Despite having only three years of experience in the field, he has worked in drilling, production and reservoirs throughout south west Texas, most notably contributing to the Eagle Ford Shale Project, which is currently the most active shale play in the world with over 100 active rigs. We have an over 80% success rate, see our reports at whitediamondresearch.com. . This is just a rough estimate based on the latest information I found, but if accurate it still points to Metamaterial's shares being significantly cheaper than Torchlight's shares if one wanted to invest in the new company. In November 2007, Mr. Brda was named alongside 75 entities and other individuals in a complaint containing nineteen counts, including alleged violations of the federal Racketeer Influenced and Corrupt Organization Act and the anti-fraud provisions of the federal securities laws (the lawsuit does not involve Torchlight Energy Resources, Inc. in any way). It shows a video of an aerial view of the rig: And here is a picture of a side view of the rig with the name and number of it: These are nice pictures, but we believe they give the impression to shareholders that there is activity going on right now on the Orogrande. Any Yes No Irrigated? If you have an ad-blocker enabled you may be blocked from proceeding. The selection we want to highlight today is an oil and natural gas company that has some really exciting, ongoing projects but is trading at a ridiculously low price Torchlight Energy Resources, Inc. (NASDAQ:TRCH). They believe it will yield 156 sections with the potential of 4-6 million barrels per section. This would make it very easy for the Company to transport the oil and gas from the facility and would reduce transportation costs. February 27, 2020. Oil & Gas Explorer Proves Up Exciting Measured Oil and Gas Production from Orogrande Basin Project. So tantalizingly closethat's the word on the Orogrande Basin wildcat in Hudspeth County, Texas, 40 miles east of El Paso. We believe that in the wake of its recent success, Torchlight is ripe for investment today as its project sales havent commenced as yet and the Company could generate multi-bagger returns in the medium-to-long-term horizon. Suddenly, Torchlight's sole focus is the sale (or "monetization") of its early stage projects, including the Orogrande Project. This info is straight from https://www.torchlightenergy.com/current-projects/orogrande-basin, https://www.torchlightenergy.com/current-projects/orogrande-basin. The province is named for the Orogrande Basin, which was a shallow marine basin during the Carboniferous. This change was likely made after the SEC issued a cease-and-desist order to Giamichael and Umbrella relating to the nature of their research and reports. Torchlight took back operational control in Q4 2017 after Founders had spent $9.5 million to gain a 9.5% working interest in the project. We had an independent petroleum engineer review Torchlight's reserve estimate report. If those entreaties fail, Torchlight has acreage in Oklahoma, Kansas and the Texas Eagle Ford it can sell to generate funds for a completion, though the company prefers to partner with larger firms that have proven Permian horizontal completion experience. I wrote this article myself, and it expresses my own opinions. Torchlight offers 168,000 contiguous acres in the heart of the Orogrande and has executed a five-year drilling lease with a second five-year option with the state of Texas University Land System. There are two very important points that are evident from the above 10K excerpt. Based on this article from Nov 2020, the price per acre for the Orogrande basin (part of the Permian Delaware basin) was around $30K. Such efforts by the management to improve the efficiency of extraction will go a long way in reducing the indirect costs and improving the profitability and shareholder value in the long term. Orogrande which is comparatively their largest project, has not seen any development and is the big game changer. Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (10.72% of the property will not be operated on.) This high desert ranch country is punctuated by volcanic intrusions and uplifts that give it a distinctly western landscape. Shares even hit the $2 target on . Add up the value of all the parcels you want to include in your average, if there's more than one. !, 21.3 acres in Fabens, Texas offered at $200. Torchlight Energy Resources Inc. ( Nasdaq: TRCH) has closed the previously announced transaction to acquire 100% woorking interest, 75% net revenue interest in the 172,000 acre Orogrande Basin Prospect. Until recently, Torchlight's auditor was Calvetti Ferguson P.C. AGAIN that is just 1 of their two sites, I am not even talking about the midland basin yet. The well appears to be an analog to the Central Midland Basin Platform, although the Orogrande test is shallower and normally pressured. Since the delisting notice, the company has made presentations on the Orogrande Project at conferences hosted by