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I interpreted the "Coming soon" quite a bit differently then you: First, we know things are coming soon from the newsletter and press releases (what's next and when? I don't know exactly - but this company has quite a bit in the works). Second, in this industry, and considering the projects this company's working toward, SOON could be 2 - 3 months or 1 - 2 years. IMO this is a long term investment and the "Coming soon" post was just another indication to read the newsletter and press releases to keep us long term investors happy. But I could be wrong - wouldn't be the first time.
I agree. Having investigated the RJE process, I know the post-treatment (acidizing, propant placement with a mini-frac, etc.) can be just as important as the jetting of the short horizontal sections. My guess, based on the last newsletter statement about subsequent treatment, is that they evaluated the process for a short time without post-treatment and are now trying to line-up a post-treatment. I'm assuming with this formation they are going to hit it with an acid treatment. Again, I'm also interested in some feedback about the results or current status.
WYOPETRO
CowboyUp5000
I can't really say what the acreage acquisition will do to the stock price - as rrufff stated very well the stock price is determine by supply and demand for the stock itself. However, you can make an estimate of the raw acreage value and thus the value per share to the stock (based on total number of outstanding shares).
Here's one approach to doing this estimate:
1) Visit the Utah BLM mineral lease website at http://www.ut.blm.gov/wh3oandg.html. 2) Look at the last one or two historical lease sales and find acreage sold in the Uinta Basin. 3) Then look a the lease sale results for acreage located in the Uinta Basin and take an average of the cost per acre (this value may have to be adjusted down, say by half, since only the deep rights are being considered). 4) Finally, multiply that value by the prospective 8000 acres NNYG is looking at acquiring. 5) Divide that value by the number of outstanding NNYG shares.
This will give you a ball park number of the raw acreage value in a $ per stock perspective.
Good luck - let me know if you have any trouble with this research (you'll have performed your first mineral valuation).
WYOPETRO
CowboyUp5000,
I imagine these are not easy questions for Jon to answer at this point - but let me give you my perspective, whatever that's worth:
First let's assume everything goes well and these deep rights are acquired. Deep wells are expensive and take time to drill - and some of these may be dry holes. But the best way for a small company like NNYG to develop a play like this and minimize dilution and risk (which, from what I understand, is a big priority to Jon) is to partner with a bigger company (access to money and rigs) and retain a carried working interest. That's why I made such a conservative assumption about the acreage developed (10%) to account for a "partnership" of some sort. Jon has good connections in the industry and, IMO, he will have no trouble arranging a creative solution.
Next, these deep wells are not going to be worth drilling unless there is a least 1 BCF reserve potential (that's why I used that number as a minimum). Once a successful well proves up some reserves (in many cases, all it takes is one) that's when the proven undeveloped reserves generally make a difference to the stock price. But remember this business is not about manufacturing widgets - it's about taking risks and potential upside - people speculating on this upside can also move the stock price even before the first well is drilled.
WYOPETRO
Creede - my shares are way in the red too, but I'm holding long - IMO there are some good things in the works here.
WYOPETRO
IMO NNYG needs to focus on the Uinta and/or Muddy to move this stock beyond a $0.025 to $0.05 stock. I would have to disagree with your management philosophy of concentrating only on the current leases in Texas and here's why:
If you take the Benoit lease for example and look at average lease production from the seven wells, you find that these wells (on average) were not "barn burners" to begin with (2-3 BOPD) - some may have produced more some less, but historical records are only available for the lease as a whole. If you look at the best results from the RJE process from the RJE company's hostorical data, the best this process will do on these leases is get the wells back to 2-3 BOPD producers (if you compare that to what their doing now that's about a 20x increase or adding 62% to recoverable reserve with a PVR of 1.5). While this is economic from the project standpoint, these type of reserve increases, for all the Pecos leases, only add about $0.025 to the value of the stock (doesn't the market has a wonderful way of determining price).
Now let's look at what the potential acquisitions (Muddy and Uinta) can do to the stock IF they come through:
Muddy - if you only drill 8 wells of the 40 or so stated in the press release and these wells only produce 200,000 mcf recoverable reserves, that adds about $0.10 to the value of the stock.
