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Torchlight Energy Resources, Inc. (TRCH)

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Last Post: 2/21/2017 10:51:54 AM - Followers: 19 - Board type: Free - Posts Today: 0

Torchlight Energy Resources, Inc. (TRCH) is a high growth oil and gas Exploration and Production (E&P) company primarily focused on the acquisition and development of highly profitable domestic oil fields. Leveraging a diverse portfolio, carefully selected interests, and a strong management team are pillars of Torchlight's broader success strategy.

The company maintains a diversified energy portfolio by holding interests in numerous projects in multiple established plays, and currently holds interests in Texas, Oklahoma and Kansas, where its targets are established plays such as the Wolf Penn, Eagle Ford Shale, Mississippi Limestone and Hunton Limestone trends.

Torchlight is currently moving forward on the next phase of drilling on three new wells in its Orogrande Project in West Texas, where the company owns a 47.5% working interest on 168,000 acres alongside Founders Oil and Gas, LLC. Torchlight drilled the Rich A-11 well (6,091 feet) on the Orogrande Project in March last year and subsequently executed a $50 million JV farm-out agreement with Midland, Texas-based Founders Oil and Gas, who initiated frac work on the well in November.

The Marcelina Creek Project in South Texas, with its prime access to the Austin Chalk, Buda, and Eagle Ford formations, is surrounded on all four sides by leading Eagle Ford producers. Torchlight's Johnson #4 well was recently re-entered and drilled laterally to approximately 2500 feet in the Austin Chalk Formation. With more than 20 additional drilling locations on its Marcelina Creek Asset, the project has the potential to positively impact cash flows and production sustainability.

www.TorchlightEnergy.com

 


Investment Highlights

  • Defined strategy targets highly profitable oil fields in the United States
    Diversified energy portfolio enables projects in multiple established plays
    Primary focus on interest in major Orogrande Basin discovery in West Texas
    Strong management team with vast, relevant experience in energy industry

 


Project Portfolio

Orogrande Project - Hudspeth County, TX

  • Torchlight owns 95% working interest (85.5% WI after payout) – 168,000 acres
    Targeting 1300' of pay – described as WolfPenn
    Pay zone depths – 4000' to 6100'
    Oil and high BTU gas – 80/20 mix expected
    Basin formed at the same time as Delaware and Midland basins
    Lease covers majority of the basin in Texas
    University Lands with excellent lease terms (5 yr. with 5 yr. extensions - single drilling unit on University Block)
    If 100,000 acres prove prospective - project would yield 156 Sections
    Based on analogous Midland Basin EUR's – potential EUR's of 4 to 6 million barrels per section
    Well known Permian Basin expert Geologist, Rich Masterson originated the Wolfbone Play and developed thesis for the Orogrande Basin (WolfPenn)

 

Hunton Play - Cimarron Logan and Kingfisher County, OK

The Cimarron Project is located north of Oklahoma City in the Edmonds Field. The target formation is the Paleozoic age Hunton Group that has been the leading oil producing formation in Oklahoma. In the area, there are also numerous shallower objectives as well. The project area is approximately 3,700 acres and Torchlight has a minimum of a 15% working interest.

The operator has drilled and completed 18 successful Hunton wells in the area. The fields were originally drilled vertically and the aforementioned 18 wells were the first horizontal wells drilled in the field. Production rates on the 18 wells, after fracking and return of fluids vary from 300 to 1,160 BOPD with significant gas and gas liquids as well.

The project fits the Company's strategic plan of seeking opportunities in established plays, with competent operators, in exploitation projects with several potential pay zones and a working interest position that is meaningful to the bottom line.

Beginning in the third quarter of 2013 a one rig continuous drilling program is planned for nearly the next two years. Lastly an aggressive drilling program insures increases in net Torchlight production on a quarterly basis, which is one of the Company's stated goals.

 

Chisholm Trail - Kingfisher County, OK

The Paleozoic age Hunton Group is the primary target formation with numerous shallower objectives as well. The project area is nearly contiguous to the Cimarron project and leads to many operational efficiencies. Torchlight owns 15.3% working interest in 5,110 acres covering the Hunton Limestone development drilling project, Operated by Husky Ventures, Inc. Torchlight anticipates participating in an 5 to 6 horizontal Hunton Wells in the fourth quarter of 2013 as a result of this acquisition. The wells will be drilled to a total measured depth of 12,000 feet including 4,000 feet of lateral section. It is anticipated Torchlight will have a future participation option of 15% or more working interest in more than 50,000 total acres in the play.

