Hi Everyone, Happy New Year
As bad as the dilution is if the company grows, the shares will be "undiluted", Work on increasing the value, increase reserves, increase production, reduce debt, eventually the amount of shares will reasonably reflect the outstanding shares. It is our dreams to see cll with 1 billion shares outstanding and no debt, but of course the 1billion shares must be completed with increased profits, production increase, increase in the reserves and overall value of the company.
But the question is how we accomplish these ultimate goals. We have debt, a huge one that may be crashed under its heavy weight if oil drops even to 50.
So short goal should be how to reduce the debt. I think focus on getting fast cash organically. Do not buy equity or reverse split, just reduce debt and how better to do that than quickly producing sweet oil for the high oil market, this sell non essential low grade light oil in Canada quickly produce oil in Latin America by leveraging PDP.
It is not brainier, but management seems to be solely focused on oil sands, that are good, but it is hard now. While oil is high increase sweet oil production and halt oil sand development until debt is manageable then refocus on oil sands, in the long run oil sands will be important, but for cll with its heavy debt, is risky given the volatile oil market. When oil goes down every one will cut investment in oil sands, then with the cash you have accumulated while every on is shying away developed oil sand cheaply and since it takes time to do so by then oil will be up and you can profit, this is not to time the market, but to be contrarian. And to be able to do so you need to survive and develop the stamina to withstand the crashing effect of debt.
Can someone more knowledgeable comment on the pros and cons of merging cll and pdp. Is it hard to do so? And how much shares will the new corp. pdp-cll have?
Who benefits from this merger, cll holders or pdp ? Imagine if even pdp was just producing 10,000 bbl/d and selling it at market price, its shares will be in the teens and cll will have hundreds of millions of equity in pdp and that could have reduced the debt by just selling them. Now imagine if cll and pdp are one company. But I know merging is not that straight forward and hence the request for enlighten
thanks
B
