NZ Oil & Gas (NZO)

[fish]

In this market nothing makes sense. PPP has net cash of more than 19 cents and the market is selling them at 17.5 cents. So figure that one out. NZO can go lower simply on fear alone. We may see below $1 if the world markets continue to tank.

nzo can go lower-much lower-its not fear alone-its a deadly combination of fear ,margin lending and need for liquidity .

All 3 could be combatted by a buy back programme-the sooner the better .
There is no one solution to the current financial crisis but lots of smaller remedies . If the board does not act to remedy the problem there may soon be much less value to an nzo share .
After saying that I do believe we have an experienced and brilliant board that has become shareholder friendly and will make the right decisions in this world crisis .

[Unicorn]

Interesting day today - the day that oil crossed back under where it was a year ago.

For the forseeable future I see low production cost energy (NZO) being far more lucrative than relatively high production cost steel making materials (PRC). Current very strong income streams (NZO) are much more attractive than dubious income streams that will not start in earnest for at least another 9 months (PRC). I think PRC is currently vastly overvalued compared to NZO.

Further falls in the value of the PRC stake may reduce NZO nta but will not impact on NZO earnings - which I calculate are running at about $300,000 net per day. That is about $9M a month, which is hardly the stuff of doom and gloom!

I do not see the world economic recovery being possible with significantly reduced energy consumption. I also do not see the OPEC states accepting oil below $50 - which looks like it may be around $100 NZ! NZO can live, quite happily, with that.

The NZO share price fall over the last few weeks has been disappointing, but not that unexpected given the combined impact of the NZOODs and the financial meltdown. Unfortunately the resultant volatility of the NZO share price has given the impression of a struggling junior oiler, when it is now a cashbox/producer. It would help the long term image of the company to get more stability into the share price. It would also be helpful to increase earnings per share. These are the reasons why I prefer a buyback, albeit on a limited scale, while shares are being offered cheaply. Bailing out overly leveraged shareholders is not a reason for a buyback - enhancing value for continuing shareholders is the objective.

I am remarkably relaxed about my NZO holding. The figures on paper are not particularly impressive at present, and on reflection my decision to ignore the investment for 6 months after the NZOODs to let things settle was a poor one. But I still see a lot of value in the investment, and I retain confidence in the management team.

[zorba]

Unicorn,

Surely the NZOOD cash raising is good for NZO for any shareprice under NZD1.50 ?

As share price moves downward below $1.50 the cash brought in by the NZOODs helps to buffer the shareprice by increasing the cash backing and therefore should mitigate against further downward movement.

Maybe somewhat academic given the global slaughter which is driving everything down, including PPP which as mentioned by another poster is now trading at below its cash backing.

NZO and PRC AGMs will be interesting !!

Z

[arjay]

I am also relaxed Unicorn - trying to keep a positive light on things. For many of us longer term shareholders, todays SP is still over triple what we paid for them a few years ago although I admit to being a bit dissapointed about it not being 5x more. Secondly, to people like McDunk who say NOGgers were foolish not to have got out earlier..... well, fair comment - but that would have required a willing buyer and I would not have been happy with the thought that knowing the market would crash I would then preserve my 5x advantage by selling my shares to someone who will tomorrow lose their house.

So, I remain relaxed and my lean-too at Coromandel will have to go without paint for a little while longer.

[the machine]

do nzo still have any hedging positions left to fill - if so may end up selling oil at a higher price than on the market


M

[corsairx]

I am a big fan of the way that the board has handled NZO.

As I have already posted I sold out a week or so before the dilemmas of the crisis hit. I have never denied that I see this company as fundamentally strong compared to the market. I sold out down. I am in no way gloating after this. But at the same time I need absolutely rock solid value before I reinvest. For myself, looking at NZO this is around the 93c mark. Based on pure cash in hand that I can depend upon.

[duncan macgregor]

What an amazing lot some of you are. Some even say they would rather hang on long term than sell to some one else to take the loss [BULLSH*T]. Not one of you questions in this era of crashing banks, bailouts,and volatile cross rates where and at what percentage this money sits. America is going under, i wonder if any of your money is there.
Its bad enough to be that fundamentely stupid that that you dont insure your self with a stop loss, but even i would expect you to ask the real questions. Did it ever cross your minds that this money might be sitting at risk?. Management come out with the usual trust me, we know what we are doing, which simply keeps the faithfool content. Macdunk

[Major von Tempsky]

Hmmm, I was merely going to observe that oil is down to $78.54 overnight and the DOW just 50 points so we could be getting near bottom....but I couldn't avoid reading McDunk's amazing, ignorant, lunatic rant which seemed to focus on 2 things both highly questionable and irrational

(a) he feels personally aggrieved if some shareholders choose to hold rather than sell (which would thereby actualise a theoretical loss, burning their boats and abandoning the recovery in their position and gifting it someone else)

(b) he says "America is going under" whatever that means.
If America was going to go under if would have done so in the 1930's Depression when their economy sank 50% and governments everywhere were abysmally ignorant as to what was happening and did stupid things such as heavily cutting government expenditure and trying to maintain a Budget surplus and tight money. But it didn't, it rebounded even then within 10 years.
Or during WW2. Or during the Cold War.
They will have a bit of a recession now and rebound stronger than ever within 2 to 3 years.
Look what Germany and Japan managed to do after WW2.

I think you have been at the wacky baccy McDunk and you are trying to accentuate your high.

[AMR]

Dow rallies 6% in the last half hour...could this be the bottom?

[duncan macgregor]

Hmmm, I was merely going to observe that oil is down to $78.54 overnight and the DOW just 50 points so we could be getting near bottom....but I couldn't avoid reading McDunk's amazing, ignorant, lunatic rant which seemed to focus on 2 things both highly questionable and irrational

(a) he feels personally aggrieved if some shareholders choose to hold rather than sell (which would thereby actualise a theoretical loss, burning their boats and abandoning the recovery in their position and gifting it someone else)

They will have a bit of a recession now and rebound stronger than ever within 2 to 3 years.
Look what Germany and Japan managed to do after WW2.

I think you have been at the wacky baccy McDunk and you are trying to accentuate your high.

MVT to attack the person with childish sneering comments only shows you up as the irrational person that you are. The rational person sells up then comes back when the market rights itself. Your policy of holding at all costs, then averaging down buying more of downtrending stocks will lose out big time. I would imagine you will end up jumping out the window one day from a great height, shouting [THE WHOLE WORLD IS MAD EXCEPT ME]. I expect your portfolios value is down by half this year simply because of your self rightcheous attitude of never being wrong. I got this one right on the button MVT, you got it wrong, which is costing you read back the thread with an open mind and learn from it. Macdunk