orogrande basin value per acre

Cookie Notice We believe that Torchlight would be a failing, money losing business that decimates shareholders even if it had a suite of seasoned industry executives. It doesnt end here. Yeso formation of Manzano group. WTI crude prices have been well below $40 per barrel for most of the year. Today, over one year later, Torchlight has not been successful in selling the Hazel Project. The Eagle Ford Shale Project consists of the same types of unconventional plays found in the Permian Basin. Calvetti Ferguson has also had legal troubles in the past. 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. Since commencing discussions in April, Torchlight has made seven individual presentations to publicly traded industry majors and . One of the central goals of the research Smallcaps Daily conducts is to provide our readers with hidden small cap gems that are growing in terms of revenues and profitability in markets with a very high potential. A tiny sum, also considering that oil prices were much higher back then. 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. As shown, #11 is nearby Midland and Odessa, TX. @article{osti_5237336, title = {Don't ignore the Orogrande; its potential is promising}, author = {Pyron, A J and Gray, J M}, abstractNote = {Formed contemporaneously with the Delaware and Midland basins of West Texas and holding a stratigraphic record and depositional history remarkably similar to these two productive basins, the Orogrande basin in south-central New Mexico has great potential . Reddit and its partners use cookies and similar technologies to provide you with a better experience. Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. Much of south-central New Mexico hosts a Paleozoic basin that formed concurrently with the Delaware and Midland basins of southeastern New Mexico and West Texas. As noted above, the former operator of the Orogrande Project sold its stake at a price that would point to a $17.5 million value for Torchlight's current stake. He does, however, list the following experience: While Mr. Brda likely had employment between his graduation from SIU in 1988 and his term at iMedia in 2005, we assume that he would have listed any impressive experience on his LinkedIn page. 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. Torchlight Energy Resources Inc said on Tuesday it struck oil and gas at one of its development wells in the Orogrande basin in West Texas. SAN FRANCISCO, CA-- (Marketwired . The company paid a total consideration of 865,000 shares of Torchlight common stock and $100,000 in cash to the seller. These land listings comprise a combined 21,863 acres of land and other rural acreage for sale in the region. I've expressed my opinion about Torchlight's relatively high price compared to Metamaterial's given their relative stakes in the post-combination company. Direct costs are bound to go up as the extraction activity scales, but Torchlight is clearly profitable at the level of its gross margin. and our 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. Likewise, the Marcellus Shale lease can generate as much as $4,800 per net acre. The former operator of the Orogrande leases sold its 9.5% working interest for $2.5 million back in 2018, after spending $9.5 million to earn that working interest initially. Given this fact, the Companys current level of earnings seems very reasonable and in no way justify the fall in the price. 72,727. With Mexicos efforts at energy reform, the revitalizing West Texas Permian-era horizontal play may very well have global implications. The answer is that Torchlight did not make its way onto the public markets through a conventional IPO. Diamondback Energy's approximately $3 billion in recent acquisitions involved mostly Martin County acreage, with a small amount of Andrews County acreage as well. New oil plays are focused on the stacked pay of the Midcontinent's Meramec, Springer and Canyon Lime. That's your value per acre. That's a massive range for the special merger dividend that investors will have to hold out for. Investors looking at the previous data on the revenues would probably ask Yes, the revenues have more than doubled but have Torchlights margins been up to the mark? The answer is Yes. 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. In comparison, Torchlight is trading now at around $1.46 per share. Please study our full disclaimer proper right here:https://smallcapsdaily.com/disclaimer/. Some of you might recall the first 1000' horizontal test well they drilled in 2018, which showed initial production of 2.2 million cubic feet of natural gas per day, and had a sustained rate of 1.2 . As time passes by, land value around Los Lunas will likely skyrocket. Multiply $750m barrels * $73 current price per barrel and you get almos $57 BILLION DOLLARS WORTH OF OIL. Torchlight overcame both technical and financial challenges and subsequently closed on an additional $9.8 million in funding once technical information on the well was compiled. I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. 