2010/07/06/hilcorp-energy-shares-the-wealth/?src=busln

No wonder Hilcrop get the job done so well, pardon the pun.

 

[Agentm]

Howdy Agentm.

Aside from the slight decline in futures prices this week given the huge demand for airconditioning on the east coast earlier in the week overall the August futures price is trading at at 35% premium to the 2009 price.

Not bad year on year? Especially given the US has been on struggle street all year.

That's indicator number one.

Number two is the decline in storage injections year on year " Working gas inventories are currently 23 Bcf below year-ago levels "

Or roughly 2Bcf a month is coming out of inventory.

So the equation is strong supply and equally strong demand. Good news for the industry overall imo.

And if I were to say build a nice shiny low carbon emission gas fired turbine power plant in the US a healthy gas reserve would be a commercial necessity in my forward cost projections.

Lastly looking forward to the next twelve months the price looks to be fairly strong
"Although the September contract decreased by $0.06 per MMBtu during the report week, slightly more than the near-month contract, declines in futures prices were generally limited further into the forward curve. The 12-month strip, which is the average price of natural gas futures contracts over the next year, ended trading yesterday at $5.06 per MMBtu, a decrease of only $0.01 per MMBtu on the week."

lol kennas, somehow i think its slipping by the keeper here..

nulla i am thinking about the .40 bounce also, will it happen?

thanks for the reply slipperz..

i almost swear there is a poster here (very exuberant) almost trying to talk for you..lol

i would like to look at some real possibilities here with you if i could..

i read the report closely and saw some trends, the oil seemed to just rise with a very large rise on the S&P which was on remarkable volumes.. like literally trading on vapour!!! but today the profit takers took hold and sold it down again.. but trends in the US are anything but brilliant, i wonder how many 3pm pumps there will be in the future?

anyway, i am watching oils path closely, and it impact on the sp is the primary factor on whether i invest in the sector again.

looking at eka, its going yet again for capital, very predictably.. and it seems the aut spruikers whom earlier talked up the ability of the small caps to keep up with the massive capital requirements with only a few million in the bank, and laughed at any comments on capital requirements made by me, now are suddenly not laughing nor criticising me any more, so pointing out how completely wrong they were on the ability of these small caps to survive in the acreages they have obligated to seems to have come and gone, and suddenly aut is this amazing share thats going to go to some massive $2 or $8 share. what on earth is going on here?

what else are they wrong on??

upside is there, but i know what the leasing costs are now, and i know what a sudden fall in oil prices does to the operations.. it just shuts it down.. massive downside risks are very much needed to be calculated by the recent sophisticated investors.. fair value for what you have now, not later is where reality is ...

whats strange with the gas prices in the US slipperz.. is the massive expansions into the shales are producing so much gas, that imports are reducing, and gas prices look to be suppressed for a long long time.. and oil imho can not be looking at a run up unless something happens globally to drive it.. i see NIL there driving the US economy up. all indicators i look at are bleak..

for me, i see oil pipeline companies not really driving hard into the region for a long time, so where is all the gas going to go?

pipelines are at capacity in the region.. and you cant just flare the gas off

my view on gas is that its looking at a downward leg.. long term, and gas is at capacity in the region..

my oil outlook is undecided..

what do you see on the oil going slipperz yourself?

 

[condog]

Agent i will say little for fear of offending you. But basically thats absolute dribble.

Right now enterprise is building a 24" pipeline as well as the pipelines running right past much of our acerage. Our high condensate ratio makes us one of the most attractive in the entire Eagleford.

40c what an absolute load of !@$%!@#$!@ .

You where in ADI and believed in itt for 4 years despite your investment being premature to the technology arriving. You then got into AUT, told everyone ot was ana absolute no brainer, got out and suddenly despite multiple new wells, a very successful CR, and the two highest flowing wells with tow of the highest condensate ratios in the entire Eagleford and suddenly you expect us to expect to believe the outlook has changed to negative.

The technology has finally arrived and AUT with the help of hilcorp are applying it and adding value at every turn.

Enough said.

 

[Sdajii]

You've certainly flipped very quickly from oil oil oil go go go to being an oil bear. Is it just coincidence that happened at the same time AWE stole ADI?

 

[mir]

i also like this bit in the Hartleys report imo could significantly re-rate AUT.

