PetroAmerica Oil In Colombia Breaks Out

Petroamerica (TSX:  PTA,  OTC:  PTAXF) - Breaks Out

Source:  http://www.stockhouse.com/News/CanadianReleasesDetail.aspx?n=8374484
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Outlook
With Balay-1 and Balay-2 continuing to produce on long-term test the Company is anticipating that it will continue to realize production revenues. Additionally, the Company and partners envisage finalizing the development plan for the Balay discovery, with approval for the first phase expected in the fourth quarter of 2011. Sanctioning of the second development phase will depend on the results of Balay-3 which should enable the joint venture to properly assess the size of the Balay oil discovery.

The Company plans to evaluate and appraise the Las Maracas discovery in 2012. This will include placing the discovery well on long-term test and the drilling of several appraisal wells. Subject to the outcome of the appraisal results, the Company and current partner are committed to fast tracking the development of this discovery. The Las Maracas discovery is viewed to be an extremely positive event for the Company.

The Company will continue its strategy of rationalising the portfolio to leverage some of its high working interest positions into more strategic and cost effective holdings. This strategy, which began with the relinquishment of the COR-12 and COR-14 Blocks early in 2011 and has continued with the sale of the VMM-3 block and equity changes in the El Eden block, is expected to enhance the Company's competitive position by allowing it to free up working capital, recover past costs and to enhance the risk/reward balance of its portfolio. The Company is also considering reducing its working interest positions in the LLA10, CPO1 and SSJN5 blocks.

Furthermore, the Company will participate in an extensive exploration program in 2012 with the drilling of seven exploratory wells targeting net mean unrisked prospective resources of 45 million barrels of oil equivalent ("BOE"). All of the prospects to be drilled in 2012 will be covered by 3D seismic, thereby significantly reducing the exploration risk.

Overall, the 2012 outlook for the Company is expected to be one of rising production and revenues, as the Balay development and Las Maracas appraisal programs get underway, and significant exploration upside exposure by way of a seven well drilling program.

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The Goombarh is holding warrants on this one.

PetroAmerica (PTA, PTAXF) - Moving Up

...Aug 31, 3011 seems to be moving a bit upwards...

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Goombarh Flash 30,  August 25, 2011

Bottom Fishing - Dragged up a Billion Share PetroAmerica (PTA, PTAXF)

Good Day,

Just too lazy to build the good case for investment by myself.  However, here in these write-ups in the Spring of this year, pumping the PetroAmerica stock, one gets a sense of the company:

Ahead of the Herd - Columbian Oil:

http://www.aheadoftheherd.com/Newsletter/Colombian%20Oil.pdf

James West in the Midas Letter:

http://www.midasletter.com/news/10011402-Petroamerica-leads-junior-oil-exploration-in-Colombia.php

An article by exclusiveReports:

http://www.newfuelnow.com/commentaries/2011/03/15/world-looks-to-colombia-for-oil-supply/

Short Article in Resource Investor

http://www.resourceinvestor.com/News/2010/3/Pages/Petroamerica-discovers-Colombian-oil.aspx

And a capsule summary of what's happening recently:

Petroamerica Oil Corp. (PTA-X0.140.0053.57%) has moved away from a year low of 12 cents on news it has received $2.8-million in oil revenue during the first six months of 2011 from its 15 per cent working interest in the Balay discovery of the LLanos Basin in Columbia. Since beginning long-term testing of the Balay discovery in July 2010, more than 420,000 barrels of oil with an average price of $105.91 a barrel and a per-barrel netback of $65.48. Two new test wells were started on long-term testing during the past week, producing a collective 6,561 barrels per day with negligible water under electro-submersible pump. The oil is being trucked by road although Petroamerica and its partners are now evaluating the logistics needed to transport those quantities of oil.

http://www.theglobeandmail.com/globe-investor/investment-ideas/small-caps/todays-small-cap-stocks-to-watch/article2112873/page2/

Link to their corporate presentation:  http://www.petroamericaoilcorp.com/main/includes/media/pdf/2011-06-15_PTA%20Presentation.pdf

What are the key differences in PetroAmerica now and in the spring, well, there is the stock price for one, as in the chart following:

The stock price is now at the lowest point that it has ever been.

Another is that there was a management ruckus and changeover, where PTA undertook too much and too ambitious a program that their finances could not support, and they have divested out of some projects.

Also, a key alliance with Pacific Rubiales Energy with Pantin on the BOD may now be finished.

And the final factor is the severe dilution with financing in June, 2011 with 150 million shares now giving a 330 million share total and possibly 900 million fully diluted with all the warrants being exercise.

Is the situation that bad?  IMHO, no, the management is key, and they appear hard at work in creating value for the shareholders.  PetroAmerica still have relationships with Talisman Energy and Petrobras.  Their Balay wells are producing and they are expecting news from their Marracus drilling.

So, the Goombarh has taken a position in this bottom fish, with the anticipation of good news coming and the eventual rise in the fall with oil prices moving back higher.

Until next time,

Marco G.

http://goombarhsedge.blogspot.com/

http://seekingalpha.com/author/marco-g/articles