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Oilsands Quest Inc Common Stock Message Board

  • jordanaaroncayley jordanaaroncayley May 17, 2007 3:24 PM Flag

    bqi is going up

    because gas is up (oil)

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    • I agree with what you're saying (I thought maybe you were looking to daytrade this, which would be financial suicide). The only thing I would caution you on is the fundamentals: the industry has good ones; BQI has none. Revenues = $0, and yes debt is now under control, but debt financing was essentially replaced by equity financing (PPs).

      Part of the reason this thing is stuck in the mud at $3 right now is the institutions aren't very interested yet. There is some institutional ownership, but value managers looking at this thing get a glimpse of the Income Statement and go screaming off into the night. Getting a JV will bring some of these guys in.

      I agree though, looking for a good entry point is a sound idea. Good luck!

    • What a genius - why didnt we pick up on that fact?

      Can we get somebody too independently verify this trend....

    • Just another dim bulb, aren't you? Ignored. Good-bye.

    • damn, sorry I'm a bit tired.

      1 acre is 4047 square meters, easy calculation

    • Sorry small error in my typing.

      508.00 acres = 4047 m2

      508.000x4047x25x5 = 50 billion barrels.

      If 30 meters then 60 billion.

    • Geez, we can't even get this to go up with even with the BIG Rally on wall street for the last month or so.

    • Article part 2:

      1. Update of Axe Lake project potential based on core data in July (could be upgraded from the 1.25 to 1.5 billion barrels estimate released in early April)

      2. Toronto Stock Exchange listing should provide more demand for the shares later this year

      3. Finalization of Saskatchewan government�s oil sands royalty framework

      4. 3rd party data estimating its potential resource on its first project, Axe Lake, is due out in October (this will significantly lower risk associated with company�s resource estimate and open the door to negotiations for a joint venture). That number will likely be in excess of 2.0 billion barrels.

      5. The company could enter into a joint venture as between fall 2007 and 1Q08.

      # Institutional investors have been buying over the last couple quarters. Major shareholders include Fidelity and Wellington.
      # The stock has limited analyst coverage, which would likely change one more data is released on its potential resource and the company�s risk profile improves.
      # Despite the company�s favorable operational/drilling updates over the past 4 months, which have significantly lowered the company�s risk profile, the stock is currently trading at $3.00 per share (near its recent low). The weakness in the stock price in recent months is attributed to a combination of its recent $30 million private placement as well as a recent lock-up expiration that has resulted in selling by early-stage investors, who purchased shares at much lower prices.

    • cannot paste more than 400 character so..

      What Makes Oilsands Quest So Compelling?

      Posted on Apr 30th, 2007 with stocks: BQI

      An anonymous investor submits: A number of months ago, an article entitled �9 Good Reasons to Like This Oil Sands Name� highlighted the merits of Oilsands Quest (BQI) (formerly known as CanWest Petroleum). Given the recent updates on the company and the recent weakness in the stock price, I thought it would make sense to take another look at BQI.

      Sector: Oil Sands / Oil & Gas Exploration and Production

      Key Asset: Over 500,000 acres of land in Saskatchewan potentially holding approximately 60 billion barrels of oil.

      Why Own It?

      # The company has top notch management with a track record of building an oil sands company (CEO, Chris Hopkins founded Synenco [SYN]).
      # On a macro level, it�s a play on the increasing importance of the Canadian oil sands. Specifically, worldwide, demand is continuing to grow, driven by incremental demand from China and India. Meanwhile, non-OPEC supply growth is not keeping pace. As such, the world is on a trajectory to increase its reliance on Middle East oil. For the U.S., that is a major security issue. The solution? Increase access to �friendly� sources of oil such as the Canadian oil sands.
      # It�s one of the best ways to play the increasing M&A in the oil sands space. On Friday, April 27th, Statoil (STO) acquired privately held North American Oil Sands Company for $0.91 per barrel, or $1.97b U.S. for 2 billion barrels of recoverable reserves. M&A activity in the Canadian oil sands space is expected to increase as oil companies struggle to replace reserves and increase production.
      # The stock has significant valuation support. Statoil�s April 27th acquisition should provide of floor to the valuation of BQI. If you apply the $0.91 per barrel valuation to BQI�s 1.5 billion of estimated resource (assuming 50% is recoverable), you get a valuation of $683 million, or $3.46 per basic share, or about $2.90 per fully-diluted share. It�s important to note that the 1.5 billion estimate is probably conservative and will likely evolve into a 2.0+ billion number in July, when management comes out with its official OBIP estimate. That would turn the $3.46 and $2.90 per share valuations into $4.60 and $3.86 per share, respectively. If you also assume that BQI can employ newer oil sands technology to increase recovery, such as Petrobank�s THAI technology, which is said to be able to produce recovery rates of 80%, the $4.60 and $3.86 figures turn into $7.36 and $6.18.
      # The above valuation discussion only applies to 2.0 billion of estimated resource. Management believes that the company�s property could potentially hold up to 60 billion barrels. So essentially, investors who buy at the current price get a free option on 58 billion+ of the company�s resource potential. If the company�s property actually holds 60 billion barrels of resource, the stock�s valuation would, theoretically be 30x the figures noted above if you assume the company�s land is homogenous and its characteristics/oil content is consistent throughout. Clearly, this would be the upper bound of the valuation.
      # Recent options activity indicates that investors are discovering the BQI story (heavy call option volume for July 5 strikes and October 5 strikes). The volume on calls outweighs comparable put volume by a significant margin. Clearly, some investors are betting big on BQI�s prospects.
      # There are numerous near-term catalysts could boost the stock Updates on summer drilling program over the next couple months

    • Drilling results typically 25-30 meters of oilsands.

      508.000 acres x 25 meters/5 (5 barrels per m3): results is aprox. 50 billion barrels. We don't know how it looks everywhere - I haven't drilled.

    • I wouldn't say there are SO many other players out there. If there were that many companies out there sitting on such large reserves, the price of oil would be about $20/barrel. Which it will never again see in our lifetimes.

      Yes, in terms of the overall oil industry, BQI is a little fish. They're not exactly the next Exxon. But if their reserves truly are as large as it looks like they are, this company's going to get bought out some day at a HUGE premium over the current price.

      Be patient. If you're in this looking for a quick buck, you're in the wrong stock. Otherwise, sit back and enjoy the ride!

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