Universal Energy Corp (UVSE)

[Ben Bien]

In considering the facts presented below, I would argue that it is highly probable for UVSE to strike profitable wells at its Lone Oak property. The company's Chief Exploration Officer has significant experience in the resource exploration business, and must have applied geophysical methods towards the prospect area of Lone Oak. In addition, the company claims that they are "targeting the same Vicksburg sandstone reserves responsible for producing 4 trillion cubic feet of gas and 4 billion barrels of oil in this area since 1900." Given that the U.S. has reached peak oil production, this area does not have as much oil as areas located in countries that are just beginning to tap their oil reserves. However, that does not mean that the company will find nothing. The fact that they are drilling in this area must entail that they had performed exploration efforts to previously justify their drilling in that area. With a high probability of striking profitable oil or gas on or around July 12th, and given the unusual circumstances of UVSE stock having declined significantly in price, it is more likely that UVSE will show HUGE gains from its current level. (SEE FACTS & CITATIONS BELOW)

Facts:

1.) Universal Energy Corp. has projected that it will complete drilling operations at its Lone Oak property on July 12th, 2008.

(SOURCE: http://www.tradingmarkets.com/.site/news/Stock%20News/1730862/)

2.) On May 28th, Universal Energy Corp. CFO Dyron Watford projected: "revenues are estimated to be within the range of $0.25 million to $0.3 million for the 2nd quarter 2008 and our range for 3rd quarter 2008 is $0.8 million to $0.9 million. This guidance for the second and third quarter 2008 represents an increase of approximately 217% and 882% as compared to first quarter 2008"

(SOURCE: http://sev.prnewswire.com/oil-energy/20080528/CLW06228052008-1.html)

3.) Kevin Tattersall is the Chief Exploration Officer of Universal Energy Corp., and "has over 25 years of experience in the resource exploration business with the last 10 years being focused on the oil and gas industry. Mr. Tattersall's resource exploration experience began in the late seventies where he worked for many years in the field as a geophysical/ geochemical exploration consultant for various mining companies."

(SOURCE: http://sec.edgar-online.com/2007/04/17/0001193125-07-081911/Section15.asp)


Disclosure: I went long with $5,000 worth of shares on July 3rd when UVSE was priced at $0.019. I then sold half of my position on July 7th at $0.034 for a gain of about $1,500. I held onto the other half on July 8th despite the decline, and I have added further to the position such that today I hold 337452 shares of UVSE at a cost basis of $0.019. I intend to sell all of my UVSE shares at $0.03.