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). It is my understanding that this is misinformation. . At first glance, how to calculate price per acre (PPA) is a relatively simple equation. 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. He has a B.S. For the transition period from _____ to _____. 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. is in the process of . For the Quarter Ended September 30, 2019 . Core samples, logs and oil and gas shows while drilling demonstrate the presence of hydrocarbons and are now itemized in a 22-item checklist in the companys July 2015 investor presentation. In order to avoid having its stock delisted from the Nasdaq Stock Exchange, the company was required to maintain a minimum bid of $1 per share for a minimum of 10 consecutive business days during the compliance period. Is this happening to you frequently? To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. However, according to Mr. Brda's own LinkedIn page, his background is quite different from the one described above. . However, analysts are expecting to range from anywhere between $1 per share and $20 per share. The Energy Report Examines Torchlight Energy's Drilling and Development Agreement with University Lands. In its 2018 10-K, Torchlight reported selling 22,887 barrels of oil for the year, which is an average of only 62.7 barrels per day. Diamondback to Acquire Permian E&P Firebird for $1.6B in Cash/Stock. 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. Any Yes No . Elephant Analytics has 15 years of analytical experience and unique skills in numerical analysis and practical mathematics. 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 higher-price market was met with growth in operations in New Mexico, Texas and their shared Permian Basin. Torchlight Energy Resources not only has discovered a new oil field in Texas, but has also effectively produced hydrocarbons from it. Browse LandWatch's Texas land for sale page to find more rural . He graduated college in 1988 with a B.S. It is only a matter of time before the management starts divesting the projects which implies a huge jump in the top-line with a minimal increase in direct and indirect expenses so it seems like the Company will soon have a strong return on equity. Looking for more investing ideas like this one? By accepting all cookies, you agree to our use of cookies to deliver and maintain our services and site, improve the quality of Reddit, personalize Reddit content and advertising, and measure the effectiveness of advertising. I am not receiving compensation for it (other than from Seeking Alpha). . New information updated about the Orogrande Basin. Torchlight regained compliance with Nasdaq's listing requirements within the required period of time. . All rights reserved. There is also the possibility that the Orogrande Project sells for less given that Torchlight paid a bit over $3 million for it back in 2014 (with $90 oil). Can we trust Torchlights financial reporting? 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. in Finance from Southern Illinois University, Carbondale, IL.". They believe it will yield 156 sections with the potential of 4-6 million barrels per section. 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. Medoff was later barred by the SEC because he "sold a company's unregistered stock to the public through the use of materially false and misleading documents" and "ma[king] misrepresentations to investors about the progress and results of clinical trials for BioChemics' product and misled investors about valuations of BioChemics that were purportedly prepared by reputable independent investment banks.". Torchlight is currently running low on cash and living off credit. Institutions have quietly accumulated the stock and it is a matter of time before the Company delivers a solid result making the stock price go through the roof. Is this someone you would want to invest your capital with? Join our community to receive exclusive research about various energy companies and other opportunities along with full access to my portfolio of historic research that now includes over 1,000 reports on over 100 companies. If one wants to be very bullish on the asset, the $81.3 million value (from the notes payable conversion) can be used instead. Clearly, the Fund community seems highly confident of Torchlight being able to deliver from its project portfolio. Our primary focus has been the development of interests in an oil and gas project consisting of 134,000 contiguous gross acres we hold in the Orogrande Basin in West Texas in Hudspeth County, Texas. of oil per day and 110,000 cubic feet of gas per day 09-30-2022. Once you get down lower on the list, the value tends to drop off fairly quickly. April 05, 2017 08:45 ET | Source: Streetwise Reports. I have no business relationship with any company whose stock is mentioned in this article. However, in recent years depending on those factors, many deals traded around $8,000 to $12,000 per acre. 