Stratex Oil & Gas Holdings Inc (STTX)

[PlatypusRx]

Whiting has a major discovery. They are flaring gas, a lot of it. They have installed very large holding tanks -- it looks like about 10K bbls worth. They have applied for a permit for a processing facility. The rumor is that this well could set records. STTX owns a 3% interest in the discovery well and 5% interest in the surrounding 150 or so locations (the JV is 20K acres). STTX also has (or will have, when it exercises its lease options) a 100% WI in about 20K acres to the north and west of the JV acreage. According to STTX management, they have about $6MM in cash, which should be more than enough to participate in the next couple wells in the Whiting JV. Whiting has permitted one such well about 2 mi. north of the first (that much closer to the STTX acreage). What it means is that STTX's proved reserves are about to take a big bump upward, by several times its current market cap. And because this is a shale play (basically, a big slab rather than isolated traps), it's very likely that many of the other STTX locations -- more than 100 in all -- are going to be productive. News is going to come out in the next few days and weeks that radically changes the market's view not just of STTX but Whiting itself. Developments at the well site have been kept under wraps while the JV partners quietly gobbled up acreage. Now they're done. Whiting could have as many as 350 square miles under lease. Now that Whiting has committed to raising $2B in a public offering, expect the cat to come racing out of the bag in a big way.