Its interesting how Saturday morning everyones tone changes and becomes a little more introspective. Especially after a relaxing coffee and steak sandwich. Chewing the fat so to speak with EL and Lepanic.
Having seen how we have travelled in the last few days, I don't think we have found our trading range yet. But the indicators for me so far would suggest it may well level out in the high thirties. You would have to admit that on its T+3 day (after the big run) it bounced and bounced hard and on a day when it probably should have been down. Also I would not be suprised in the least to see this back in the low forties next week on the back of news or one of its daily runs.
The one thing not to forget is the pending MEO announcement on its farm-in deal under negotiation. If the sign off on this with one of the majors (WPL in particular) it pretty hard not to imagine that this will provide a boost not only to MEO, but CUE and MOG as well. The family unites. The detail such as the free carry percentage for MEO and cash component will affect MEO rather that CUE or MOG.
The risks as I see them are that the capital raising in relation to MOG's other projects which are worthy in themselves and secondly, if MEO doesn't get an agreement. At the current price and timings after the announcement I dont see the capital raising as a major threat to the share price. With regards to the contingency that MEO doesn't get a deal and hence can't commit to drilling before the 31 Dec 09 then it is possible that MOG's acquisition becomes void. However, if this were to occur the consequences for MEO would be disasterous and therefore I can't imagine them defaulting.
Another thing to consider is that it seems that Geoffrey Albers is consolidating his projects/assets in the one publically listed company - Moby Oil. Who is to say that this is the last? You may want to read my post on the Orion Petroleum threat (OIP) about the significant board reshuffle there with a new Director that has been involved in Albers' companies in the past. Likewise Albers is a major shareholder of OIP and it has a significant cash backing at the moment.
Finally, you cant rule out the unexpected. With tight negotiations underway between MEO and its prospective partners, the 15% in Artemis held each by CUE and MOG may well become attractive targets.
Cheers and ava gud weekend bro.
MOG Price at posting:
26.2¢ Sentiment: Buy Disclosure: Held
