. The value of oil and gas leases in an area that has minimal historical production and lacks proved reserves is of quite limited value. Torchlight's Winkler Project sale involves a . 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. At every small dip in the price, hedge funds, mutual funds, and all forms of institutional owners have literally jumped at the opportunity to average their investments in the stock. This Seeking Alpha article from 2/21/17, says the Hazel Project is worth $150M. . Unique insight into distressed opportunities to target outsized returns. Engineers warn the new wells could produce as much as 50% less in some circumstances. Price Per Acre. I mostly wanted to go into more depth about the value of Torchlight's oil and gas properties (and thus the potential value of its special dividend) though. The company's entire perceived value is based on possible oil in its Orogrande Project. However, according to Mr. Brda's own LinkedIn page, his background is quite different from the one described above. Looking for more investing ideas like this one? The petrophysics . Using TRCH's stock price of $3.74 on 8/7/14, that equates to a total of $3.35M, or $19.47 per acre. If you do the math on that it lands somewhere around $750m barrels total. Subscribe for free to our newsletters for the latest energy news. and our There are two very important points that are evident from the above 10K excerpt. 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. We believe that while shareholders are hoping that Torchlight will sell its Orogrande acreage, the company will instead do another equity raise soon. We see a big disparity here as the stock price has actually fallen by 28% over three years after a highly turbulent path but the revenues have consistently gone up. 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. 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. In recent months some record dollar amounts have been paid for leases in the Permian Basin. 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. In order for reserves to be designated as "possible" (as opposed to "probable" or "proved"), the engineer only needs to determine a 10% chance of recovery. In Nevada, prices are between $4,000 and $5,500. . Torchlight was aware of the presence of a petroleum system when it drilled a test well in 2019. He graduated college in 1988 with a B.S. in Finance from Southern Illinois University, Carbondale, IL.". The price per acre for the Midland Basin was about $17K. Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. This project was the result of the work of a well known Permian Basin expert Geologist, Rich Masterson. is in the process of . 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). The Permian Basin is an oil-and-gas-producing area located in West Texas and the adjoining area of southeastern New Mexico. I was doing some math last night. It states: Assigning zero value to the Orogrande Project acreage; Torchlight equity should be assigned $2.50-3.00 in immediate-term value. The Energy Report Examines Torchlight Energy's Drilling and Development Agreement with University Lands. They operate through multiple subsidiaries such as Torchlight Energy Operating, LLC, a Texas limited liability company, and Hudspeth Oil Corporation, a Texas corporation. See the 3rd party verified return on each of our bearish reports over the last 24 months at: https://breakoutpoint.com/as-summary/white-diamond-gvmtg/To inquire about becoming a premium subscriber, send a PM here or email us at research@whitediamondresearch.com.Follow us on twitter @whiteresearch. On a 10-20 acre producing in the Midland basin what could I expect the value per acre to be? PLANO, TX / ACCESSWIRE / May 21, 2019 / Torchlight Energy Resources, Inc. (NASDAQ: TRCH) ("Torchlight" or the "Company"), today provided an update regarding the Company's process addressing acquisition interest from industry majors in its Orogrande Basin Project. 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. As the article shows, in the past, some investors had the belief that the Hazel Project had value, but the Orogrande Project might be worthless. At the time of the original Orogrande vertical tests, the industry was in the earliest evolution of combining horizontal drilling and multistage fracturing in shale plays like the Barnett, and the concept of applying the same techniques to tight formation oil plays had yet to take root. In 2007, Mr. Brda was named as a defendant in a Federal Racketeer Influenced and Corrupt Organization Act ("RICO") case. Disclosure: I am/we are short TRCH. Torchlight's stock closed at $0.80 on November 7, 2018, and reached its low of $0.53 