I strongly advise that everyone read the discussion area of the seekingalpha article titled "InterOil's Increasing Value Proposition" in which an industry expert named indoreservoir obliterates all of Bonk's arguments one by one. The obliteration extends from the technical merit and precedents of open flow tests based on comparable scenarios to correcting the valuation at which Bonk thinks the Rovuma field in Mozambique is being transacted.
At $1.10 per mcf for much more expensive gas that doesn't have any third party certification or project agreement with Mozambique and is several years behind IOC's Gulf Project in development, the positive implications for the value of IOC's resource is staggering.
I can't wait for another one of Adam Gefvert's uninformed articles (this one supposedly on valuation? so it's no longer a fraud???) in which he'll probably draw an incorrect comparison to Rovuma. It will just show the futility of the shorts' few remaining arguments.
Sentiment: Strong Buy
"At $1.10 per mcf for much more expensive gas that doesn't have any third party certification or project agreement with Mozambique and is several years behind IOC's Gulf Project in development, the positive implications for the value of IOC's resource is staggering. "
You may want to read my response. He missed 48 TCF in Area 4. Links to Bernstein and RBC confirming the per mcf value in the 35 cent range.
And how is it several years behind IOC exactly? It's fully partnered with high quality firms and first cargo is planned for 2018.
Sentiment: Strong Sell
The only short argument available is the deal will be bad. But even this can easily be disputed by several factors.
1] $1.20/mcf is the going regional rate
2] the bidding closed on 2/28 with at least 2 majors participating and probably 4 bids or more
3] 3 ib's involved with the process
4] Westlake joined as an analyst 1 week ago with much enthusiasm
5] O'Neil is highly supportive of the deal and may be laying down conditions this week as he meets with 2 foreign PM's
6] Reports that the IOC are in elevated spirits
There are many others, but the point is that a deal is being finalized and at the bare minimum it will be acceptable and will push the pps to new highs.
ps once the deal is announced, I expect a bidding war to ensue
Sentiment: Strong Buy