Uinta - if you only drill 10% of the 8000 acres on 40 acre spacing (see development in this basin from any major player EOG, Questar, Gasco) that's 20 wells. At a conservative 1 Bcf per well, that's 20 Bcf recoverable, which adds about $1.33 value to the stock.
Now if you managed this company, which project would you be spending most of your time on? If it were me, the Uinta would be top priority, Muddy 2nd, and current leases 3rd. Now it is still speculative that the Uinta and Muddy may go through - but IMO the potential is great and for a pinksheet stock NNYG has great potential for future growth. So, if investors can handle a little price movement and risk, you may want to hang on to your shares. If you don't like the risk you may want to try a different investment.
Creede,
Those selling now are going to be crying later. Those buying now and holding will be laughing at those that sold out at these prices. Why would I buy 500,000 at 0.039 when I can buy 750,000+ at these prices! Working good deals in this industry takes time and patience.
WYO
I'm with you...who wouldn't add more shares at this price level. As the newsletter stated, there are some great things in the works here.
IMO 300k more would be a good investment at this price!
I think this stock is worth a little speculation at this price. I'll be adding - if the technology is legit, this company should do well in the long run.
Have no idea - thought the guy at least needed a reply to feel welcome on the board.
Never did either. Saw Hellfighters - great tribute to our industry - part of it filmed just down the road here in WY.
Heard they filmed broke back in Canada - probably couldn't find any locals here to help out with Cowboys of the other persuasion (is that PC enough for this board). LOL.
For every 10 o&g opportunities I look at only 1 may develop into something. I don't think the concern was intended as flack, just that we hear about the one great solid opportunity verses many good possible ones.
I think Jon is doing a great job keeping us generally informed. IMO, I think we need to wait for the solid opp. to hear specifics (where, when, etc.).
WYOPETRO
I agree that a little dilution is not a bad thing. The big question is whether the technology is legit - let's get this test plant built in New Zealand so we can see some results.
Over the past month the number of outstanding shares has changed from 80,255,619 to 97,455,619. Restricted shares remain the same at 55,186,410.
Many groups try to spin the environmental impact side - make it look like development in the area will be devastating (in very, very, few cases is it devastating). But look closer...this group even says it - the Uinta Basin holds 16+ Tcf of gas (estimated when this was published in 2004), which can supply the entire US for almost a year - that's huge when you think about the size of the basin compared to the size of the US. Today, o&g development is held to high reclamation standards - especially on federal acreage. There will always be some development impact, but the question should be about cost-benefit. And obviously with the amount of gas, number of jobs created, tax revenue generated - generallly the minimal and short term impact is more than offset by the other benefits of development.
With a name like CowboyUp, I wouldn't expect anything less than goin' out on a limb. I equally appreciate your candidness and tactfulness in addressing the newsletter concern. As I said, I agree.
WYO
I agree!
futrcash - Thanks for the post. Good thing SDRC has maintained a conservative approach to calculating project economics. Bill Brown has continued to use $400-$500 per oz pricing for gold and has conservatively estimnated recovered tonnage and production timing when running economics. In addition, this years extraction costs should still be very close to the $190 per oz.
Compared to many other pinksheet gold companies I have seen, SDRC has good assays, environmentally sound practices, excellent local community support, and will be in production this spring/summer. From what I understand work should begin within the next few weeks.
WYOPETRO
clickclack and Creede,
Thanks for the kind comments. I'm doing what I can, using my experience in the o&g industry, to help NNYG and add value to our company - IMO this company has a great team and future. For the record, I'm doing this all as an interested stockholder - I have received no compensation for my technical analysis and recommendations provided to Jon or other NNYG staff. As a stockholder, my primary concern is adding value to the company - I will continue to do my best to move us to a $1 per share stock!
WYOPETRO
Hi Creede,
No worries - all questions are welcomed on this board. With the current number of outstanding shares it will only take 2.8 Bcf of gas to add approximately $0.20 of value to the stock - that's not much. IMO this Uinta acreage has the potential to do that easily - a detailed geological review will help quantify viable prospects.
WYO
clickclack,
In some cases, for many different reasons, companies will only lease the shallow mineral rights from surface to some depth. This leaves the deep mineral rights still available for lease from that depth down. Are these rights better? Well in deeper formations more gas can be compressed into the same space due to the higher pressure. However, the same things are needed in either the shallow or deep case to make a successful economic play: 1) hydrocarbon source, 2) reservoir rock, 3) hydrocarbon trap, and 4) a sufficient volume and ability to produce that hydrocarbon in a timely manner.
