Yesterday, OriginOil’s stock entered the market with a mighty price and volume increase. Nearly 3.7 million shares were traded, or almost 18 times the average, and the price jumped another 23.53% up to close at $0.21 for a share.
A press release announcing the first revenue event for OriginOil caused the turmoil on the market. A first purchase order for OriginOil’s Quantum Fracturing System as the first unit in a multi-phase commercialization program by an unknown Australian customer was announced. A payment has supposedly also been received, and further payments for further deliverable units were also expected. There is no reliable confirmation for that milestone event, like a SEC filing for example.
Though, it is questionable if the voluminous OOIL trading could have happened without the contribution of several stock promoters, which distributed broadly the still highly doubtful news to their newsletter subscribers. OriginOil’s business model to create a technology that can produce bio-fuel from algae and then license the technology to another company looks promising, and popular among traders as well.
Though, according to the last 10-Q the business is still in the start-up phase and the technology is not patented yet. Thus, without a single dollar revenue so far and without enough cash to cover the operating expenses over the next three months, the company is in a dire financial condition.
Under such circumstances it sounds pretty reasonable that some advertising will be done for the stock as well. One of yesterday’s promoters discloses to have previously received $80,000 directly from the company and 191,000, currently free trading shares of OOIL stock, to promote that same stock.
Currently, the promoter is being compensated with 1 million restricted shares under rule 144 shares, which he intends to sell immediately when they become available for trading.
