Saturday, June 09, 2012 6:58:56 AM
GM blue dog, nothing like the am for some DD 
As for the linkage between SIOR and Cactus Drilling, the mods on the board were quick to note that Dan Jr was part of Cactus Drilling (the one with "over 50 rigs") and frequently made it a cornerstone of this board's DD.
Personally, I think MWM and I did a huge service to this board by pointing at the truth of this long standing mod assertion.
For example:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=72983568
geopressure
Wednesday, March 07, 2012 12:45:14 PM
Re: MU_Redskin1 post# 5244
Post # of 6378
I agree with much of what MU_Redskin1 has to say...
On the 25th of February, 2012, SIOR updated their website. Included in the updates was the line, “Superior is poised to commence new horizontal drilling as early 2012” being altered to read: “Superior will commence horizontal drilling in early to mid 2012”. I see this meager change, as small as it may seem to be of great importance, & I will try to explain why.
This is very, big news, despite the fact that it has nearly been discussed on this board. As far as we know, SIOR has no noteworthy cash available to pay for any horizontal drilling at this time. However, the A/S increase which was voted on in November of 2010 has just taken effect, so shares are available for dilution if SIOR management so chooses.
With drilling to take place within the next 6 months (early to mid 2012) how do we think that SIOR will fund these drilling operations? According to Sandridge, each horizontal, Mississippian Lime well-bore cost around $2 million $D, which is cheap compared to other resource plays, but rather costly if SIOR plans to pay for this via diluting on the open market.
[Scenario #1] If SIOR is able to fetch $0.01 per share, then full dilution would pay for only 2 well-bores - and we all know that the stock wouldn't stay in the $0.01 level for very long. I am not a finance expert, but I do not see dilution at the current rates as a reasonable means of obtaining drilling capital.
[Scenario #2] An alternative to diluting on the open market would be to assign shares to a drilling/completions contractor, in return for their services. Those who frequent this board will know that SIOR's CEO, Dan Lloyd Jr., is the majority interest holder in Cactus Drilling (the largest privately held drilling/completions contractor in North America). I propose that SIOR will place a portion of the now available shares with Cactus Drilling in exchange for one or more 'turnkey', Mississippi Lime well-bores.
Assuming that this scenario is correct, then it stands to reason that Dan Lloyd Jr. & the other Cactus Drilling Interest holders would want to get as many shares as possible for the well-bores. When SIOR's price per share started to increase around the 1st of this year, SIOR Management (also being Cactus Drilling's Management) decided that they had best get this deal moving ahead in high gear. Considering that the A/S increase was voted on in 2010, but not actually increased until March, 2012, indicates to me that the deal was at a standstill. Now that SIOR's stock has come alive, we have seen two important events transpire: 1) SIOR's statement on their website that was mentioned above & 2) the A/S was finally increased after being voted on in 2010. Many here is dismiss the drilling timeline mentioned on the website, but you have to acknowledge that the change did take place.
Now all that is required is for the shares to change hands & for the deal to be announced.
I feel that it is important to also point out that the lower our price per share is at the time of the deal, the worse the deal will be for current shareholders (the more shares we will have to give for the well-bore(s).
It would certainly be to Mr. Lloyd's benefit to remain silent, driving SIOR's price per share down, this will ensure that he gets a much better deal when shares are assigned to Cactus Drilling (Dan Lloyd Jr.). I do not know the details of the deal, nor do I know his percentage of ownership of Cactus Drilling, but it could be in his benefit to even sell his personal shares in order to keep the price per share under a certain level unit the deal with Cactus is finalized (which may be illegal). It is safe to say that he has zero incentive to reach out to shareholders at the present.
Assuming this deal, or something like it does go through in the next few weeks or months, I believe that we will also see a major increase in the price per share. Once the deal is reached, it will be to all of out benefits (Mr. lloyd Jr. included) for SIOR to become current with the SEC & the start making regular press releases, but we will not see these events take place until the deal with Cactus is finalized.
