Registered: Mar 2002
03-26-10 07:28 PM
New York Post article yesterday (25 March), but it was released well before 9.30am ET on that day, so not really a catalyst.
Still interesting background reading:
However, after seven years of exploration and drilling, InterOil has yet to produce any proven commercial oil or gas reserves.
Nevertheless, InterOil's stock is up an astounding 385 percent since the start of 2009 -- a feat critics attribute to InterOil's flurry of uplifting press releases about its drilling and exploration plans.
On Jan. 20, for example, the company issued a release announcing "indications of oil" at a well it called Antelope-2. News of the so-called indications sent the stock up more than $6, or 8 percent, to $81.38.
InterOil has a market cap at $3 billion. (Exxon's is $314 billion.) Its only revenues come from oil refining and distribution, a small business that allowed the company to post its first-ever full-year profit, of $6 million, in 2009.
InterOil spokesman Wayne Andrews said that although the company isn't currently making money on its oil and gas exploration, and that a plant may take to 2015 to build, the stock is not overvalued.
"We're just a small company looking to partner with a larger company to develop the resources we've discovered," Andrews said.
Yet some analysts agree it's a risky proposition.
"It's a speculative stock, there's no doubt about it," said Pavel Molchanov, a Raymond James analyst.
"The profitability of the refinery is limited," and "the stock is trading at $70 for the reserve potential," said Molchanov, who has a "hold" recommendation on the stock.