Pumpers Cut the Cord for Nostra Energy Inc. (OTC:NORX)
Yesterday Nostra Energy Inc. (OTC:NORX) dropped 10% on heavily faded volume. Promoters who touted the company have gone silent, with no new emails coming through yesterday.
The pumping for NORX started April 1 and it was definitely no joke, judging by the compensations promoters disclosed, reaching up to $100 thousand. Pumpers The Stock Scout and Penny Stock Circle who bagged $50 thousand sent their last alert for NORX on Wednesday. Sensing that this one won’t run the way they had expected, the promoters came up with a half-hearted excuse, touting the supposed ‘stability’ of the pick and announcing a new one is coming soon. NORX was anything but stable yesterday, dropping in double digits and logging a second red day, left without promotional support.
We covered the pump when it started, but it’s worth repeating some of the more unsettling details about it. In mid-March NORX signed a farmout agreement with Summit West Oil, LLC, which should transfer working interest in the property to NORX once they fulfill certain provisions. The trouble with this otherwise lucrative-sounding plan is that NORX may be facing an uphill battle.
The company will need to finalize exploration studies and data processing for the property in question, then transfer $200 thousand to West Oil by the end of this month. This is to be followed by NORX drilling one horizontal well by the end of 2013 and two more by the end of 2014, each well estimated to cost about $5 million to drill, whose completion would lead to the transfer of working interest.
Sadly, NORX doesn’t exactly seem able to deliver on those fronts, considering its financial situation as of its last report dated November 2012:
$8 thousand in cash
zero revenues (company in exploration stage)
$20 thousand net loss
The company did secure $100 thousand through a convertible note in February, which still leaves it several million short of drilling the first of three wells.
The promotional effort for NORX pushed it through two volatile days and the stock is now a little below its pre-promotional levels, despite the pumper promises for ‘stability’. It’s no wonder the pump didn’t hold out, considering the track record of promoter The Stock Scout. The same outfit participated in a short-lived pump fiasco for Primco Management, Inc. (OTC:PMCM) in early February. PMCM‘s chart speaks for itself.
With NORX thrown off-balance by the promotion, no new pump mails coming through and with a seemingly impossible undertaking before them, the company’s success is anything but certain.