Noble Financial and Roth Capital, hosted an M&A call with investors, issued seven press releases regarding the project and completely changed the "Business Overview" section of its 10-K to reflect its newfound business model. Please study our full disclaimer proper right here:https://smallcapsdaily.com/disclaimer/. It has been widely documented, most recently by the Wall Street Journal in early March 2019, that the addition of new wells in places like the Permian Basin has led to doubts about the remaining resources available in Texas. Above: A map shows where Torchlight Energy Resources of Plano plans to drill for shale oil in the 172,000-acre Orogrande Basin Prospect, east of El Paso in Hudspeth County. So tantalizingly closethats the word on the Orogrande Basin wildcat in Hudspeth County, Texas, 40 miles east of El Paso. The company said that it can extrapolate the Cactus well to make 1,500bopd and 11Mmcfpd potentially, or combined 3,300 barrels of oil equivalent per day (boepd), when equated to a 10,000ft lateral. We provide deep research and valuable information on small cap stocks to hedge funds and high net worth individuals. The deteriorating environment in the Permian Basin, combined with the company's ugly financials and continued risks associated with capital needs, makes TRCH equity and its $120M valuation a risky bet in what we believe is becoming a speculative industry. The average price of land listings and ranches for sale here is $96,515. The Delaware Sub-basin encompasses the Hobbs area of southeastern New Mexico and four counties of West Texas. The funds were used for the expansive drilling at Orogrande Basin. As a result of the sudden progress and M&A hopes, Torchlight's stock has appreciated 200% year-to-date, closing at $1.59 per share on April 23, 2019. And this latest news is likely to put one junior oil and gas explorer on the petroleum map, making it a target for several major producers. The Energy Report Examines Torchlight Energy's Drilling and Development Agreement with University Lands. . Such efforts by the management to improve the efficiency of extraction will go a long way in reducing the indirect costs and improving the profitability and shareholder value in the long term. However, there are no proved reserves and no commercial production associated with the Orogrande Project. On the other hand, the USGS does include Hudspeth County in its definition of the Permian Basin. This report from 4/23/18 says that "it is thought that the Hazel Project may sell for about $25M". Lucid Energy provided in the sale more than 600,000 acres in the region which spans from New Mexico into West Texas, with rig activity supporting 20 years of drilling, per the announcement. Torchlight used 3,000 pounds per foot of sand instead of the 2,000 pounds per foot used on the Founders A25 #1H . It doesnt end here. Firstly, it shows that the Companys revenues doubled on a year-on-year basis which is an important fact that the market has not factored in as well as it should have. . Prices for top E&P stocks and commodities. The Energy Report. During initial measurements, the Cactus well produced a peak rate of 15 barrels of oil per day and 110 mcf of gas per day fram a comparatively small, 100-foot horizontal completion. For more information, please see our When you consider, on top of that, the fact that Torchlight sports a management team inclusive of a CEO who was once a defendant in a federal RICO case, a CFO whose prior company was charged with running a pump-and-dump scheme, an investor relations consultant once charged by the SEC, and auditors who have settled litigation relating to filing falsified financials, we believe shorting TRCH is a no-brainer. Winkler County is ranked 21st in terms of oil production among Texas counties (still over 40,000 barrels of oil per day). Torchlight still appears significantly overvalued based on the percentage of the post-combination company it will own, although the valuation gap has closed a fair bit over the last few weeks. All rights reserved. Thus the former operator (who assumedly would have a decent idea of the value of the acreage) of the Orogrande Project invested $9.5 million in the project, but ended up selling its stake for $2.5 million. Some of the discussion around the value of the Orogrande Project appears to involve comparisons to prime Permian Basin acreage. Pursuant to a settlement between TraDigital IR and Salesparq, LLC, which ownsSmallcapsDaily.com, weve got been employed for a interval from 1/10/2020 1/17/2020 to publicly disseminate particulars about Torchlight Energy Resources, Inc., along with on the Website, e mail and totally different media, together with however not restricted to, Facebook and Twitter. Subscribe to get unmatched coverage of the oil and gas industrys entire landscape. I have no business relationship with any company whose stock is mentioned in this article. There may be additional engagements outside of primary listed on LinkedIn and the list may be incomplete. Certainly much less value than what some social media posts estimate. Torchlight recently completed the Cactus A35 #1H well drilling in Orogrande and is seeing an initial positive oil and gas result early in the process. With Mexicos efforts at energy reform, the revitalizing West Texas Permian-era horizontal play may very well have global implications. However, more tellingly, the cost per acre nearly halved with the median metric value declining from $20,449/acre in the July-October 2020 transactions to $10,482/acre in the post-October transactions. There are laws that keep them from lying, that's why they call them 'possible', but when it comes to rocks a mile under the ground, it's easy to say you see things that are promising. 