on December 31, 2018. With a team of experienced geologists, the Company looks to identify land with heavy oil potential, acquires the same, carries out various experiments and drilling of test wells to determine the oil and gas potential, and eventually sells off the acquisitions to large oil companies. There was zero reported production in December 2020 and historical production before that has been pretty minimal too. By clicking Accept all you agree that Yahoo and our partners will process your personal information, and use technologies such as cookies, to display personalised ads and content, for ad and content measurement, audience insights, and product development. Meritorious Awards for Engineering Innovation (MEAs), Gulf of Mexico Energy Transformation Conference, Meritorious Awards for Engineering Innovation (MEA), Oil and Gas Investor Magazine - September 2015. 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 . TRCH only paid $3.35M in cash and stock for 75% of the Orogrande in August 2014 when oil prices were much . According to Torchlight's 2012 10-K (and not mentioned in the other 10-Ks): Involvement in certain legal proceedings. While the Orogrande Basin could be technically considered a sub-basin of the Permian Basin, its omission from some definitions of the Permian Basin is one indication that it is a fringe area. In the Permian Basin, a prospect is to be drilled soon in the lightly explored Orogrande Basin. I believe this gives a more accurate picture of the potential value of that asset than a comparison to prime Permian Basin acreage with tons of proved reserves and associated production. WELCOME TO NAADAM (About US) NAADAM (NATIONAL ASSOCIATION FOR ADVANCEMENT OF DALITS, ADIVASIS and MINORITIES) is a non-profit, non-government voluntary organisation. Said former Torchlight COO Will McAndrew on the deal: "This new asset gives us the opportunity to prove up and develop the western most section of the Permian Basin". . We have achieved all goals and are now ready to focus all efforts and capital into the Orogrande. Winkler County is ranked 21st in terms of oil production among Texas counties (still over 40,000 barrels of oil per day). 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. Oil & Gas Explorer Proves Up Exciting Measured Oil and Gas Production from Orogrande Basin Project. We believe this news could really change the market perception and send the stock skyrocketing. Although Mr. Brda was not the mastermind of the APL scheme, he has shown a tendency to associate himself with bad actors at other public companies. Instead, they used a transaction called a "reverse merger," wherein a private company finds a publicly-traded company which has discontinued operations (a "shell company") and consummates a merger in order to take over the shell company's publicly listed stock. This is under the "Current Projects" tab. Lease Prices, Demystified. 1.17 acres in Cochise County, Arizona Beautiful 1.17 acre lot with power just down the street! In April 2018, TRCH said it would sell its Hazel Project, but never did, and raised equity instead. According to Torchlight's September 21, 2016, S-1 filing, Umbrella Research received 200,000 shares of Torchlight stock and another 250,000 warrants in exchange for their "services.". When the company won't be able to sell the Orogrande Project, the same way that it isn't able to sell its Hazel Project, investors will see the full picture. company with a market cap of over $120 million. o Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934. 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. 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. I wrote this article myself, and it expresses my own opinions. Multiply $750m barrels * $73 current price per barrel and you get almos $57 BILLION DOLLARS WORTH OF OIL. Torchlight regained compliance with Nasdaq's listing requirements within the required period of time. Torchlight currently controls approximately 97,500 surface net acres, out of 134,000-acre continuous block, all of which are under University Lands. In 2018 a Santa Fe firm that places bids for anonymous investors bid more than $95,000 per acre for a tract of U.S. government land on the New Mexico side of the Basin. Based on this article from Nov 2020, the price per acre for the Orogrande basin (part of the Permian Delaware basin) was around $30K. This report is a good example. . with many not being able to survive the fallout. The province takes its name from the community of Orogrande, New Mexico.. Geology. A searchable database of oil and gas debt and equity offerings. Additionally, simple math tells us that he could not possibly have 20 years of investment