Falcon Or Pigeon

Aug 14th, 2009 – Comment

Lou, Can I get your opinion on Falcon Oil and Gas. Where do you see the stock heading in say 6 to 12 months. Thanks for your input. Much appreciated. Mike Hi Mike, Falcon Oil and Gas Ltd ( FO TSXV) has been on the hunt for unconventional oil and gas assets for sometime with […]


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falcon

Lou,
Can I get your opinion on Falcon Oil and Gas. Where do you see the stock heading in say 6 to 12 months. Thanks for your input. Much appreciated.

Mike

Hi Mike,

Falcon Oil and Gas Ltd ( FO TSXV) has been on the hunt for unconventional oil and gas assets for sometime with mixed results at best.  Last year they did workout a joint venture with Exxon Mobil  to develop some areas that they control in Hungary.

The JV with Exxon Mobil is structured in phases with a total budget of $300M if all milestones are achieved. If the drilling is successful Exx0n Mobil will earn a 67% interest in the land under contract. Falcon has retained 100% working interest in other acreages in the Mako trough and has hired Merrill Lynch and BMO to search for joint venture partners.

The company has also acquired a land position in Australia that they are currently in the early stages of developing.

fo2

The three year chart tells the tale of the trials and tribulations that FO has endured going back to the spring of 2007 when their efforts in the Mako trough hit some challenges.

I checked out the yak on the bull boards and some investors are ready to bring the coals for a fire to roast the management team over their performance. I suppose years of effort and hundreds of millions spent with not a molecule of energy to show for it will get people aggitated

Even the recent uptrend that started in late 2008 has been broken so its time to evaluate the risk in the trend.

fo

The three month chart shows the resistance that the stock is struggling with at $0.50  and that volume has been weaker than you would want to support an advance.

If you are going to take a position in FO put a stop in to protect against a loss.

Happy Capitalism!

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