Sound Oil (LON: SOU) Einstein’s Equation….


It's logic. They're going up.

It’s logic. They’re going up.

As promised we’ve tried to keep sourcing info’ on some of the Companies that we’ve had fantastic gains on over the last few months etc. Next up Sound Oil (LON: SOU).

At the moment it looks like the SOU sp is in a holding pattern. No real movement either way at 12p ish. September could be a busy month for the Company. It’s been bandied around online that the CEO has been on his holidays and is now back progressing the Company. There’s plenty going on in the business behind the scenes, what with Nervesa approvals, Niche farm in, Badile farm in & whispers of Laura farm-in etc. We do know that, regardless of what SOU refuse to confirm or deny, that they are in talks with at least 2 Major oilers, on farm-in & potential takeover should they come up trumps on Nervesa, Badile, Laura etc.

I did actually hear that some form of ‘chat’ with Rockhopper Exploration (LON: RKH) may have gone on a few weeks ago. How true this is? I’d say 50/50.  Recent news has included, the Badile land purchase & long lead items, Nervesa long lead items & well head purchase, Letter of intent with Drillmec Spa for the exclusive use of an AHEAD 375 Drilling Rig in Italy for both the SMG and Laura wells, and first gas at Casa Tiberi. This points to a Company going in the right direction.

Take a good look at the Einstein Equation pictorial. Therein lies the answer to the question we are all asking; ‘How high can they go on more positive news?’ It really is a question of perception for each individual investor. We know that Takeovers or farm-ins of Companies with world class assets, always come at a premium to the current share-price.  There are many different schools of thought. Takeover; 60p, 100p, 40p, 50p, Farm-Ins; 25p 20p, 30p, 18p. One thing is very likely, they are going up towards 20p this year.

Do not be fooled for 1 minute by the Company line; ‘The aim is to make Sound Oil a footsie 250 Company’ This will never happen. They will, subject to continued success, be swallowed up.

Logic should dictate your move here. Hold for Farm-In & or Takeover News in 2014.






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