Maiden Reserve Report July 2010
Netherland, Sewell and Associates Inc (NSAI) undertook an independent resource estimate over Auroras acreage in September 2009, as depicted in the figure below. At this time, no multi stage fracture stimulated horizontal wells had been drilled and a conservative recovery factor for the Eagle Ford Shale of 7% (Best Estimate) was used. Given well performance on the acreage and recovery factors achieved in other shale plays it is possible that an ultimate recovery factor of 22% may be more appropriate. Our time with the Texas Crude geologist also highlighted large potential upside in the development of the shale, as it may be possible to produce from multiple horizons over the interval and also decrease well spacing significantly. This all depends on assumptions around whether the current fracture stimulations are resulting in drainage of a small percentage over a large area, or a large percentage over a small area.
Whilst it is hard to predict what assumptions NSAI will use for the maiden reserve report, we believe that there is potential for an upside surprise for the market. A significant portion of the field has been proven by wells (see Fig. 2), which should contribute towards a decent 2P number, although we expect that most reserves will be categorised as 3P until more wells are drilled and there is more production history.

 

[Agentm]

You've certainly flipped very quickly from oil oil oil go go go to being an oil bear. Is it just coincidence that happened at the same time AWE stole ADI?

sdajii, i was discussing oil prices with slipperz.. whats with the accusation i have flipped??? what am i flipping on? i am discussing aut and its potential with slippez in respect to what i think is a primary valuation. the price of oil..



btw i had massive capital tied up in adi for a long long time, during the gfc, and hoping adi did not go into liquidation, and believe me, i have never talked up oil like you claim

not sure how awe stole adi?

and i have never been a oil oil oil go go go bull sdajii.. i ask you to please explain where that came from??? oil went from $30 to $80 and saved adi from liquidation.. not a bull at all, just a realist on the prices that occurred..

but sdajii. i ask you a question here.. as you claim adi was a steal at .42.. why is aut not $1.10??? why aut give away its shares at .75 in the cap raising, and not $1.10?? why are you not writing letters to the management on how badly they got their valuations here??? surely you cant allow a steal at .42 be allowed to become absolute highway robbery at .75 for the aut shareholders.. isnt dilution like that an issue to you?

i gather your an investor in aut, so please explain how a act of theft at .42 for awe, is not downright highway robbery at .75 which is about 50% the adi/aut 2.5 ratio??

TIA

 

[condog]

Agent thats utter garbage, IMO.

I understand your concerns around a potential GFC2 we all have it in the back of our mind. But in focusing on AUt and the eagleford, wow. I certainly dont agree with you and in fact i think your incredibly wrong and your sentiment has changed remarkebly, in fact unbeleivably, un palletably.



MIR

I just read that Hartleys report ta dude for bringin it to my attention

What a read, anyone reading that must be dribbling from a corner of thier mouth like i am. Its one thing to be told by AUt through announcments, but its encouraging when brokers are singing praise like Hartleys are on this baby.

Points of interest imo

July reserves upgrade
AUT reserves estimate was based on 7% recovery, Hartleys now thinks 22% is more realistic.
$1.23 target with $1.64 when longhorn averages are applied
Possible forward
work as hilcorp and KKR want action - 10-13 wells in 2010 with majority in AMI and 2-3 in Ipenema
AUT involved in approx 37 wells predominently in Longhorn in 2011
Hartleys impressed with the quality of hilcorp equipment and work, much higher then peers
Best initial and 30 day flows in the entire eagleford for Longhorn
Longhorn makes up 65% of AUT's acerage
Changes in technology, fluids, techniques and stage numbers with lenghts likely to be around 5000ft should produce higher averages
Morgan earned 4.4M in 2 months

Half of Longhorn is likely to need 320 acre drilling as its classified as oil
Possible debt facility in H2 2011 to fund Longhorn 320 acre drilling.

 

[Agentm]

Agent i will say little for fear of offending you. But basically thats absolute dribble.

Right now enterprise is building a 24" pipeline as well as the pipelines running right past much of our acerage. Our high condensate ratio makes us one of the most attractive in the entire Eagleford.

40c what an absolute load of !@$%!@#$!@ .

You where in ADI and believed in itt for 4 years despite your investment being premature to the technology arriving. You then got into AUT, told everyone ot was ana absolute no brainer, got out and suddenly despite multiple new wells, a very successful CR, and the two highest flowing wells with tow of the highest condensate ratios in the entire Eagleford and suddenly you expect us to expect to believe the outlook has changed to negative.

The technology has finally arrived and AUT with the help of hilcorp are applying it and adding value at every turn.

