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HyperDynamics
(OTC BB: HYPD) Makes New All Time High |
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HyperDynamics, our potential
elephant in the oil and gas exploration business off the West Coast of
Africa, started rocketing up the charts last week, and made a new all time
high yesterday.
The stock, first introduced at $1.76
in the September
20th edition, saw a high of $2.14 shortly after that edition.
Subsequently, the stock succumbed to selling pressure, and had quietly
dropped into the $1.50 range.
Last Thursday the stock traded 500,000
shares and began running up. Yesterday, it made a new high of $2.25,
confirming
a pattern of higher lows and higher highs.
As I write today's edition, the stock
has pulled back and is holding steady at about $2, taking a well deserved
breather.
I don't know exactly why the stock
made such a big run, but I have a theory. Investors are starting to look
for companies with exotic resource concessions in foreign lands as a place
to seek out profits. I received a number of emails from members who had
read comparisons between HyperDynamics and Ivanhoe Energy.
Ivanhoe Energy (NASDAQ: IVAN)
is an oil and gas exploration company with a large, undeveloped concession
in China. As you can see from the chart, IVAN has rocketed up the
charts since September, making a four fold run from the $2 level
to a high of $8. On $10 million in annual sales, IVAN
is now sporting nearly a $1 billion market capitalization. Is it
any wonder investors are looking at HyperDynamics, with a mere $50
million market cap, as the next potential IVAN.
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HyperDynamics-
Streaky Like a Big League Slugger |
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HyperDynamics has a fairly
schizophrenic and unpredictable chart. Like a big league slugger, the stock
tends to get very hot in short bursts. As you can see from the chart, there
have been three violent moves to the upside since early July. Each started
from a higher low, and made a higher high. If the current move is as strong
as the move in July, one might expect the stock to trade up into the $2.75
range before this hitting streak ends.
Whether it cools off now or continues
higher is of no consequence. The stock can probably be depended on to deliver
a streaky move once a month which will take it to a new high. It's now
managed to repeat this pattern three times in a row. If you believe past
performance is the best indicator of future performance, it is destined
to hit more home runs in the future.
If there is a large pool of oil under
the ocean's surface off the coast of the Republic of Guinea, your grandchildren
could be spending the quarterly dividend paid out by the company.
Today, just after the market closed,
HyperDynamics
issued a press release. The company is planning on expanding the seismic
data acquisition program from the current 4000 km to as much as an additional
20,000 km of new 2D seismic data. The current seismic data acquisition
program will be completed by the end of November, and then expanded from
there.
I believe once the 2D seismic is
completed, the company will be shopping for a deep pockets partner. If
the right deal rolls in, you won't own enough stock when the news comes.
Here is the complete text of today's
press release for your review:
| Press Release Source:
HyperDynamics
HyperDynamics' SCS
Plans Massive Expansion of Seismic Acquisition Program Offshore Guinea,
West Africa
Tuesday November 11,
4:05 pm ET
Oil and Gas Economics Cause Market
to Favor Foreign Concession Holders
HOUSTON--(BUSINESS WIRE)--Nov.
11, 2003--HyperDynamics Corp. (OTCBB: HYPD - News) announced today that
its energy subsidiary, SCS Corp.'s management committee has implemented
a plan to greatly expand the current acquisition program offshore in the
Republic of Guinea, West Africa. The expansion is contemplated to grow
from the current 4,000 km to as much as an additional 20,000 km of new
2D seismic data. The current 4,000-kilometer acquisition program commenced
in late September and will be completed this month. The existing program
targets a specific quadrant of the concession and was designed using the
results of the seismic analysis work performed by SCS on the data acquired
in 2002. Neil Moore, president of SCS, stated, "The results to date have
convinced us that we have a unique opportunity and the economics appear
favorable to negotiate the acquisition of an additional 20,000 km of new
2D seismic data. This will give us a grid over the entire offshore concession
and will allow us to begin evaluating other areas of the concession while
at the same time we continue to focus in on drilling prospects within the
initial quadrant. As we move forward and are able to drill our first well,
we expect that this additional coverage will help us support the characteristics
of a working petroleum system or systems as the case may be."
Kent Watts, chairman
and CEO of HyperDynamics, said, "Our management committee has determined
that the timing is right to expand our data acquisition. The oil and gas
industry economics and market valuations are increasingly favorable for
small E&P companies that hold foreign concessions, especially during
these times of tight supply and growing demand. It is important to note
that the capital markets have woken up to these facts as money is flowing
into small aggressive companies that have the potential to supply the hydrocarbons
our country desperately needs." Watts continued, "Environmental Remediation
(OTCBB:ERHC - News) has minority working interest offshore West Africa
and just announced that almost $500 million was bid on blocks where they
have their interest. Ivanhoe Energy (NASDAQ:IVAN - News), which has a 900,000-acre
block concession in China, has seen their stock soar on huge volumes while
raising millions of dollars for capital expenditures. Far East Energy (OTCBB:FEEC
- News), also with a concession in China, has seen a 200 percent rise in
their stock while raising millions in new capital as well. We believe that
as we are able to effect this expanded acquisition plan, we will be continually
enhancing our shareholders' value. As the marketplace sees great value
in our industry, we are moving aggressively to maximize this 16 million
acre asset as now is the time for us to be aggressive in taking the next
step toward our goal of drilling our first well sooner rather than later."
About HyperDynamics
HyperDynamics is a provider
of integrated information technology services. HyperDynamics' wholly owned
subsidiary, SCS Corp., develops geophysical data services for the oil and
gas industry including its integrated SCS NuData(SM) services while its
No. 1 focused priority is exploring and developing new regions of Africa
for energy production.
Safe Harbor Statement:
The statements contained herein that are not historical are forward-looking
statements that are subject to risks and uncertainties that could cause
actual results to differ materially from those expressed in the forward-looking
statements, including but not limited to market acceptance of new technologies
or products, delays in testing and evaluation of products, and other risks
detailed from time to time in the company's SEC filings.
--------------------------------------------------------------------------------
Contact:
HyperDynamics Corp.
Kent Watts, 713-353-9400
kent@hypd.com
or
Investor Relations
Stock Enterprises Inc.
Jim Stock, 702-274-5400
stockenter@aol.com
Ashland Capital
800-277-9081
ashcap@adelphia.net
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