In this area we know there for sure is a source and reservoir rock. The Conoco wells Jon mentioned had good "shows" and in an 8000 acre area there is very good potential for the other components: trap (structural or stratigraphic) and quantity and deliverability. A detailed geologic evaluation will help identify these prospects. The Uinta Basin is a great area to be in right now - new technology has opened up many opportunities that were by-passed years ago. This is an exciting opportunity for NNYG!
WYOPETRO
8,000 acres is a significant acreage position - we're talking 12.5 Sections of land! This is the type of acquisition that can move NNYG to the next level. Remember, this is deep rights only; however, the Uinta Basin in many of the deep formations has been relatively unexplored and unexploited in these zones compared to the neighboring basins in CO and WY (ie Piceance and Green River). At this point no specific information has been released. Once the acquisition is completed, a detailed geologic review will need to be initiated to develop specific development prospects over this large area. Let me put this in perspective compared to neighboring basins - one successful well in this area at these depths could easily produce 1 - 3 Bcf of gas. The Uinta basin has become a major area of interest in the industry - just look at any publication that summarizes o&g activity.
WYO
In addition, for the gas injection project they have 18,600 bo/acre - if you assume a 30% recovery (which I think is good a good estimate) that's 5,580 per acre recoverable. Just using the 16 Ownbey wells on 10 acre spacing and an in-the ground oil acquisition cost of $18 per bo recoverable that is:
5580*16*10*18 = $16,070,400 value / 300,000,000 shares outstanding = $0.05 per share.
Just the Ownbey wells value this stock at $0.05 per share!
WYOPETRO
I cannot say anything specific; however, as stated by Jon in the newsletter, a Casper based company and NNYG are interested in forming a working operator/partner-type relationship - for opportunities that MAY be available in the Rockies. This is true and the company and personnel are top-notch.
I do know MANY possible opportunities are being discussed. As we know, in this industry, many opportunities are usually discussed before a suitable and economic project(s) is chosen to pursue.
I will tell you NNYG does some of the best project DD that I have seen, using both company and outside resources. IMO this company holds shareholder value in very high regard and you should expect, WITH PATIENCE, only the best projects to emerge from NNYG.
WYOPETRO
americano - hang in there. IMO this stock will do well in the long run. I spoke with W2 - before construction of the Ontario plant begins, they are building a pilot plant at Drexel University in PA - this is near completion. The Ontario plant will be the first commercial scale plant. They will be using an existing building, which they currently have an agreement for - and since the process does not have emissions like a traditional power plant the permitting process is very simple.
As for the core technology patent numbers - these will be posted on the website as the site is completed. We can then cross check these with the US patent office.
WYOPETRO
W2 Energy Inc. Receives Letters of Request for Production Quantities
NEW YORK, May 8, 2006 (PRIMEZONE) -- W2 Energy Inc. (Pink Sheets:WWEN), a developer of green energy, is pleased to announce it has received letters of request for diesel samples from several large European re-sellers of diesel fuel. The letters request a total production of 3,360,000 metric tons or 25,200,000 barrels of diesel per year, representing a total dollar value of US$1,512,000,000. In order to fill these orders the company will construct a minimum of seven 10,000 bpd plants throughout the Continental U.S. and Canada. Mr. Michael McLaren states, "We have begun the process of marketing our product and have had outstanding results." He also states, "The Company has been working on the long term financing of these projects and is cooperating with some large project finance firms to bring these plants to fruition."
New W2 website is up and running - looks like they are still adding info on the technology side - hopefully over the next day or so this info will be available. Much more professional than the last. It would be nice to see some management profiles.
Napolion - now we're getting somewhere! Thank you for your work on this and it would be interesting to see exactly what the specifics are on these core patented technologies that seem to be so efficient.
WYOPETRO
hapacrazy - Welcome to the board and thanks for the professional input. I will post my planning DD info when available. The more specifics we can get the better.
WYOPETRO
Napolion – It’s unfortunate you are spending so much time and energy posting on a stock you have no interest in owning. Unless you’re willing to provide some hard facts through some good DD to help interested parties on this board, I suggest you take your fact-less bashing to another board - otherwise your wasting board space and investor's time. If you want to provide meaningful input to this board post some hard facts based on the technology – you obviously don’t have any specifics. If you can’t get specifics after contacting McLaren, then that’s another story.
