catalyst for a re rating, page-2

Hi bitzer,

I have been pondering the same - its an unfortunate thing about markets - that we have to rely on other people to buy and sell to effect our own price realisation. You can go away and value the stock, do all the work in the world, buy it cheap, but you need other people to see the value and buy it for the price to go up - and they of course won't want to pay too much, and sellers can be twitchy. Frustrating.

I generally think the market is pretty stupid - case in point is AUT - stock was languishing at $2.60/sh with instos selling down (and me buying up as much as I could) right up until the day before Baytex's $4.10/sh bid was made. Yesterday, stock was trading at $3.96/sh, who knows why. An announcement came out at about midday that Baytex had raised its bid to $4.20/sh - I had time to buy the hell out of AUT, and it took an hour before anyone got it and the SP jumped to $4.18/sh and I sold. My view - market often pretty dumb (unless there are participants with inside information, which is rampant IMO - otherwise without that its generally aimless and stupid), and has undervalued a lot of companies that were then taken out or attempted (eg Warnambool, AUT, Graincorp (not successful), even PNA is getting a good look at a decent premium to the stupid ASX view on things).

The CMT SP had a nudge on the Pandora entry, and on the earlier Wison commentary, and of course came dribbling back down so it seems short term movements are governed by the trade around news flow, with people have to take 20-40% profits.

We, are holding this stock for the 1-500%+ move.

Which comes back to your question - what would be a catalyst? Your earlier comment about booking reserves at Pandora is accurate, I think, although a lot of other companies (eg Cooper Basin shale gas) get decent value for their 2C contingent resources. However, PNG seems to be a place that doesn't attract value readily - HZN basically has zero value in its SP for PRL 21, and only just got a bit for PRL 4 after it received Government production approval. Pandora, is presently valued at nil for all participants, despite probably being over 1 TcF in gas (gross).

If one of the regional players like Talisman, HZN or STO to its act together and made a decent effort to develop the western province PNG project, or at least started to talk about something more than conceptual, including Pandora in the scheme, then you would imagine a re-rate.

T/O is the other one - no idea why HZN is not in Pandora, and snapping up CMT would be the way to get in while also picking up interests in PPL 435-437 for the land bank.

Apart from that, a look at the development plan on Pandora suggested no real work on it for years, so that could be one thing pushing back realisation.

some thoughts for the banter
Cheers