Enough said.

condog. just about everything you say to me is offensive..

the .40 is something nulla stated. i guess cash value is always a concern on small caps..

when nulla mentioned .40 you took no offence to it, when i commented to nulla on it you appeared to think you can have free licence to be abusive..

i invested in adi, not the technology.. i have to correct you many times here.. shale technology was not developed with adi nor the jvp.. they discovered nothing, shale technology came from other plays. and is nothing new... your very much mistaken there.. in fact, aspects of how hilcorp are dealing with the shale play are very concerning to me atm.. but i am not going to discuss that on the forums in case i invest.. its something i am keeping a close watch on.. but its sure as heck not being discussed by anyone atm thats for sure..

re my investment in the adi share and its holding in the eagleford play, is not something i believed in, its something i researched and was imho feasible, subject to three factors being correct, cashflow, lease pricing and oil prices.. i always had the conclusion the AMI acreages were the premium acreages. i did not sell off in the gfc. i looked at the possibility of oil prices coming back, and the possibility of the adi directors surviving any liquidation, and invested further funds in the play when opportunity arose. sure i made a few bucks, but i have much more profit, and way quicker, before being trapped in the adi limbo for 12 months or more with the gfc..

my adi investment and an later buy into aut was an absolute no brainer.. i totally agree, enjoyed every cent of profit the share delivered from .40's to the .80's

sold out and sat out the cap raising, which was discussed and totally not believed by yourself, you became super animated and hostile on any mention of a cap raising.. which imho demonstrated how short sighted you are on this play.

now they were a complete steal at .75 if you think the AWE .40 price was not fair.. you have to agree the management of aut gave them away for zip.. but you dont object at all?? either are the sophisticated investors obviously!!

i have been looking at eka, which needed to raise capital, and aut also in the recent weeks, but have yet to be driven in any way to invest..

i have never said any outlook in aut is negative, please point out what post on aut has been pointing out anything negative on it.

imho aut has upside, but i am discussing the oil price with slipperz atm..

just take a chill pill and allow a forum to discuss things.. slipperz imho demonstrates some ability to diagnose and discuss issues, i am just discussing oil/gas prices with him if its ok with all here..

cheers

 

[Slipperz]

Howdy again Agentm,

I'm a bit more bullish on oil than gas at this stage.

As you mentioned there is a potential for a gas supply glut in the US with increasing shale production...but there is also a trend towards cleaner energy aka gas fired power stations and gas powered vehicle fleets.

That is where the excess production will go imho and the Obama administration seems keen to head down that road as well.

LNG exporters are sending their ships to energy hungry North Asia for a 7.50 spot price for gas rather than North America creating further demand for cheaper domestic supplies

As for oil.. sheesh such a volatile commoditity.

Overall I'm quite bullish on car sales growth in places like China, India and Brazil to propel the price upwards as western consumers buy more fuel efficient vehicles and hybrids which will balance fuel efficiency against growth.

Other factors are many and varied... environmental..will offshore exploration decrease driving up the price?

Socio and macroeconomnic...overall the reports I'm reading are for reasonable growth globally. Bullish?

The joker in the pack is the geopolitical. Instability in the Niger delta, the vipers nest of pirates and reprobates on the Horn of Africa and the Iranians across the gulf. And the central asian fields aren't exactly a model of stability either.

Downwards pressures?

The Iraqi fields are hugely underdeveloped and plenty of unexplored lands there as well.

And Chavez and the Saudis might get together and turn on the tap a bit at
Opec.

Double dip recession in the US?

Put it all together and I come out on favour of the oil price steady and rising into 2011.

 

[condog]

condog. just about everything you say to me is offensive..

Wow??? thats a big call and incredibly hostile

the .40 is something nulla stated. i guess cash value is always a concern on small caps..

Clearly Nulla has little knowledge of the fundamentals and is commenting from a technical perspective which i commented against

when nulla mentioned .40 you took no offence to it, when i commented to nulla on it you appeared to think you can have free licence to be abusive..

That wasnt abusive..

i invested in adi, not the technology.. i have to correct you many times here.. shale technology was not developed with adi nor the jvp..

Clearly but your timing of investment in ADI relied on untested undeveloped and proven technology. My point is not to diminish the profit you made, but to highlight that you where eternally and unfaltering in your otpimism, despite little to know oil ever flowing till just receently, and clearly now EKA, AUt and ADI would be far better investment propositions then at any other time during that peiod of time.

in fact, aspects of how hilcorp are dealing with the shale play are very concerning to me atm..

Such as what , the fact they have the highest two initial flows and 30 day flows in the entire eagleford??

re my investment in the adi share and its holding in the eagleford play, is not something i believed in, its something i researched and was imho feasible, subject to three factors being correct, cashflow, lease pricing and oil prices.. i always had the conclusion the AMI acreages were the premium acreages.

Clearly the results from Longhorn highlight that is likely to be an error of judgment, an understandable one. Hartleys report confirms this with higher condensate ratios in the NW direction from the AMI.

my adi investment and an later buy into aut was an absolute no brainer.. i totally agree, enjoyed every cent of profit the share delivered from .40's to the .80's

Its imo more a no brainer now then ever, opinions differ.

sold out and sat out the cap raising, which was discussed and totally not believed by yourself, you became super animated and hostile on any mention of a cap raising..