Production rates are expected to be the same as Cimarron's at 300 to 1,160 BOPD and published reserves by Gastar, a working interest partner, are in excess of 460,000 barrels per well. An aggressive drilling program is planned using a two rig program beginning third to fourth quarter of 2013 and continuing for the next three years.

This project, and Cimarron, fit Torchlight's strategic plan of seeking opportunities in established plays, with competent operators, in exploitation projects with several potential pay zones and a working interest position that is meaningful to the bottom line.

 

Ring JV - Haskell, Gray and Finney counties, KS

Torchlight has entered into a joint venture agreement with Ring Energy (NYSE MKT – REI) for exploration and exploitation in the giant Hugoton Field area of Kansas. Under the terms of the agreement Torchlight will match Ring's expenditure for leases by drilling wells. Once the drilling expenditures match the lease costs Torchlight will have earned 50% in the entire 17,000 + acre block.

The acreage is included in a three county Area of Mutual Interest, covering Haskell, Gray and Finney counties.

Numerous potential pay zones exist in the area from the shallow Chase Formation, the original pay in the Hugoton Field, to the Mississippian Age carbonates. Formations such as the Lansing-Kansas City, Marmaton and Morrow all produce in the area. The initial drilling will target Mississippian Age oolite reservoirs. This formation is highly productive and can be drilled and completed vertically for a cost of approximately $650,000. Although rates and reserves vary it is expected these wells to average initial potential of 80 to 100 BOPD and have reserves in excess of 100,000 BO from the Mississippian only. Very little water is produced from this formation which greatly reduces operating costs. Drilling will begin in the fourth quarter of 2013.

This program fits Torchlight's stated strategy of low risk, exploitation programs with a proven, experienced operator that is repeatable without the need for advanced technologies. The area has the potential for up to 450 drilling locations, which provide not only replacement of yearly production but a firm platform on which to grow.

 

Marcelina Creek - Wilson County, TX

The Marcelina Creek Project lies just a few miles north of the Karnes/Wilson County line just SW of Poth, Texas. The play involves the upper cretaceous formations and is highly sought after for its Austin Chalk, Buda, and Eagle Ford formations. Torchlight is currently producing from three of the pay zones on the lease:

  • The Johnson #4 is a vertical Buda Producer
    The Johnson #1 is a horizontal Austin Chalk Producer
    The Johnson #2 is a horizontal Buda Producer with a 2700' lateral leg

The lease is completely surrounded on all four sides by Eagle Ford producers from well-known companies such as Hunt Oil and Clayton Williams. Torchlight has a 75% Working Interest (WI) in the majority of the 1080 acre block, and a 50% WI, in the smaller 280 acre block on the lease. Torchlight has announced the drilling of our next well which is slated to be a horizontal Buda completion. There are 6 to 7 horizontal drilling locations for ALL pay zones on the lease.

Potential Opportunities and Expected Reserves at the Marcelina Creek

Torchlight's management estimates that a total of six to seven horizontal wells can be drilled on the Marcelina Creek acreage to each horizon. There are multiple prospective formations located at the Marcelina Creek, including Austin Chalk, Eagle Ford and Buda, as well as additional potential formations, including Olmos, Georgetown and Pearsall. Eagle Ford production has been established on all four sides of the lease property, while there is also Buda production and Austin Chalk production in the immediate offsetting the lease. Management estimates a total of 9.33mm barrels of oil in expected reserves at the Marcelina Creek Field, 5.25mm of which would go to Torchlight as per the working interest agreements (see figures below). The Company believes that this opportunity by itself represents over $440mm of potential revenue and in excess of $100mm of potential net income.

 


Corporate Timeline

September 24, 2014 - Announced closing of acquisition on 168,000 acres in Orogrande Basin Project in West Texas

March 30, 2015 - Began drilling first well in Orogrande Project

June 10, 2015 - Announced closing of $9.8 million private placement effectively eliminating senior debt

June 16, 2015 – Company regained compliance on NASDAQ listing

July 13, 2015 - Confirmation of scientific results for first Orogrande Project well – Undisputed Core Results

September 9, 2015 - Signed LOI for $50 million farm-in agreement on Orogrande Basin asset

September 15, 2015 - Signed farm-out agreement on the Marcelina Creek Project in Wilson County, Texas, with PetroBridge Energy, Inc.

