Macro Tsimmis

intelligently hedged investment

Transmeridian (TMY) update #11

Posted by intelledgement on Sun, 11 Nov 07

Transmeridian (TMY) had a second consecutive “stealth” release of their quarterly results Friday, choosing again to forgo not only a conference call with analysts and investors but even a press release. And why not, with literally almost nothing to report, in the sense that with production from the company’s South Alibek field in Kazahkstan shut down for the entire three months, only a piddle of barrels of oil from inventory were sold (111/day) in the quarter. (Guess you know you have a dog of a stock when management get in the habit of burying news update after news update on Friday afternoons following the close of the market for the week, obviously counting on the weekend, if not to cause investors to forget the info, at least not to be able to sell instantly upon learning of it.) Production for the first nine months of the year are now averaging 2200 bpd, which is far short of the minimum 4000 bpd needed for the company to sustain operations on a cash neutral basis, to say nothing of the 2007 target of 6500-to-8000 bpd the company hoped to produce in order to be able to service their debt and fund development drilling.

But that was then and now the focus is on management’s efforts to sell the company, or at least the South Alibek field license. No new news on that front (and thus another incentive to eschew a conference call).

The two slivers of good news were that international sales of oil went off at a record $66.48/barrel, and even with this dead quarter, production for the first nine months of the year overall is still running 24% ahead of last year. Course, that says more about the company’s pathetic 2006 performance than about 2007.

Anyway, we TMY shareholders continue to wait for Godot here, hoping against hope that when he arrives he won’t have blown his paycheck on wine or philosophy books but never-the-less will be in a buying mood, and ideally in the market for oil to go with his surfeit of vinegar.


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