The tiny Irish stock on the brink of landing 'the first' post-sanction oil deal in Iraq. Ref 'Fleet Street Letter' 12-04-04..

Morning all,(afternoon Tokyo,how you doing ?)

Just a thought,with this meeting going on in Amman,some of the talks must be about Block 6 because they have a JV with jordan, and the samples they are analysing have been taken from the Jordanian side (because of the danger in the western desert).Also some of the Iraqi`s who were in Ireland were on the geological side of things, so not only are they discussing the contracts, but sorting the rights to Block 6.In the annual report PET said they were planning to drill a 5000m or ft. well when safe.
so to me it`s looking better and better.
all IMO.
regards,
Dexter

Morning Dexter (although you are correct 4.50pm here) Doing well thanks, but the excitment of PET is killing me, I reckon and am hoping for an RNS by Monday, although anytime before that will do just fine!!!

Yesterdays post on another BB about the Market Makers is very relevant to this mornings activities, be interesting to see what other tactics they pull out to try and get our shares before the RNS is released, although if the MM's are reading this I have a sure fire way, just put the bid up to 4-5 pounds and you'll scare some out of ME!

here is the post made interesting reading

Tokyo

MARKET MAKER SPEAKS OUT: Ways of a Market Maker

I was an OTC MM for about 10 years ending in the late 80's. Since then I have been strictly an investor. Since I have not been that up to date in MM rules I will only make statements that I feel fairly confident are still accurate regarding these activities. By and large most MM don't have a clue nor do they care to learn, about the fundamentals of the stocks they trade.

They just try to make orderly markets. When dealing with BB stocks it is very easy for a MM to get trapped into being short in dealing in a fast moving market. Reason being; most of the MM's in this stock are what are called "wholesalers" this means they don't have retail brokers "working" the stocks.

So they have to rely on what's known as the "call" from larger retail houses. If a "Big" retail firm like an E-trade calls up a market maker to purchase say 5,000 shares of a stock, they expect to get an "execution" from that market maker. If he turns them down, or only gives a partial then the "Big" firm will go to another MM.

If this second MM "fills the order" then that "Big" firm has a moral obligation to continue to give future "business" in that stock to that MM who performed (his life blood). This will go on until he "fails" to perform and so on.

Contrary to popular opinion the "Big" firms Do NOT neccessarily go to the "Low Offer" to fill a buy order (Or high bid for a sell). They "Go" to who they think will perform to fill the order and expect that MM to "match" the "low offer" in the case of a buy (bid in the case of a sell). Even though this MM might in fact be the "high bid" and not really want to sell any more.

As a wholesaler he must perform or he will get a reputation as a "non-performer" with the "Big" houses and will cease getting "calls" which means he will soon go out of business. I mentioned above that this activity is very significant to BB stocks. I say this because most of the trades in these BB stocks are "unsolicited" and are done through discount houses.

With the above groundwork laid, let me try to explain how market makers get short even if they like the Company; Lets say that a stock (shell) has been lying quietly at $.25 bid $.50 offered. A limit order comes into one of the MM's to Buy at $.50 for a thousand shares. Prior to this trade that MM may be "flat" (neither long or short any shares). He fills the order and is now short 1,000 shares. He may raise his bid hoping to find a seller to "flatten" out his position. But before he realizes it a wave of buyers have come in and cleared out all the $.50 offers. Now the stock is $.50 bid .75 offered. Here comes that "Big" firm he just sold the 1,000 shares to at .50 with another bid for 1000 at .75. He makes this print. Now he is short 2,000 at an average of .625. The market keeps moving and now its .75 bid 1.00 offered. Now he has to make a decision.

Just like investors, MM Hate to take a loss. So 9 times out of 10 he will now sell 2000 at 1.00 making him short 4000 but with an average .81. At this time he would love to see a seller at .75 so he can cover his short and make a few bucks.

But instead the market keeps moving up. Now it is 1.00 to 1.25 and here comes the buyer again at 1.25. He doesn't want to lose the call so now he needs to sell 4,000 at 1.25 to keep his break even point above the bid. Now he is short 8,000. Market moves up to 1.25 bid 1.50 offer here comes the buyer now he feels he must sell 8000 here because "stocks don't go up forever".

Now he is short 16,000. And so on and so on. If the stock keeps moving up, before he realizes it he could be short 50k or 100k shares (depending how big his bank is).

Finally the market closes for the day and on paper he may look all right in that his "break even" price may be around the closing price. But now he has to figure out how to entice sellers so he can cover this short. It is important to note that if this happened to one MM it has probably happened to most all of them.

Some ways MM's entice sellers; Run the stock up with a "tight spread" in a fast market, then "open" up the spread to slow down the buying interest. After it has "cooled off" for a little while lower the offer below the last trade right after a small piece trades on the offer then tighten the spread so that the sellers feel they can take a "quick profit" by "hitting the bid" on the tight spread.

Once the selling starts the MM's will walk it down quickly by only making small prints on the way down with the tight spread. Another way is by running the stock up in the morning, averaging up their short then use the above technique to walk it down in the afternoon.

Hopefully after doing this for several days, it will demoralize the buyers. The volume will dry up and the sellers will materialize thinking that the game is over.

Contrary to popular opinion, MM usually Do Not Cover in Fast moving markets either Up or Down if they are short. They Short More. They usually try to cover after the frenzy is out of the market. There are many other techniques they use but the above are the most popular.

