Well, to start I'd like to declare three things a) this is not a KEY bashing session b) I don't hold KEY shares, all my funds are committed elsewhere (including a large chunk in EGO) c) Getting the Canning tenements back from KEY will most likely not happen, but ASIC investigations and/or legal action against the EGO board that gave them to KEY has my full (even if limited) support.
One take on the EGO situation is that EGO has a large portfolio of tenements, gas reserves confirmed, a contract in place to sell the gas extracted, funding for the gas plant required to process it (largely from the primary gas consumer ... who is anxious to buy it !!!!) and a refinery to sell resulting condensate to .... looks great !!! Income stream to come online and more possibilities for more good stuff happening in the area !!!
However .... EGO's share price is dropping like a proverbial dead ferret. Even the MD himself sold a large chunk of his shares when they got over 4 cents (hows that for confidence)and keeps offering shares in repeated cash raising activities at a discount to institutional investors. There seems to be little action on works required/drilling , previously unheard of court proceedings with landowners slowing things down .... all things happening with all the urgency of continental drift !
The logical conclusion would be there's obviously dissonace between the observations .... the mismatch of what is happening and what should be.
It seems investors do not trust the EGO board (with little things like assets transfers, high consultant rates/remuneration, issues of options to self, posponed meetings to shore up votes etc .... who could blame them), they are not communicating (beyond rehashing what is effectively the same old presentations with a couple of tweaks time and time again). They are perceived as not performing and not doing their jobs (beyond a perceived level of personal interest .... they seem to do that quite well).
Now .... why is this relevant to KEY shareholders. I Hate to break the obvious news here guys - but the EGO Board seems to be transplanting itself to KEY.
You have our "full time EGO focussed" Managing Director as your Board Chairman now, his Son is now the MD and they're even operating out of the same offices !?!!
Hmmm ..... so to KEY Shareholders I'd just like to say, you've apparently done the right thing and ousted one set of dysfunctional board members, please be careful you are replacing them with something better !
Shoe
KEY Price at posting:
2.7¢ Sentiment: None Disclosure: Not Held
(20min delay)