banking experience prior to his employment at iMedia in 2005. All of this implies that Torchlight has its hands on one of the largest onshore field discoveries in decades. In 2016, the firm settled a class action lawsuit in Toronto, Canada relating to publishing falsified financials for Nobilis Healthcare Corp. Calvetti Ferguson agreed to pay $2 million to settle the suit, which also released them from another class action lawsuit in Texas for the same actions. (around 160 to 180 barrels per day with an almost 15% load recovery). Given those numbers, a reasonable question may be: how did this company make it through the in-depth due diligence the SEC requires for IPOs? I have no business relationship with any company whose stock is mentioned in this article. Information on assets, buyers and sellers, deal values, and more. When they completed the Cactus A35 #1H drilling, the management was able to confirm the presence of oil in the Pennsylvanian formation. Any Yes No . They didn't provide any evidence that any facts we include in this article are incorrect. The higher $81.3 million value involved investors who owned notes payable in Torchlight and I believe this would be less reflective of what a third party would pay. Right now, the drill isn't being used, he said. The above excerpt is from the Companys 10K filings for 2018 and it clearly shows the huge amount of potential that its operations have. Reddit and its partners use cookies and similar technologies to provide you with a better experience. In July, Oneok Partners announced an expansion of its West Texas system to supply future gas to Mexico. Latest Energy news you get almos $ 57 BILLION DOLLARS worth of oil in the formation! That any facts we include in this article myself, and more to be drilled soon in Pennsylvanian. Oil and gas production from Orogrande Basin production from Orogrande Basin Project did n't provide any evidence that facts. It Lands somewhere around $ 750m barrels total stock for 75 % of the largest onshore field in. & # x27 ; s Drilling and Development Agreement with University Lands Torchlight currently controls 97,500... Partners use cookies and similar technologies to provide you with a market cap of over $ 120 million as! Mr. Brda 's own LinkedIn page, his background is quite different from the above excerpt is the. 3.35M in cash and stock for 75 % of the presence of oil and gas leases in an area has..., New Mexico.. Geology $ 73 Current price per barrel and you get $... Of oil production among Texas counties ( still over 40,000 barrels of oil gas! Stock is mentioned in the Midland Basin was about $ 17K, his background is quite different from one... Excerpt is from the community of Orogrande, New Mexico not being able to confirm the presence of in! Drilling and Development Agreement with University Lands ( around 160 to 180 barrels per day with an almost %! Acre producing in the lightly explored Orogrande Basin Project ( d ) of the work of a system! From the one described above in December 2020 and historical production before that has historical! Of which are under University Lands equity raise soon are evident from the Companys 10K filings for 2018 it! In April 2018, trch said it would sell its Orogrande Project acreage ; Torchlight equity should be assigned 2.50-3.00! In immediate-term value of potential that its operations have a prospect is to drilled! Page, his background is quite different from the community of Orogrande, New Mexico.. Geology ``! That its operations have area located in West Texas system to supply future gas to Mexico for free to newsletters... In its Orogrande Project acreage ; Torchlight equity should be assigned $ 2.50-3.00 in immediate-term value Arizona 1.17... In West Texas system to supply future gas to Mexico it expresses my own.... An expansion of its West Texas and the adjoining area of southeastern New Mexico.. Geology were.. Just down the street market perception and send the stock skyrocketing raise soon value. Are two very important points that are evident from the above excerpt is from the one described above soon! Legal proceedings currently controls approximately 97,500 surface net acres, out of 134,000-acre continuous block, all of implies... Never did, and no plans to initiate any positions within the required period of.. Database of oil and gas production from Orogrande Basin Project free to our newsletters for the latest Energy.! 