September 29, 2015 – Entered definitive agreement with Founders Oil and Gas

September 30, 2015 - Announced the closing of $3.7 million preferred stock issuance

November 5, 2015 - Entered definitive agreement with Husky to sell a portion of Hunton assets – relieving over $2.8 million in debt and receiving over $1.4 million in cash - $900,000 in January

November 19, 2015 – Signed an agreement for Goldstone Energy to participate in Marcelina Creek for 10% working interest.

 


Leadership

The knowledge base of Torchlight's executive management team and board of directors includes all aspects of the business, including: operations, mid-stream, capital formation, purchase and sale of assets, re-entries, investor relations and oil and gas consulting for public and private companies.


John A. Brda - President, Chief Executive Officer, Secretary and Director

Mr. John Brda has served as Torchlight's chief executive officer since December 30, 2014, as well as president, secretary, and a member of the board of director since January 2012. Since 2002, he has been the managing member of Brda & Company, LLC, which provided consulting services to public companies - with a focus in the oil and gas sector - on investor relations, equity and debt financings, strategic business development and securities regulation matters.

 

Willard McAndrew III - Chief Operating Officer and Director

Mr. Williard McAndrew has 43 years of experience in the energy industry, from field operations to refining. From December 2006 to September 2013, McAndrew served as chairman of the board, CEO and president of Xtreme Oil & Gas, Inc., a company engaged in the acquisition, operation and development of oil and natural gas properties located in Texas and the southeast region of the United States. Additionally, since April 2013, he has served as a consultant to Torchlight. He began his career in 1969, gaining experience working for Hercules Drilling Company as a roustabout in South Louisiana. He attended Louisiana State University and then spent two years in the United States Marine Corps. Later, he joined Exxon Corporation Refinery's Distillation and Specialties division in Baton Rouge, Louisiana, becoming the fourth generation in his family to work for Exxon. McAndrew has served as president and owner of several small companies that were involved in all phases of the oil and gas business from drilling, reworking, completion, leases, etc. He has also been a consultant since 1990 to companies and is responsible for the structure, formation and marketing of partnerships and energy financing.

 

Roger N. Wurtele - Chief Financial Officer

Mr. Roger Wurtele is a versatile, experienced finance executive that has served as chief financial officer for several public and private companies. He has a broad range of experience in public accounting, corporate finance and executive management. Wurtele previously served as CFO of Xtreme Oil & Gas, Inc. from February 2010 to September 2013. Since May 2013 he has worked as a financial consultant for Torchlight. From November 2007 to January 2010, Wurtele served as CFO of Lang and Company LLC, a developer of commercial real estate projects. He graduated from the University of Nebraska and has been a certified public accountant for 40 years.

 


Torchlight Energy Resources, Inc.
5700 W Plano Pkwy #3600
Plano, Texas 75093
Phone: (214) 432-8002
www.TorchlightEnergy.com

MissionIR
3645 Marketplace Blvd., Suite 130-280
Atlanta, GA 30344
Phone (404) 941-8975
www.MissionIR.com
[email protected]

 

MissionIR is a moderator of this board. Please see disclaimer on the MissionIR website: http://disclaimer.missionir.com