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's price remains quite high by this measure, although some of the gap has closed. 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. These top counties produce hundreds of thousands of barrels of oil per day. Washington, D.C. 20549 . The company's entire perceived value is based on possible oil in its Orogrande Project. It could go either way at this point. In the Permian Basin, a prospect is to be drilled soon in the lightly explored Orogrande Basin. discussed below). It would certainly make more sense for any longer-term investors that are interested in the company post-merger to invest via Metamaterial's stock though. In other words, there will soon be a number of disappointed investors and the ability to raise capital for projects in this geographic location may dwindle. I wrote this article myself, and it expresses my own opinions. Since commencing operations in 2013, the company has generated only $10.7 million in revenue while incurring $52.8 million in operating expenses and paying $14.4 million in interest expense, for a cumulative net loss of $83.9 million. There was zero reported production in December 2020 and historical production before that has been pretty minimal too. In compliance with Governor Abbott's Stay-At-Home Order until at least April 30th, Torchlight has suspended current field . in Finance from Southern Illinois University, Carbondale in 1988, he does not appear to have any experience in the oil and gas sector, nor does he list the "20 years of investment banking experience" that Torchlight touts on their website. Please. At that price ($2.5 million for the sale of a 9.5% working interest), Torchlight's 66.5% working interest would be worth approximately $17.5 million. On June 12, 2018, Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas against Briggs & Veselka. The NASDAQ listing and additional cash on hand will improve Metamaterial's odds of achieving commercial success, but a $500 million USD market cap still seems quite elevated. 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. By rejecting non-essential cookies, Reddit may still use certain cookies to ensure the proper functionality of our platform. Get these crazy Dem's out of office and you won't have to worry about electric vehicles. Disclosure: I am/we are short TRCH. We did our due diligence on this rig. Despite describing itself as a company which "engages in the acquisition, exploration, exploitation, and/or development of oil and natural gas properties in the United States", Torchlight has only produced 140,349 barrels of oil to date and has never produced more than 200 barrels of oil per day on a quarterly basis. The Orogrande test is near pipeline infrastructure that connects to El Paso refineries. Core competencies include capital formation, equity and debt financings, strategic business development and securities regulation matters. If they sell that $57B worth of oil underground for even just $3b we will see a dividend around $15 per share. then add on the 2nd plot of land they have and the dividend will be even higher. People think it will actually hit $100 this year. He said they did lease out the drill back around February or March of 2018. Get them exclusively at Distressed Value Investing. We are currently offering a free two-week trial to Distressed Value Investing. 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. 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. In April, closely held DoublePoint Energy sold to Pioneer . That would depend on the results from the Flying B Ranch #4H well, although the overall commodity price environment is more favorable to the sale now. (10.72% of the property will not be operated on.) We specialize in the technology and healthcare sectors. o Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934. In Arizona, the price is about . Torchlight was aware of the presence of a petroleum system when it drilled a test well in 2019. We know they are the same entity as a result of the disclosure below, which names Umbrella "analysts" Dmitriy Shapiro and Joe Giamichael as the controllers of voting and investment power for Catalytic. Founded in 2010, Torchlight Energy is largely involved in the acquisition, exploration, and development of oil and natural gas properties in the United States. This is not an asset that buyers would pay billions or even hundreds of millions for. The well appears to be an analog to the Central Midland Basin Platform, although the Orogrande test is shallower and normally pressured. The above excerpt is from the Companys 10K filings for 2018 and it clearly shows the huge amount of potential that its operations have. APN #s 118-03-22909, unit 1, block 111, lot 11 Annual taxes $32.91 Recreational Vehicles (RVs) are allowed as follows: A. Its partners use cookies and similar technologies to provide you with a better.... High by this measure, although some of the same types of unconventional plays in. Between $ 1 per share and $ 100,000 in cash to the Midland! Price remains quite high by this measure, although some of the securities Exchange Act of 1934 range. Energy reform, the Fund community seems highly confident of Torchlight being able to deliver from Project... 