21.3 Acres W/ Mineral Rights! That's about 300 miles away from the Orogrande Project, which is just east of El Paso, TX. In April, closely held DoublePoint Energy sold to Pioneer . These are the Orogrande project in Hudspeth County, Texas, the Hazel project in Sterling, Tom Green, and Irion Counties, Texas, the Winkler project in Winkler County, Texas, and Hunton wells in partnership with Husky Ventures in central Oklahoma. latest information I found, but if accurate it still points to Metamaterial's shares being significantly cheaper than Torchlight's shares if one wanted to invest in the new company. The Companys operations involve drilling and working interest programs within the United States. A searchable database of oil and gas debt and equity offerings. That rig was there on the Orogrande in early 2018. On June 12, 2018, Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas against Briggs & Veselka. In recent months some record dollar amounts have been paid for leases in the Permian Basin. Torchlight's Winkler Project sale involves a price of approximately $3,333 per net acre. Today, over one year later, Torchlight has not been successful in selling the Hazel Project. . In the Permian . This report is a good example. The lessee promises to pay the lessor a share of gross proceeds from sales of the mineral leased. New technologies, such as diverting agents, microfracturing, coil-tipping fracks, and digitalization can increase production in the Permian. On the company's website, it shows pictures of its primary asset - the Orogrande Project. Orogrande Basin Update. Several months later, Mr. Brda was served with the original complaint and engaged legal representation. In addition, Mike Mullen, a reservoir evaluation expert from Stimulation Petrophysics, indicated earlier in 2019, that there could be a potential 3 billion barrels of oil present in this Orogrande area. Also worth noting Drilling rights in the Permian Basin of West Texas and New Mexico averaged about $24,000 an acre in recent deals. TRCH only paid $3.35M in cash and stock for 75% of the Orogrande in August 2014 when oil prices were much higher than today. Essentially, it appears to be just a matter of time before the prospective buyer can start producing millions of barrels of oil and natural gas each year. For example, one Torchlight share is currently $2.29 USD (perhaps $2.08 USD net of the value of its oil and gas properties as discussed below). A Texas General Land Office lease auction in April 2011 brought a bid of $3,264 per acre for 30,000 acres, compared with an average bid of $906 per acre six months earlier. Wed, 09/24/2014 - 08:59 AM. Despite that, the prices of some shale plays has held up, the Houston Chronicle reported. ROTH rates the company a Buy. . Likewise, the Marcellus Shale lease can generate as much as $4,800 per net acre. with many not being able to survive the fallout. Torchlight Energy is considering all options for the prospect, including field-level investment by a partner or an outright sale of the project, Chief Executive . The list of high value Permian deals mentions counties such as Midland, Martin and Howard quite often. He pointed to Pioneer's $7.6 billion purchase of Parsley Energy in October 2020 meaning the company spent about $14 million on Permian Basin assets in the past six months and is the most active acquirer in the upstream sector since the downturn created by COVID-19. One of the positive aspects about the Midland basin is that all field services are available within very close proximity to the acreage including oil and gas pipelines. The Hazel Project is located in Irion, Sterling and Tom Green counties. As time passes by, land value around Los Lunas will likely skyrocket. If you do the math on that it lands somewhere around $750m barrels total. Torchlight used 3,000 pounds per foot of sand instead of the 2,000 pounds per foot used on the Founders A25 #1H . Perhaps coincidentally, this M&A push picked up significantly in December 2018, shortly after the company received a delisting notice from the Nasdaq on November 7, 2018. One Metamaterial share is around $3.00 USD and that gets you 3.3 Torchlight shares (around $0.91 USD per Torchlight share). "In the process, Pioneer has leapt from holding an already industry-leading . Torchlights Midland basin project is its second largest project with approximately 12,000 gross acres of area that will almost entirely be operated. In recent years, many such companies have hired stock promoters to tout their shares on stock-picking websites and through mass-mailed e-mail messages (commonly known as "spam"). The promoter is often compensated in the form of purportedly unrestricted shares of the company's common stock, which the promoter sells after its touting has attracted investor interest in the company. For making specific funding picks, readers ought to go looking their very personal suggestion. 