Petrobank/Petrominerales

[toxic921]

Does anyone have the new basis in petrobank and basis in the Petrominerales spinoff (in US $ hopefully)?

[davidc257]

Would it be the closing price on December 31, 2010 which was $33.34?

[bobs]

I suspect we all now have our shares in the 2 companies and I'd like the lastest thoughts on which might have the most upside or simply hold them both????

[setliff]

dan you have a fair value on pbg at ~$75. is this based on post spinoff or pre spinoff? if pre spinoff what factor would be appropriate to adjust that FV number to the present.

[dan_s]

See the "Sweet 16 Detailed Update" for current Fair Value estimates on each company. Actually, I have increased Fair Value estimates on a couple since then.

The Sweet 16 Detailed Update is a "living document". I update it the day before each newsletter, so there is another one coming out on Monday, January 17 that I'm working on today.

To answer your question:
> $75 was pre-spinoff valuation for Petrobank.
> Fair value estimates today are: $40 for Petrobank (PBG) and $53 for Petrominerales (PMG)

BTW, for those who like dividends, a direct investment in PetroBakken (PBN.TO or PBKEF.PK) is recommended. The current dividend yield is 4.4% per year. Dividends are paid monthly, which is nice. See my company profile on PetroBakken.

PetroBakken would make the S-16 on its own but for each share of Petrobank you already own a share of PetroBakken. Petrobank owns ~58% of PetroBakken. Do the math and you will see what I mean.

[prince_jake_33]

Dan I am wondering about switching petrobank into petrobakken.

I have been trying to understand the "thai" process and its general application to large acreage once it gets developed. Research was done in the 1970s following the crude oil imbargo applying insitu retorting to the Colorado shale rock. That Shale rock is of course completly different from the Bakken and other shales under development now. A couple of problems that I recall with insitu retorting was effect on ground water and uneven burn through the the block of rock being retorted under ground. I think the air was breaking out unevenly.
I know little about this process but wonder if Petrobank will be able to make it work. Potential application may be huge. But I really want Bakken investments.

[dan_s]

Petrobank's THAI process is for heavy oil fields, primarily sandstones. It has nothing to do with the shale plays.

I just send my draft of the company profile up to Petrobank for their comments. I should have it posted on the website (for Premium Members only) this weekend. You should read it before you decide.

The PetroBakken and Petrominerales profiles are already on the website. Both under the Sweet 16 tab. They have been reviewed by the company. The heading on the last page of the PMG profile is obviously wrong so just ignore that and we are getting it fixed. It is the PMG forecast.

[dan_s]

We are 99% sure we are going to webcast next week's Petrobank presentation to our out of town members. Check next week's newsletter for details. Kim is working out the details now.

[k1f]

<<Does anyone have the new basis in petrobank and basis in the Petrominerales spinoff (in US $ hopefully)?>>

Is it computed from Dec 31st ($33.34) or the date shares are actually credited to your account in January?
Ameritrade is characterizing the shares as "non-taxable spinoff" - anybody have any further details on the
tax status and computations involved?

[dan_s]

I will send an e-mail to Petrobank to ask them about this. I was told that it was a taxable dividend for U.S. shareholders but I really cannot explain why. Usually, when a company is spun-off all you do is allocate your orginal basis between the two stocks.

[setliff]

dan would you ask them if they have any plans to go onto the nyse with adr's?

i know they are on pink slips, but the volume there is so low it effects liquidity.