This is my two cents, for what it is worth...
As for the linkage between SIOR and Cactus Drilling, the mods on the board were quick to note that Dan Jr was part of Cactus Drilling (the one with "over 50 rigs") and frequently made it a cornerstone of this board's DD.
Personally, I think MWM and I did a huge service to this board by pointing at the truth of this long standing mod assertion.
For example:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=72983568
geopressure
Wednesday, March 07, 2012 12:45:14 PM
Re: MU_Redskin1 post# 5244
Post # of 6378
I agree with much of what MU_Redskin1 has to say...
On the 25th of February, 2012, SIOR updated their website. Included in the updates was the line, “Superior is poised to commence new horizontal drilling as early 2012” being altered to read: “Superior will commence horizontal drilling in early to mid 2012”. I see this meager change, as small as it may seem to be of great importance, & I will try to explain why.
This is very, big news, despite the fact that it has nearly been discussed on this board. As far as we know, SIOR has no noteworthy cash available to pay for any horizontal drilling at this time. However, the A/S increase which was voted on in November of 2010 has just taken effect, so shares are available for dilution if SIOR management so chooses.
With drilling to take place within the next 6 months (early to mid 2012) how do we think that SIOR will fund these drilling operations? According to Sandridge, each horizontal, Mississippian Lime well-bore cost around $2 million $D, which is cheap compared to other resource plays, but rather costly if SIOR plans to pay for this via diluting on the open market.
[Scenario #1] If SIOR is able to fetch $0.01 per share, then full dilution would pay for only 2 well-bores - and we all know that the stock wouldn't stay in the $0.01 level for very long. I am not a finance expert, but I do not see dilution at the current rates as a reasonable means of obtaining drilling capital.
[Scenario #2] An alternative to diluting on the open market would be to assign shares to a drilling/completions contractor, in return for their services. Those who frequent this board will know that SIOR's CEO, Dan Lloyd Jr., is the majority interest holder in Cactus Drilling (the largest privately held drilling/completions contractor in North America). I propose that SIOR will place a portion of the now available shares with Cactus Drilling in exchange for one or more 'turnkey', Mississippi Lime well-bores.
Assuming that this scenario is correct, then it stands to reason that Dan Lloyd Jr. & the other Cactus Drilling Interest holders would want to get as many shares as possible for the well-bores. When SIOR's price per share started to increase around the 1st of this year, SIOR Management (also being Cactus Drilling's Management) decided that they had best get this deal moving ahead in high gear. Considering that the A/S increase was voted on in 2010, but not actually increased until March, 2012, indicates to me that the deal was at a standstill. Now that SIOR's stock has come alive, we have seen two important events transpire: 1) SIOR's statement on their website that was mentioned above & 2) the A/S was finally increased after being voted on in 2010. Many here is dismiss the drilling timeline mentioned on the website, but you have to acknowledge that the change did take place.
Now all that is required is for the shares to change hands & for the deal to be announced.
I feel that it is important to also point out that the lower our price per share is at the time of the deal, the worse the deal will be for current shareholders (the more shares we will have to give for the well-bore(s).
It would certainly be to Mr. Lloyd's benefit to remain silent, driving SIOR's price per share down, this will ensure that he gets a much better deal when shares are assigned to Cactus Drilling (Dan Lloyd Jr.). I do not know the details of the deal, nor do I know his percentage of ownership of Cactus Drilling, but it could be in his benefit to even sell his personal shares in order to keep the price per share under a certain level unit the deal with Cactus is finalized (which may be illegal). It is safe to say that he has zero incentive to reach out to shareholders at the present.
Assuming this deal, or something like it does go through in the next few weeks or months, I believe that we will also see a major increase in the price per share. Once the deal is reached, it will be to all of out benefits (Mr. lloyd Jr. included) for SIOR to become current with the SEC & the start making regular press releases, but we will not see these events take place until the deal with Cactus is finalized.
This is my two cents, for what it is worth...
Join the InvestorsHub Community
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