This technique works about 9 times out of 10 particularly in a BB market. However that is because 9 out of 10 BB stocks are BS. Remember what I said above. Most MM's don't have a clue as to the value of a Company until they get trapped. If the Company has solid fundementals and a bright future. Then the stock will do very well. And the activity that caused the situation will prove to even help the future stock activity because it created an audience."

a valuable insight, tokyo.

Many thanks

I got this back from PET,to me it means something is about to happen, otherwise why not comment on at least the point about sampling in Jordan


Roger we cannot comment.

-----Original Message-----
From: petrel@hub03.mail.esat.net [mailto:petrel@hub03.mail.esat.net] On
Behalf Of ***********@btopenworld.com
Sent: 20 October 2004 09:13
To: petrel@iol.ie; *************@btopenworld.com
Subject: Contact Petrel Resources : contract talks

Name -***************
Message :
Dear sir/madam,
I have a few points that i would like you clarify if
possible please.

1) Is it correct that you have a team in Amman at the moment?

2) If so are you still meeting with the Iraqi people that were in Dublin
the last 2 weeks ?
3) The exploration you have been doing in the western desert, is that
risk sharing with the Iraqi ministry,and do you still plan to drill a
well,as stated in your annual report ?
4) the JV that you have with the Jordanians,is that just for sam pling
or full exploration in Jordan ?
5) If you are meeting with the Iraqi people,is this for the contracts to
develope the oilfields, if so, is this still a cash contract or will it
be converted to risk sharing ?

Many thanks for your time,
regards,
*************

Wide (ish)spread and very light trading so far today. Seems we are all waiting for that info to come thru.

Certainly does feel like the end is near on this one, a few more days perhaps and most of us on this thread will be a lot richer than before.

Tokyo

Everythings crossed!

Dexter, I am sure you will find it price sensitive information, but never mind, Good Try. z Ps See more buyers than sellers are willing to accept the risk

Again, they are trying to push the offer price lower, panic tactics, perhaps, to snatch some more shares at a lower price before offering them onward.

Just had my last top-up,`til next time anyway!!!!!!!!.
Ziblot,they did`nt even answer a question to which the answer is in the annual report!,so something is going to happen IMO.
goodnight all,
Dexter

Petrel Resources PLC
20 October 2004




Petrel Resources announces that it received confirmation on 19 October 2004 that funds managed by Gartmore Investment Management plc are now interested in 2,706,881 ordinary shares in the Company, representing approximately 4.53% of the issued share capital of the Company.


This information is provided by RNS
The company news service from the London Stock Exchange

gra1969 - read my post from this morning on MM scare tactics it pretty much mirrored what happened today

Hi Pets....I see that Gartmore have just announced a major investment of 2 and 3/4 million shares in Petrel, so they obviously think there is some good news around the corner...be lucky guys...piston broke

Guys if you go though the old RNS announcements you will see that at one point Gartmore held 4,000,000 shares in PET, over the last year or so they have sold off a few to lock in profit (as any fund management company has to), I'm afraid today's RNS was not reporting a buy, but a sell, although as Gartmore have been selling chucks off at regular intervals there doesn't seem like anything to be worried about, they still hold a pretty impressive stake in PET, I would however start to worry if they released another RNS tomorrow to say they had dumped another 570k, but as they know about as much as we do, I still feel that nothing has changed and the next RNS we read will be the one we have all been waiting for, and then here comes 4 pounds+


IMHO

Tokyo

large 50,000 buy reported after close, they had to pay outside the offer price for it as well

Hi all, found this on BBC.

------------------------------------------------------------------------------

Iraqi oil experts visit Aberdeen


Oil production in Iraq has been stagnant for years
A high-powered delegation from the oil ministry in Iraq is spending a week in Aberdeen.
A group of the country's top engineers, geologists and geophysicists are keen to learn how their industry can benefit from North Sea expertise.

The visit - the first of its kind to the UK since the fall of Saddam Hussein - was arranged through Blackwatch Petroleum Services.

The oil and gas consultancy has offices in Aberdeenshire.

The company's deputy managing director is an Iraqi.

The visitors from Iraq's state-owned Oil Exploration Company are keen to learn as much as possible about advances in computer software and technology.

They say oil production in Iraq has been stagnant for years and are keen to catch up.

They have acknowledged that the security situation will deter many companies from investing in their country.

However, they said UK firms could still become involved without sending staff to Iraq because so much of the exploration work is computer-based.


http://news.bbc.co.uk/1/hi/scotland/3757392.stm


wilbs

Tokyo, referred to your post again,thanks. Seems like we had all better keep our nerve and not get the jitters. Im convinced that this will rocket soon despite all the 'tree shaking'.

I think the consensus among holders is for an RNS on Monday

Bring on monday morning in that case. Where did you glean that info Tokyo?

Tokyo: I do not think we can read anything one way or another into the fact that PET had no comment to the recent enquiry. The person left behind to man the Office was probably left with one instruction to outside requests for information...don't say anything! I also believe that we will hear something when there is something positive to say...but these sort of agreements by their nature are complex...so we may hear something today or next week. If we are keeping close tabs on where PET executives are...waht about the flight manifests?

Other posts seem to suggest that the Iraqi Oil Ministry is in a real hurry to extract the 'Black Gold' from the sand. I await developments with keen interest. How much confidence do we have to increase holdings at these price levels?