Jake0002,No it wasn't me.In some ways a merger would make really...

Jake0002,

No it wasn't me.

In some ways a merger would make really good sense. You'd only need one board of directors etc. So you'd make considerable cost savings that way $400,000+ per year.

However, how are you going to value PGS's oil reserve milestones to start with?

Then you have to look at the outlook regarding its oil prospects in PEL514, some of which have 3D data already done on them. Some like OGY waiting completion of 3D and I think both have some areas left with no 3D.

From OGY's perspective how do you value the PEL110 "Elephant prospect" with no 3D but in size dwarfing other prospects.

You also have the Seabiscuit issue, where so many of the shareholders bought into the company for that play which is in Texas not the Cooper Basin. How do you value it because if its successful you're looking at a serious multiple of the current shareprice (10x minimum). If the 50-60% success probability instead turns out to be a dry hole, it has no real value.

For a merger to happen you would need to get that significant group of Seabiscuit supports onboard. I just can't see it happening because they don't need to do anything other than wait 6 months, they have enough cash to drill it etc, so are they going to take a 50% or thereabout drop in potential value for where PGS is right now? To me they won't, after all if it is successful they could easily buy PGS outright. They could pay a premium and it would still only cost them then 5-15% dilution.

On the otherhand if Seabiscuit is a failure then PGS would hold the upperhand, as the large number of Seabiscuit shareholder's would want to sell out of OGY.

Either way I think the time for action between PGS & OGY will be once Seabiscuit is finally drilled.

Mauro,

Start by asking the company directly why it isn't doing these things, if you don't get good answers then find out who is behind the largest shareholding and contact them for there views on moving forward, as they have the same voting power as the board combined. Shareholders need to get proactive.

Directors are getting grossly overpaid for running small company's that they are bleeding dry year after year, while the poor longterm shareholder has little chance of seeing a return on there investment.

LOTM