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SCL is still low even though the price of oil is sitting high. What gives?

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Cuervo
Occasional Contributor
Since listing on the AIM this share has not had much happen to write home about. Oil is sitting really high and yet NOTHING! I suppose once the newly appointed staff start getting in to gear and a new headline appears we should see something happen. Any thoughts?
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8 REPLIES 8
Not applicable
Well, to capitalize on high oil prices would mean that you would actually have to be producing oil, wouldn't it?
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phd
Contributor
It shouldn't be necessary to actually be producing, as long as the company holds assets with production potential. Their value would be related to the price of oil, albeit a future price. SCL should see some action once the roadshows get underway after easter.
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phd
Contributor
Of course, until the company does actually start producing oil, it will remain little more than a speculative share. And once production starts, the share price should theoretically increase dramatically.
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Super Contributor
- Lots of if's and but's . Production is one thing, producing at a profit and being able to pay div's is another. How much longer will it take for all that to happen ? Until then it's highly speculative.
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Not applicable
exactly, virtually impossible to put a NAV on a resource explorer. It takes years to get into full production - and an investor has to make a guess as to the quality of the reserves. Are they all at surface level, is it fragmented, etc. Then you need to construct the plant, then you need to estimate what hte operating costs are likely to be. And at this stage, all that I can see is that they have an exploration license, no near term production assets. And they only have R5m odd in cash. You need a hang of a lot more than that to build a production facility. Probably you will need around R5bn, so they are a heck of a long way off. No ways are you going to raise this kind of capital on the open market - you have to have an institution behind you. This is just one of the all time great speculative plays - with the smart money thinking they will get taken out by Total or someone. But that talk has been going on for ages now, with no deals to come about yet. If they had anything of substance, I promise you that a deal would have been put on the table by now. Pile of junk this, IMO
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Frequent Contributor
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Cuervo
Occasional Contributor
Well at R1 has fallen from 2,60 where I bought so now I am going to hang on and wait it out. Check out the sens that they have today. Bliksem this thing has fallen like a rock and I am going to hang on. I am long and selling at 300 cents.
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prophit
Occasional Contributor
I let this one go at 230, maybe time to get back in!? Anyone think this one could drop as far as 50c?
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