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HDR - the epic story behind the hottest stock on t

  1. This is a fascinating newspaper article on the genesis of HDR. It was posted last year by jswood and might whet the appetite as we bide the time waiting for deepwater discovery(ies):


    Max de Vietri's fine Italian nose is finally out of harm's way after having doors slammed into it many times over the past five years while promoting the petroleum opportunities of offshore Mauritania.


    The 49-year-old mining and petroleum geologist can now afford to laugh at the rejections and put-downs he has suffered.
    On 16 May, Woodside Petroleum, in a joint venture with de Vietri's company Elixir, as well as Hardman Resources, Agip, Fusion Oil and Gas and Planet Oil, revealed that it had struck an 86-metre gross hydrocarbon column at the Chinguetti-1 wildcat probing the Khede prospect 80 kilometres off the Mauritanian coastline.
    Whether or not Khede finally delivers on its potential 180 million barrels of unrisked reserves is not too much of a concern for de Vietri as, more importantly, Woodside's $18 million wildcat is the first well to be drilled in Mauritania for close to a decade.
    Of the 11 wells drilled off Mauritania since 1968, a few of them had shows. Woodside has mapped 43 leads harbouring 5.77 billion barrels of unrisked oil reserves.
    Oil companies around the world are now fretting over why they passed up on this prospective west African state.
    "Mauritanians are poor but proud, honourable and loyal people," de Vietri says. "I'm sure they are mature enough to manage the step to an oil-producing country."
    De Vietri first set foot in the Islamic desert state in 1994 to evaluate its gold and diamond potential on behalf of several mining companies. His first meeting with the then-Director General of Mines and Energy M'Boye Ould Arafa was like a reunion of old friends.
    "Arafa was extremely hospitable and generous," de Vietri recounts. "He was so happy that somebody actually showed interest in (exploring) Mauritania."
    A year later, de Vietri brought in Ashton Mining, which picked up 180,000 square kilometres of mineral licences. Last September, the company proclaimed Mauritania's first fully-documented diamondiferous kimberlite discovery. One fateful day in 1995, de Vietri was having tea with Arafa at the Department of Mines and Energy in Nouakchott when the director general started wondering about his country's petroleum potential.
    De Vietri says: "He asked me, 'Why is it that our neighbours in the north and south have all these offshore oil discoveries but we have nothing? Max, can you get some people interested?'"
    De Vietri agreed and Arafa promptly granted him a one-year moratorium on the entire coastal basin. Armed with stacks of data and heaps of enthusiasm, de Vietri travelled to London, Paris, Frankfurt, Milan, Sydney and Perth to promote the acreage. That marked the start of a painful relationship between de Vietri's nose and people's doors.
    "The most common questions I got was 'Who are you?' and 'Where is Mauritania?'" de Vietri says with a chuckle.
    Although de Vietri is a trained petroleum geologist, his proclivity towards mining was widely interpreted as inexperience in oil and gas. The challenge was further compounded by the usual stereotypes people have about west Africa as corrupt, war-torn and bureaucratic.
    In fact, the Islamic Republic of Mauritania is one of the rare working democracies in Africa, populated by 2.3 million people living in relative harmony. Each working Mauritanian earns on average $500 a year.
    "I've never seen corruption in Mauritania and I've never had any problems," de Vietri says. "If you're right to people, people will be right to you."
    In particular, "Arafa is a guy who should be praised for promoting Mauritania. He was very accommodating even when I was unsuccessful", he says.
    De Vietri also refutes human rights reports of slavery in the country.
    "We need to understand the cultural differences," he explains. "What they have there is a master-servant relationship in which one is dependent on the other. There is no oppression."
    After close to a year of knocking on doors, de Vietri, through his mentor and Elixir chairman Brian Welch, finally met someone who showed an interest -- Ted Ellyard, managing director of Hardman.
    "Ted is a real businessman. He drives hard bargains but keeps his promises," de Vietri says.
    They flew to Mauritania together but were refused entry to the library of the Department of Mines and Energy by an over-zealous librarian.
    Embarrassed and angry, de Vietri barged past the stunned bureaucrat and started going through the reams of geological data. In the dark and dusty room, Ellyard's eyes lit up and right then de Vietri knew he had his first investor. From then on, de Vietri's nose had some good Aussie company in more door-slamming saga. In early 1998, they thought their efforts had paid off when Shell agreed to farm into their acreage. However, for reasons which remain unclear, the Anglo/Dutch major bailed out a day before they were scheduled to fly to Mauritania for a signing ceremony.
    "We were all crushed," de Vietri says.
    Eventually, Ellyard roped in Shell's Australian soul mate, Woodside. Later, de Vietri brought in Roc Oil under an option agreement with Elixir.
    Roc's chief executive John Doran said: "Max is one of the humblest, nicest guys you can ever meet in this business. While everyone is trying to claim credit for this Mauritania discovery, he remains silent." In fact, sources close to de Vietri say his easy-going ways are also his biggest flaw in business because people tend to take advantage of him.
    De Vietri attributes his tenacity and patience to his mother and father respectively, both 89 years old. His family migrated to New South Wales in 1962 and moved to Perth eight years ago.
    De Vietri is certainly no stranger to hard knocks, after having worked as a gardener in southern France and a "guts barrow boy" at an abattoir in Alice Springs.
    Now that the nose-busting times are over, de Vietri hopes to rekindle his passion in music and play in a blues band as a guitarist.
    His most ardent fans are his wife, Laurel, two sons and a daughter.

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