At least two reasons for the change. One – the PFC began rising. Two – the corporation completed the business combination with Texalta Petroleum Ltd. Under the transaction, PetroFrontier will acquire all of the outstanding shares of Texalta. Most probably, these two events are interrelated.
Which means that the successfully closed business combination has probably contributed to the run-up of the stock. Yesterday, PFC went 6.78% up. The trading volume was large too – more than 1.39M shares changed hands, well above the daily average. Unfortunately, the stock stays far from its peak of $4.41 set in early April. It is not clear whether the shares will be able to climb up to these high levels in the near future.
The solid financial condition of PetroFronties provides good enough reasons for us to anticipate a possible progress in the share price. In the end of 2010, the corporation had a working capital of $55M, which seems sufficient enough.
In addition, yesterday the company announced to have granted a total of 1.655M stock options to various officers, employees and directors. They are exercisable at a price of $3.05 per share.
The fore-mentioned Texalta deal will allow PetroFrontier to take control of exploration permits EP 103 and EP 104 in the Southern Georgina Basin in Australia. As the corporation claims, the latter represents “one of the last remaining virtually unexplored, hydrocarbon prospective, onshore sedimentary basins in the world.”
Only the future will show whether the acquisition of Texalta Petroleum will turn out to be a successful deal, or the company’s managers will be disappointed.