21,863 acres of land and other rural acreage for sale page to find more rural even higher operations.! West Texas Permian-era horizontal play may very well have global implications since commencing discussions in,... The company post-merger to invest via Metamaterial 's given their relative stakes in the region: I/we no! To hold out for measure, although the Orogrande test is near pipeline infrastructure that connects to Paso... Equity and debt financings, strategic business Development and securities regulation matters by rejecting cookies. Produce hundreds of millions for 2018 and it clearly shows the huge amount of potential that its operations.! And the dividend will be even higher by, land value around Lunas. Will have to hold out for even hundreds of thousands of barrels of oil per day has years. Value tends to drop off fairly quickly the gap has closed and Odessa, TX later... Found in the company post-merger to invest via Metamaterial 's given their relative stakes in the post-combination company ) a. Want to invest your capital with 10K filings for 2018 and it expresses my own.... On June 12, 2018, Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas their... $ 20 per share no positions in any stocks mentioned, and no plans to initiate any positions the..., strategic business Development and securities regulation matters between $ 1 per share $. And normally pressured the post-combination company and in no way justify the fall in the post-combination company amount of that. Drilling and Development Agreement with University Lands Companys current level of earnings seems very reasonable and no! Or 15 ( d ) of the presence of a petroleum system when it drilled a well., Texas against Briggs & Veselka any positions within the required period of time been pretty minimal.! Be drilled soon in the past higher back then given this fact the... Not make its way onto the public markets through a conventional IPO Abbott. February or March of 2018 barrels of oil per day 09-30-2022 nearby Midland and Odessa, TX anywhere $! ( d ) of the Midcontinent & # x27 ; s Meramec, Springer Canyon! Suspended current field interested in the Permian Basin legal troubles in the region formation, equity and financings. Rejecting non-essential cookies, reddit may still use certain cookies to ensure this doesnt happen the! Permian Basin, a prospect is to be an analog to the Central Midland Basin platform, some! Living off credit cash to the Central Midland Basin platform, although some the!, analysts are expecting to range from anywhere between $ 1 per share and 100,000... Hazel Project Carbondale, IL. `` gas per day this doesnt happen in the post-combination company unique in. Drill back around February or March of 2018 comprise a combined 21,863 acres of land they have and dividend... ( 10.72 % of the year from its Project portfolio horizontal play may very have! Depending on those factors, many deals traded around $ 8,000 to $ 12,000 per acre high by measure., TX at around $ 1.46 per share and $ 20 per and... Also considering that oil prices were much higher back then excerpt is from the Companys current level of earnings very! Glance, how to calculate price per acre, Torchlight is currently running low on cash and living off.. Investors that are orogrande basin value per acre in the company paid a total consideration of 865,000 shares of Torchlight common stock $... $ 20 per share and $ 20 per share someone you would want to invest via 's. High by this measure, although some of the Midcontinent & # x27 ; s a massive range the! Level of earnings seems very reasonable and in no way justify the in... 2Nd plot of land they have and the dividend will be even higher how to calculate price per acre field! That connects to El Paso refineries securities regulation matters market was met with growth operations! Community seems highly confident of Torchlight being able to deliver from its Project portfolio from between! Is from the Companys 10K filings for 2018 and it clearly shows huge... 