I WILL contact the city planning office, make an effort to get some hard facts, and post my findings. IMO if the appropriate site plan has been submitted and construction permits granted – this is a good start to proving the legitimacy of this stock.
As far as the AMEX claim goes – I agree they have some way to go before meeting the requirements. Let’s see what the financials have to say – again, that will provide some facts that we can use to start forming opinions and make good investment decisions.
Napolion - IMO you may be misinterpreting the following:
"Unlike typical plasma reactors that utilize convection of the intense heat produced by the plasma, our GAT reactor can amazingly produce enough Syngas (H2, CO) to feed a 10,000 barrel per day synthetic diesel plant and 100 Megawatt steam turbine with a mere 4 MW input."
I think what the statement is trying to say, although not very well, is that 4 MW of additional energy input is needed to drive the carbon mass reaction within the reactor. As we all know the carbon mass (coal, oil, garbage, or crap) contains energy - the statement does not indicate how much carbon mass is needed to produce the 10000 barrels of syndiesel or the 100 MW.
Your investigation of the patents should provide some useful information about the process.
WYOPETRO
When you contact McLaren (416) 246-1100, I will be interested to see his comments. Your technical expertise will benefit us all when you get the patent numbers for some DD - this may explain quite a bit.
I will call the city planning office next week and provide any info I get on this board.
Working together we can uncover some hard facts. Thanks for your input.
WYOPETRO
SDRC's new website provides operations and financing updates - see http://www.sidneyresourcescorp.com/
Looks like production is still on schedule to begin this spring/summer 2006.
WYOPETRO
Napolion - I agree the website is not very professional. When I spoke with McLaren he said a new website was on the way.
Two ways to do some in depth DD is 1) call the city planning office in Guelph, Ontario (519) 837-5616 - see if anything has been filed to build the plant - you would think for a plant like this they would have something filed by this point. 2) Call McLaren and get some patent numbers - then run then on the US Patent Office website to see if they match (unfortunately searching W2 Energy or World Wise Technologies may not turn-up anything because the patents list the original assignee not current).
If you find out anything, please share in a post.
WYOPETRO
CowboyUp5000,
From what I understand they are doing two of the better wells and then will evaluate the results/economics. If results are promising they have 26 wells listed on the website under asset portfolio - many completed in the same formation on the same or nearby leases - almost all should be candidates for the RJE process.
Also the newsletter mentioned the possibility of acquiring a small company with more wells in this area and a workover rig/crew. If/when this deal is complete, I think there will be more RJE candidates.
The RJE process is like drilling several mini horizontal wells, which enable you to tap into undrained reservoir very economically. A recent article in the Jan 2006 issue of Oil and Gas Investor talked about the great potenial in the far west Texas - NNYG leases are right in the heart of this area. Check out the article if you get a chance - gives a great review of recent developments in West Texas.
WYOPETRO
Conservative NNYG valuation with Muddy acquisition:
Assumptions:
1) low end recoverable reserves of 200,000 mcf per well
2) only drill 20% of the project (16 wells)
That gives 3.2 BCF. Based on my previous analysis it would only take 2.5 BCF to support a stock price of $0.20 per share.
IMO this stock is very undervalued at $0.04-$0.05 per share.
WYOPETRO
ezmony,
IMO you're right on - with the gas volumes in storage and prices where there at now this is a good time for a gas acquisition. I suspect storage volumes will be drawn down this summer, and assuming a normal to colder winter, there will be excellent support for higher natural gas prices by the time this project starts producing.
WYOPETRO
For background DD on the GCHR wells check out the following website:
http://www.kgs.ku.edu/Magellan/Qualified/index.html
Looks like these wells are on 10 acre +/- spacing, which for the existing wells (15 Ownbey and 7 Troyer) gives reserves of 1860 bo/acre * 22 wells * 10 acres = 409,200 bo recoverable, which adds $0.027 to the share value. Add-in the upside drilling potential on these leases (does anyone know how many wells that is?) and that could add say $0.05 to $0.10 a share.
If either GCHR or NNYG is trading below $0.10 a share - IMO they are a buy!
WYOPETRO