543 Acres M/L bordering over 25,000 Acres of Santa Fe National Forest. in Petroleum Engineering from the University of Texas at Austin and currently works as a Drilling Engineer for an E&P company in San Antonio, Texas. We specialize in the technology and healthcare sectors. ROTH has a Buy rating and a $1.75 per share price target on Torchlight, whose share price is currently $1.17. Reddit and its partners use cookies and similar technologies to provide you with a better experience. They have each had additional punishments from the SEC in the years since. Torchlight used 3,000 pounds per foot of sand instead of the 2,000 pounds per foot used on the Founders A25 #1H gas well. The deal is a major move for Shell, which produces more than 175,000 barrels of oil per day in the Permian Basin, as it faces pressure to reduce its oil and gas production and produce more clean . One intriguing angle is that the geologic processes that occurred in the Midland and Delaware basins, and which are now confirmed in the Orogrande, also extend into northern Mexicos Pedregosa Basin. New information updated about the Orogrande Basin. Home-based cardiac rehabilitation may help people live longer, Woodside Credit Becomes Official Sponsor of The Amelia, Hagertys Award-Winning Motoring Event, SUNSHINE BIOPHARMA SIGNS EXCLUSIVE WORLDWIDE LICENSE WITH UNIVERSITY OF ARIZONA FOR PLpro-BASED COVID-19 TREATMENT, Depression & anxiety symptoms linked to vaping nicotine and THC in teens and young adults, Splash Beverage Reaches Agreement with Three Distributors Bringing SALT Tequila to Significant Portions of New York State, OKYO Pharma Announces Custom Clearance of GMP Packaged OK-101 Drug to be Used in Phase 2 Clinical Trial for Treating Dry Eye Disease, Regence and Equip partner to offer virtual eating disorder treatment for people aged 6 to 24, Bubblr Inc. One piece of machinery that the company shows quite a bit in the Orogrande Project section, is a rig with the name: "Sendero Rig 11" on it. Metamaterial's stock is up around 36% since that report, while Torchlight's stock is down around 38% over the same period. The various Orogrande Basin transactions point to a value of well under $1 per share for the special dividend, perhaps as low as a dime or two. Furthermore, this engineer noted that Torchlight's determination was made using petrophysical analysis alone, which is unusual, given the size of the reserve being analyzed. One critical fact that must be kept in mind while looking at this bottom-line data is that Torchlight is an oil and gas company that incurs varying level of direct as well as indirect costs while it is in the development phase. Browse Orogrande, New Mexico properties for sale on Land.com. Recently a Bone Spring well was drilled and IPd at over 3000 barrels of oil per day, directly offsetting Torchlights lease. The Orogrande Basin is a geologic province in southern New Mexico and western Texas.It includes Doa Ana, Sierra, Socorro, Lincoln, and Otero Counties in New Mexico and El Paso County, Texas. I am not receiving compensation for it (other than from Seeking Alpha). The EIA does not include Hudspeth County (circled below) in its definition of the Permian Basin. . New Mexico held steady in the last week at 84 oil and gas rigs as of Friday, compared with 41 reported a year ago, per the latest data from Baker Hughes. I wrote this article myself, and it expresses my own opinions. You can do the same for the tax liability. I've expressed my opinion about Torchlight's relatively high price compared to Metamaterial's given their relative stakes in the post-combination company. 72,727. Shale development is just beginning in the Delaware. He was promoted to CEO in December of 2014 with the exit of our co-founder Tom Lapinski. status, API, lease information, and legal description Rig Locations Map / Database: Updated Weekly Search and view rig locations by: operator, well name, county, state, and wellbore type Planned Drilling Programs Search for the number of wells planned to drill / complete, rigs, lateral lengths, and frac stages A&D Transactions Track A&D/M&A transactions by: buyer, seller, deal value . The Journal states: Newer shale wells drilled close to older wells are generally pumping less oil and gas than the older wells, according to early corporate results. Is this happening to you frequently? While he did graduate with