From a Stockh. poster.

The approval of Algar is certainly very positive but the positive effect on cash-flow and profit is still a long ways off, into 2010 by the company's estimate. Therefore, the shorts won't see any need to hurry to cover. That said, Connacher has now demonstrated to the Big Boys that they will do what they say. They said they would build Pod 1 and produce 10k bbls/day. They said they would get approval for Pod 2. This is the hallmark of competent management. Say what you're going to do and then do it to everyone's satisfaction. Today's announcement dramatically enhances management's credibility in the industry.

Few observers now doubt that Connacher will be producing 20k barrels/day from the oil sands. Based on this past performance, most reasonable observers will take as given that the management has the ability to carry their plan right through their stated intention of becoming a 50k bbl/day producer.

The only concern the shorts have at present is 1) there are a lot of companies interested in becoming oilsands players, 2) many of those companies could buy Connacher out of petty cash, and 3) the people, resources and technology are already in place to make for a successful take-over and integration.

One news release away from a short's nightmare as I see it.

"The Upshot: Occidental is paying $492 million for theJoslyn stake. Industry analysts lauded the move, for it gives thecompany a footprint in one of the biggest developing oil plays in theworld. The project is still in the exploratory stage, but Occidentalexpects net recoverable reserves of about 370 million barrels.Production is scheduled to begin in 2014, after which Occidentalexpects to net about 11,000 barrels of oil per day, eventually growingto approximately 31,000 barrels per day."

http://industry.bnet.com/energy/1000...

So Occidental is investing essentially $500 million for and initial 11k bbl/day of production which is projected to grow to 31k bbl/day and this project is not currently producing and is still only in the preliminary planning stages.

If they made the same offer to CLL, this would still equate to about $2.40 a share or about a 40% premium to today's price. If they paid the going rate for production then an offer of $7 - $8 a share would be far more likely.