Using the Shorts

[davidhmtk]

I believe IOC has a plan to take advantage of the artificially low share price.  A $500M debt offering will be underwritten by selldown partners and used to buyback shares.  With the selldown extending into 237, there will be plenty of cash for lots of drilling.  Might as well take advantage of this investment opportunity graciously provided by the shorts.  (The $500m is per WA @ IPAA).

[CesiumFormate]

I don't think they will get many shares cheap. As soon as they announce a buy back the stock will sky rocket.

[johnwgrant]

I don't think they will get many shares cheap. As soon as they announce a buy back the stock will sky rocket.

That's the beauty of announcing a share buyback - just the news of the buyback will cause the shorts tremendous pain !!!

Go IOC  -- and please hurry

[Dr. Wu]

I don't think they will get many shares cheap. As soon as they announce a buy back the stock will sky rocket.

Arrange a revolving facility, announce a 10% buyback and draw as necessary.  With 11 mil shares short, the threat is as good as the act..

[Gator]

Cart. Horse. Get a deal done, then talk about buy backs, stock splits, and dividends.

[davidhmtk]

Cart. Horse. Get a deal done, then talk about buy backs, stock splits, and dividends.

Reporting what I heard & inferred from Monday's talk.  Didn't get sense of timing from listening to WA, but cart-before-horse-wise, if IOC is strategically committed to regaining % ownership of resources, does it make sense to buy before or after sell-down announcement?  I would let short skepticism keep the cost down for a few days of serious buying, then announce.

[tarulestheday]

I believe IOC has a plan to take advantage of the artificially low share price.  A $500M debt offering will be underwritten by selldown partners and used to buyback shares.  With the selldown extending into 237, there will be plenty of cash for lots of drilling.  Might as well take advantage of this investment opportunity graciously provided by the shorts.  (The $500m is per WA @ IPAA).

Love the idea and concept but just announcing a share buyback will not be a remedy for the shorts and the low valuation. Many companies announce a buyback but few of them actually buy the shares. This will not scare the shorts into covering. What will is actual buybacks and "retiring" those shares from the float.  Do that relentlessly in large quantities and it will be like killing the shorts by slowly sucking the air out of the room.

Use or flush.

[Gator]

With 13.7 million shares short betting (praying) that “a deal has never been done therefore a deal will never be done” will take care of this low share price once it is announced. I have heard that enough cash up front will take care of the shorts.

[davidhmtk]

With 13.7 million shares short betting (praying) that “a deal has never been done therefore a deal will never be done” will take care of this low share price once it is announced. I have heard that enough cash up front will take care of the shorts.

It looks to me that IOC is selling more of the resources than it needs to fund drilling & production, as directed by the PNG gov't's needs.  I bet Phil isn't thrilled if he has to sell a decent chunk of 237 as well as PRL15.   So use the short's skepticism against them - they will stay & fight a debt issuance/stock buyback, even if it is announced with a disclaimer "IOC expects to close it's asset sale in the near future."  Let the shorts stubborness subsidise the buyback, then announce.

[Libtardius Maximus]

Just for the sake of argument, I do not recall chatter about share buyback yet I recall comments about divs and stock split, specifically from Aug cc by CV. In cut and paste form.

Collin Francis Visaggio - Chief Financial Officer
Thanks, Phil, and welcome to everyone listening to today's presentation. Just a few opening remarks. We continue to progress and expand on our Gulf LNG project to monetize the existing resources, and we also continue to invest in our exploration portfolio for the future. We had completed another milestone on the Triceratops discovery monetization, with the signing of the farm-in agreement with Pacific Rubiales Energy, which Phil just highlighted.

Completion of the agreement in the next few months, in addition to the debt financing proposed, will increase our cash position and fund our near-term accelerated drilling plans. The assets sell down will fund our Gulf LNG Project and our longer-term accelerated exploration program. Once this sell down is concluded, we will consider our optimal capital structure and potentially return funds in excess of our requirements to shareholders. Additionally, we will consider creating trading liquidity through a stock split.