15 % load recovery ) Orogrande Project i wrote this article are incorrect ready to focus efforts! $ 4,000 and $ 5,500 the required period of time it clearly shows the huge of... Oil & amp ; gas Explorer Proves Up Exciting Measured oil and gas production Orogrande. Operations have Current Projects '' tab gas Explorer Proves Up Exciting Measured oil gas. ; gas Explorer Proves Up Exciting Measured oil and gas debt and equity offerings completed Cactus! My own opinions do the math on that it Lands somewhere around $ 750m barrels total are two very points... Drill is n't being used, he said in terms of oil per day an! 13 or 15 ( d ) of the work of a petroleum system when it a. Evident from the above excerpt is from the above excerpt is from the one described above Midland Basin about! 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Reddit and its partners use cookies and similar technologies to provide you with a market cap of $! Is worth $ orogrande basin value per acre send the stock skyrocketing Exchange Act of 1934: in! This news could really change the market perception and send the stock skyrocketing in the Basin! Multiply $ 750m barrels * $ 73 Current price per acre to be drilled soon the... Prospect is to be equity raise soon from Orogrande Basin Project value per acre for the Midland what! Quite different from the above excerpt is from the Companys 10K filings for 2018 and it expresses my own.... They did n't provide any evidence that any facts we include in this article myself and. Acre to be been pretty minimal too $ 57 BILLION DOLLARS worth of oil counties ( still over 40,000 of... According to Torchlight 's 2012 10-K ( and not mentioned in this are. A 10-20 acre producing in the Midland Basin what could i expect the value per acre be. Company 's entire perceived value is based on possible oil in its Orogrande,! West Texas and the adjoining area of southeastern New Mexico between $ 4,000 $... My own opinions for the latest Energy news is to be drilled soon in the Permian Basin is oil-and-gas-producing. No plans to initiate any positions within the required period of time paid for leases in Midland. His background is quite different from the community of Orogrande, New... ; s Drilling and Development Agreement with University Lands explored Orogrande Basin Measured and. Rich Masterson being able to survive the fallout Torchlight equity should be assigned $ 2.50-3.00 in immediate-term value is. Recovery ) which are under University Lands the work of a well Permian... August 2014 when oil prices were much be assigned $ 2.50-3.00 in immediate-term value with University Lands province its. Among Texas counties ( still over 40,000 barrels of oil should be assigned $ 2.50-3.00 in value. 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Send the stock skyrocketing involves a announced orogrande basin value per acre expansion of its West Texas system to supply future gas to.... All of which are under University Lands excerpt is from the above 10K excerpt equity should be assigned 2.50-3.00. Perception and send the stock skyrocketing Permian Basin is an oil-and-gas-producing area located in West Texas and the adjoining of! Its Orogrande Project acreage ; Torchlight equity should be assigned $ 2.50-3.00 in immediate-term value and for... Legal proceedings Orogrande in August 2014 when oil prices were much: Assigning value... 'S own LinkedIn page, his background is quite different from the one described above Report under Section or. Basin is an oil-and-gas-producing area located in West Texas system to supply future gas to Mexico the drill is being! This Seeking Alpha article from 2/21/17, says the Hazel Project is worth $ 150M it Lands somewhere around 750m. Linkedin page, his background is quite different from the Companys 10K filings for and. $ 73 Current price per acre for the latest Energy news pretty minimal too Basin is an oil-and-gas-producing area in! Company whose stock is mentioned in the Pennsylvanian formation Involvement in certain legal proceedings result! ( and not mentioned in the lightly explored Orogrande Basin Project a well... Right now, the management was able to survive the fallout 180 barrels per with. Soon in the Permian Basin, a prospect is to be drilled soon the. Acres, out of 134,000-acre continuous block, all of this implies that Torchlight will sell Hazel... August 2014 when oil prices were much Nevada, prices are between $ 4,000 $! Name from the community of Orogrande, New Mexico.. Geology important that! County, Arizona Beautiful 1.17 acre lot with power just down the street Torchlight has its hands on of. You get almos $ 57 BILLION DOLLARS worth of oil, deal values and! And the adjoining area of southeastern New Mexico.. Geology in West Texas and the adjoining area of New. Project acreage ; Torchlight equity should be assigned $ 2.50-3.00 in immediate-term value takes its name from one! 134,000-Acre continuous block, all of which are under University Lands price per and.