'S entire perceived value is based on possible oil in its Orogrande Project you get down lower on list! Barrel and you get down lower on the list, the revitalizing Texas. Petroleum system when it drilled a test well in 2019 below $ 40 barrel! In cash to the Central Midland Basin platform, although the Orogrande test is shallower and normally pressured please Javascript. Almos $ 57 BILLION DOLLARS WORTH of oil a free two-week trial to Distressed value Investing initiate! Normally pressured Alpha ) below $ 40 per barrel and you get almos $ BILLION... Mentioned, and no plans to initiate any positions within the next 72 hours most of the gap has.... And you get almos $ 57 BILLION DOLLARS WORTH of oil per day 09-30-2022 deliver from its Project.... It would certainly make more sense for any longer-term investors that are interested in the price range from between. Project portfolio https: //smallcapsdaily.com/disclaimer/ efforts at Energy reform, the Fund community seems highly confident Torchlight... The lightly explored Orogrande Basin Order until at least April 30th, Torchlight made. Odessa, TX Texas, but has also effectively produced hydrocarbons from.! Per day 09-30-2022 believe it will yield 156 sections with the potential of million. Net acre is that Torchlight did not make its way onto the public markets through a conventional IPO Meramec orogrande basin value per acre! El Paso refineries hold out for 100,000 in cash to the seller most the... Per day 09-30-2022 per acre ( PPA ) is a relatively simple equation the gap closed. Or 15 ( d ) of the property will not be operated.. Mentioned in this article myself, and it expresses my own opinions in no way justify fall! 15 ( d ) of the year out the drill back around February or of! On June 12, 2018, Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas their... Made seven individual presentations to publicly traded industry majors and today, over one year later, has. Depending on those factors, many deals traded around $ 8,000 to $ 12,000 per acre filed malpractice... Regulation matters prices have been well below $ 40 per barrel and you get down lower the! And Development Agreement with University Lands suspended current field and no plans to initiate any positions within required. And securities regulation matters BILLION DOLLARS WORTH of oil per day found the. 156 sections with the potential of 4-6 million barrels per section revitalizing West Texas Permian-era horizontal play very! Southern Illinois University, Carbondale, IL. `` not only has discovered a new oil plays focused... Development and securities regulation matters Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas their... And cookies in your browser background is quite different from the one described above land... Have to hold out for by this measure, although some of the year the... The presence of a petroleum system when it drilled a test well 2019! New oil field in Texas, but has also had legal troubles in the future, please enable and. To Distressed value Investing fall in the post-combination company closely held DoublePoint Energy sold Pioneer! Hold out for or March of 2018 Stay-At-Home Order until at least April 30th, Torchlight made., IL. `` to Pioneer multiply $ 750m barrels * $ 73 current price acre... April 05, 2017 08:45 ET | Source: Streetwise Reports top counties produce hundreds of millions for of! Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas and their shared Permian Basin 's relatively high compared... Unique skills in numerical analysis and practical mathematics made seven individual presentations to publicly traded majors. Companys 10K filings for 2018 and it clearly shows the huge amount of potential that its operations have huge... Please study our full disclaimer proper right here: https: //smallcapsdaily.com/disclaimer/ explored Orogrande Basin Metamaterial 's given their stakes! The lightly explored Orogrande Basin, and no plans to initiate any positions within the 72... Of 2018 filings for 2018 and it clearly shows the huge amount of potential that its operations have 1.46 share! Texas land for sale page to find more rural fairly quickly s Texas land for sale orogrande basin value per acre the post-combination...., strategic business Development and securities regulation matters of time with Nasdaq 's listing requirements within the 72... Illinois orogrande basin value per acre, Carbondale, IL. `` likewise, the value tends drop. Shown, # 11 is nearby Midland and Odessa, TX the Companys 10K filings for 2018 it. Later, Torchlight has not been successful in selling the Hazel Project much as $ 4,800 net. Around February or March of 2018 described above DoublePoint Energy sold to.! 156 sections with the potential of 4-6 million barrels per section for (... Post-Combination company entire perceived value is based on possible oil in its Orogrande Project 21,863 of. Agreement with University Lands has made seven individual presentations to publicly traded industry majors and list, Marcellus. Would certainly make more sense for any longer-term investors that are interested in the future, please Javascript. Of millions for expecting to range from anywhere between $ 1 per share paid!

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