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#217   First stage of fracking went well. I don't Rumi21 02/21/17 10:51:53 AM
#216   stock needs to hold the 1.80s to show TrendTrade2016 02/18/17 08:44:48 AM
#215   They have a lot more to prove before Rumi21 02/16/17 09:19:58 AM
#214   On our way to $15 when this company Southern Gal 02/15/17 07:43:37 AM
#213   daily bands opening so this should fare well TrendTrade2016 02/15/17 05:35:28 AM
#212   Thoughts on trch? thenextbigstock 02/10/17 08:51:11 AM
#211   Item 1.01 Entry into a Material Definitive Agreement. Southern Gal 02/05/17 08:28:14 AM
#210   Orions hasn't discovered anything. It's just an individual Southern Gal 02/05/17 08:26:27 AM
#209   This is why this stock has appeal: TrendTrade2016 02/04/17 06:54:05 PM
#208   Ok Found it under Current filings. Has to Rumi21 02/04/17 02:12:36 PM
#207   Any one familiar with news item from Reuters Rumi21 02/04/17 01:09:20 PM
#206   Southern Gal, ORIONS-Money-Stocks has discovered TRCH. They started SF Wolf 02/04/17 12:51:18 AM
#205   Why all of the post market trading today? Southern Gal 02/03/17 11:03:22 PM
#204   TRCH the next big oil play TrendTrade2016 02/03/17 06:51:05 PM
#203   TRCH taking off today Southern Gal 02/03/17 11:38:57 AM
#202   TRCH Noble Conference Presentation 1/31/17 SF Wolf 02/01/17 03:23:54 PM
#201   Another excellent day; both in terms of % Southern Gal 01/28/17 11:52:43 AM
#200   triple top break with 1.81 trigger to 2.46 TrendTrade2016 01/27/17 02:44:18 PM
#199   I first read about TRCH over at 321Energy SF Wolf 01/26/17 08:00:45 PM
#198   Probably has a lot to do with CWEI Southern Gal 01/26/17 07:54:02 PM
#197   Other TRCH message boards are comparing TRCH to Southern Gal 01/26/17 07:46:13 PM
#196   Southern Gal, any idea that explains today's up move? SF Wolf 01/26/17 04:07:20 PM
#195   Closed at the high for the day Southern Gal 01/26/17 04:01:54 PM
#194   Torchlight Provides Operational Update for Permian Basin and Southern Gal 01/23/17 09:33:06 AM
#193   Too late for that! Got in at charliewho 01/22/17 04:43:10 PM
#192   NP anytime...just watch for a bit and see TrendTrade2016 01/22/17 03:00:25 PM
#191   Company News Torchlight Energy to Participate at the Noble thenextbigstock 01/22/17 01:59:41 PM
#190   Thanks for your insight!! Much appreciated charliewho 01/22/17 01:44:39 PM
#189   yes but only to confirm support. we want TrendTrade2016 01/22/17 01:40:54 PM
#188   Interesting. So the chart resistance is more for charliewho 01/22/17 01:31:28 PM
#187   1.75 is candle resistance and 1.81 is chart TrendTrade2016 01/22/17 01:29:23 PM
#186   TT, not to call into questions for skills..... charliewho 01/22/17 01:26:24 PM
#185   TRCH beautiful set up. Shorts are heavy here TrendTrade2016 01/22/17 06:58:20 AM
#184   Southern Gal Hi there. You seem to have thenextbigstock 01/21/17 08:08:11 PM
#183   The Energy Report Examines the Predicted Rebound of Southern Gal 01/20/17 09:16:12 AM
#182   Torchlight Energy Southern Gal 01/19/17 05:03:24 PM
#181   Up over 10% today. Southern Gal 01/19/17 02:40:42 PM
#180   Torchlight Energy Resources, Inc. (NASDAQ:TRCH) shows optimistic Trends risingup58 01/19/17 11:42:27 AM
#179   Testing 52 week high of 1.75. No risingup58 01/19/17 11:41:08 AM
#178   Southern Gal Hi there. You seem to have a thenextbigstock 01/18/17 09:51:57 PM
#177   Looking good here. Southern Gal 01/18/17 10:52:00 AM
#176   Yes looking good for who this company is, risingup58 12/14/16 12:31:11 PM
#175   Strong day. Looking good Starkridesabull 12/13/16 03:59:38 PM
#174   Torchlightenergy latest "investor presentation" risingup58 12/04/16 11:10:25 PM
#173   Drilling a 2nd well in early Jan. risingup58 11/28/16 10:36:11 PM
#172   Torchlight Energy Resources, inc. Is in the heart risingup58 11/25/16 09:51:57 PM
#171   Permian Land Rush. risingup58 11/25/16 02:43:41 PM
#170   The largest oil deposit ever found in America risingup58 11/22/16 11:43:51 AM
#169   Break 1.45 then 1.57 next. Chart looking good. risingup58 11/22/16 07:18:40 AM
#168   $TRCH Torchlight Enters Letter of Intent to Increase $Pistol Pete$ 11/21/16 10:52:15 AM
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