Disagree, not hostile, i dint believe it would be so soon, but in hindsight i was proven wrong and given the result am glad i was.

which imho demonstrated how short sighted you are on this play.

Wrong , im long , looking for late 2011 prior to selling any. although circumstances do change and if i take a negative view on any MAJOR developments id be out in a flash.

now they were a complete steal at .75 if you think the AWE .40 price was not fair.. you have to agree the management of aut gave them away for zip.. but you dont object at all?? either are the sophisticated investors obviously!!

I was away enjoying the snow of Queenstown NZ, but thought it was fair given the rapidly falling oil prices and the overall market panic at the time.

i have been looking at eka, which needed to raise capital, and aut also in the recent weeks, but have yet to be driven in any way to invest..

Good make your own decisions

i have never said any outlook in aut is negative, please point out what post on aut has been pointing out anything negative on it.

Youve certainly implied it many times since getting out, and more so since getting out of ADI in my opinion.

imho aut has upside, but i am discussing the oil price with slipperz atm..

No i dont believe you where, only discussing that.

just take a chill pill and allow a forum to discuss things.. slipperz imho demonstrates some ability to diagnose and discuss issues, i am just discussing oil/gas prices with him if its ok with all here..

cheers

Fine, but i believe you have made implied and direct reference to price falls, several times lately

nulla i am thinking about the .40 bounce also, will it happen?

I believe that was an implied price proposition, not a discussion about oil 12th July

i almost swear there is a poster here (very exuberant) almost trying to talk for you..lol

I believe this was not a discussion of oil price? It was an indirect personal attack.

Any way lets just get on with it, demonstrate integrity and have a great thread like ADI used to be.

 

[condog]

Slipperz i agree with all.

The big thing new readers need to consider is its looking like AUT income will be predominently linked to oil with the LNG prices rather then the dry gas prices often quoted in the media.

65% of AUT interest is in Longhorn which is to the North West of the AMI and looks like being very liquid rich.

All the sources im reading, which most are paid subscriptions of high quality are also calling a volatile but steady appreciation of energy prices at present.

China and India dependent and dependent on a US slow recovery.

 

[Sdajii]

sdajii, i was discussing oil prices with slipperz.. whats with the accusation i have flipped??? what am i flipping on? i am discussing aut and its potential with slippez in respect to what i think is a primary valuation. the price of oil..



btw i had massive capital tied up in adi for a long long time, during the gfc, and hoping adi did not go into liquidation, and believe me, i have never talked up oil like you claim

not sure how awe stole adi?

and i have never been a oil oil oil go go go bull sdajii.. i ask you to please explain where that came from??? oil went from $30 to $80 and saved adi from liquidation.. not a bull at all, just a realist on the prices that occurred..

but sdajii. i ask you a question here.. as you claim adi was a steal at .42.. why is aut not $1.10??? why aut give away its shares at .75 in the cap raising, and not $1.10?? why are you not writing letters to the management on how badly they got their valuations here??? surely you cant allow a steal at .42 be allowed to become absolute highway robbery at .75 for the aut shareholders.. isnt dilution like that an issue to you?

i gather your an investor in aut, so please explain how a act of theft at .42 for awe, is not downright highway robbery at .75 which is about 50% the adi/aut 2.5 ratio??

TIA

I don't think we need bother getting into specific points here. It's pretty clear you were extremely enthusiastic and positive about ADI until recently, and AUT too. I remember you congratulating me recently when I picked up AUT at 66c during one of the brief slumps, yet now you seem to be talking about a 40c bounce? Take a look at the ADI threads, your glowing works, frequent updates with pictures, excitment, etc. Now you have changed. It's not like I'm just imagining this change, it is there. I'm not saying it's bad or wrong, but it is there, it's unexplained, and curiously, you're denying it.

AWE wouldn't have paid 42c for ALL of ADI if they weren't very much convinced that it was worth substantially more than that. Before the 40c offer, ADI was trading well below 40c. Yes, I do think AUT is good value at 75c and yes, I would be very upset if I was forced to sell my holding for 75c. Dilution sucks, but I can buy my share in the SPP, so to some extent it's okay. Also, comparing a hostile take over price to a SPP price isn't exactly apples and apples. One pushes the price up, the other down (at least temporarily). One is an unnecessary evil, the other is a necessary thing. In any case, bringing this topic up doesn't seem relevant to the question you were responding to without answering (what caused your clear and sudden change in attitude towards the Texas oil?).

Answering a question with a question rather than an answer is the tactic used by folk such as politicians reluctant to reveal what's going on.