Josef SchachterFalcon Oil & GasFO.VDON'T BUYApr 24, 2007
Very high risk and possible very high return. He is a risk taker, but he won't take the risk. Very deep and very expensive wells in Hungary. There are a lot of shares outstanding.
Gas play in Hungary. There is gas there but can you get it out and can you do it economically? It is very deep. Exxon is a good partner but a slow one.
Exxon Mobil just finished drilling a well (in Hungary) and did some drill stem tests and came up with fresh water. Most water in an oil well is salty and briny.
In partnership with Exxon (XOM-N), which has saved them. Exxon is going to be drilling one of the large fields and assessing what exactly is there. If they find something, the stock will trade back up.
This one is almost like being in a casino. The asset could be very big. The gas is there but can they take the gas out at a profit. Have spent a lot of money to make it work, so far unsuccessfully.
Used to own this but sold out at about $6 and then they ran out of money. Stock is very expensive and there is a lot of uncertainty and a long timeline.
Totally speculative stock. Pleased that it spent a year in base building at around $0.50. Above its 200 day moving average. Don’t put too much into it. Roughly use a $0.60 stop/loss.
MACD turned around some time in March and is currently trending down. Until you see it crossover, you should wait. Regarding upside, there is some resistance at the $1.02 level. ($0.69 should be a stoploss.)
The gas is known to be there. The question is, is it economic. Have done many wells, and so far has not turned out positive. Still feels there is tremendous risk. If they ever succeed there is billions of $’s upside.
Have an interesting asset base. The issue with this company is the extremely deep, expensive gas drilling in Rumania. Recent joint venture with Mobil Exxon is encouraging. Waiting to see what targets they have identified and what the results will be. Will be news driven. Very speculative.
Speculation drove it up to $7 in 2006 and it then sold off. It is quite positive now that it has finished building a base and has broken above the down trend line.