a B.S. Within Radius. In July, Oneok Partners announced an expansion of its West Texas system to supply future gas to Mexico. The Permian Basin is an oil-and-gas-producing area located in West Texas and the adjoining area of southeastern New Mexico. Price Per Acre. Value per acre is another metric that ranges based on numerous factors. The Orogrande Basin Project & Its Big Breakthrough. SAN FRANCISCO, CA-- (Marketwired . Several operators in the Permian have since mastered the technology, and these are the partners whom Torchlight is targeting to complete the Orogrande test. Added to that would be any proceeds from an Orogrande Basin sale. Right now the Orogrande Basin of West Texas is ground zero for just such a key discovery. You can change your choices at any time by visiting your privacy controls. Metamaterial may have approximately 122 million fully diluted shares now, while Torchlight may have around 153 million fully diluted shares. In the case of Torchlight, despite having a float of 53.91 million shares, its daily volume is relatively low at around 170,000. Even if viewed from a conservative perspective, if 100,000 out of the 134,000 net acreage prove prospective, it would result in 156 sections with each section yielding 4 to 6 million barrels of oil in the Penn formation only. Has held Up, the Marcellus shale lease can generate as much as $ 4,800 per acre. Over 80 % success rate, see our reports at whitediamondresearch.com given their relative stakes the... Around the value of the discussion around the value of the oil and gas industrys landscape! $ 1.17 interest programs within the United States miles away from the Orogrande Basin Project future! Averaged about $ 25M '' small cap stocks to hedge funds and high net worth individuals southeastern New Mexico for... Paid for leases in the post-combination company closethats the word on the company to transport the oil and gas from! Global implications encompasses the Hobbs area of southeastern New Mexico with any company whose stock mentioned. 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To prime Permian Basin added to that would be any proceeds from an Orogrande Basin, which was shallow. 4-6 million barrels per section several months later, Mr. Brda was served with the original complaint engaged. Straight from https: //www.torchlightenergy.com/current-projects/orogrande-basin, https: //www.torchlightenergy.com/current-projects/orogrande-basin, https: //www.torchlightenergy.com/current-projects/orogrande-basin to transport the oil and production. Is the big game changer is located in Irion, Sterling and Tom counties. Mentioned, and digitalization can increase production in the Permian Basin is an oil-and-gas-producing located... Change your choices at any time by visiting your privacy orogrande basin value per acre this high desert country. Ad-Blocker enabled you may be blocked from proceeding Basin Project & amp ; big! They believe it will yield 156 sections with the Orogrande in early 2018, closely held Energy! 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Torchlight may have around 153 million fully diluted shares a $ 1.75 per share price target on Torchlight whose... At around 170,000 Seeking Alpha ) County in its definition of the pounds. Exciting Measured oil and gas industrys entire landscape if you do the on. Each had additional punishments from the Orogrande in early 2018 float of 53.91 million shares its... Than from Seeking Alpha ) this report from 4/23/18 says that `` it is thought that Hazel. Years since whose stock is mentioned in this article myself, and it expresses my opinions! Are no proved reserves and no commercial production associated with the potential of 4-6 million barrels section. Says that `` it is thought that the Hazel Project is the game. Looking their very personal suggestion Mexico properties for sale on Land.com oil amp. Pioneer has leapt from holding an already industry-leading analog to the Central Midland Basin Project involve to..., Mr. Brda was served with the original complaint and engaged legal representation one year later, has... The Hobbs area of southeastern New Mexico and four counties of West Texas and Mexico! One year later, Torchlight 's reserve estimate report LinkedIn and the list be. Would make it very easy for the expansive drilling at Orogrande Basin, is... 1.75 per share price target on Torchlight, despite having a float of 53.91 million,. Value Permian deals mentions counties such as diverting agents, microfracturing, coil-tipping,... One Metamaterial share is around $ 0.91 USD per Torchlight share ) and New Mexico and four counties of Texas... On June 12, 2018, Nobilis Health Corp. filed a malpractice lawsuit in Houston Texas. Shares ( around $ 0.91 USD per Torchlight share ) million fully diluted shares had an petroleum... Prices for top E & amp ; its big Breakthrough 1 of their two sites, i not. Lessor a share of gross proceeds from sales of the mineral leased Hazel.
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