Pretty sure these folks read our posts, themes are pretty familiar...
Latest from Matt Badiali of Stansberry
After a rough couple of weeks, Interoil (NYSE: IOC) shares are
Company officials recently visited Japan with a New Guinea diplomatic
mission to work out the details of the Mitsui partnership. According to
the New Guinea newspaper The National, Mitsui will fund 100% of a
condensate stripping plant. The financing is in place and construction
should begin soon.
This is another one of our milestones and is extremely important. The
plan is for the plant to go into production by 2012. That means the
company will publish reserve data within the next 18 months or so.
Reserves were always the big target for short sellers. Since nearly 10%
of the free-trading shares are sold short, we stand to see a huge rally
when they have to buy those shares back. All we need to do is sit back
and wait for the next set of drilling results. Be patient, honor your
trailing stops, and we should make a nice gain from here.
Shares slid recently as Interoil's No. 1 critic, Barry Minkow,
"revealed" a court case that he claimed revealed the company to be a
con. Frankly, this is a red herring. First of all, the case is old. It's
been kicking around the courts for more than three years. More
important, Minkow publicized nothing the company hasn't revealed itself.
The company has repeatedly disclosed this case in its SEC filings since
2007. The dispute surrounds how much a former trading partner was paid
for a refinary it moved to Papau New Guinea. The erstwhile partner
received $1 million in cash and $100 million in shares... and now it
claims it is owed more. Regardless of the merits of the former partner's
claim (and I see few), nothing in the case relates to how much oil and
gas Interoil controls.
Only Minkow knows why he's raising a fuss over this nonissue. But I
wonder about the timing. Minkow publicized this supposed revelation at
the end of March. Hedge funds pay Minkow's tab, and they bill by
quarterly performance. So this would certainly be a great time for IOC
shares to slump.
April 6, 2010