I am in this for the long run as well. Whether MMTE sticks with acquiring interest in already producing wells which provides a faster influx of revenue or starts drilling their own wells again does not matter. Both will produce positive results for the company.
In their latest PR, MMTE stated they acquired a 3.75% working interest in 7 Pawnee County Wells that produce a better volume. (Their original working interest was 5% in one well that produced 7-10 bbl per hour - Now it is 3.75% on 7 wells) If we assume these wells all produce 5 bbl per hour (conservative I hope) around the clock, that is 120 bbl per day times 7 = 840bbl per day. This equates to 25,200 bbl per month. At $100 per bbl crude = 2.5M total revenue per month of which MMTE gets 3.75% = $95k per month for MMTE (less expenses). Not bad for just acquiring a working interest in already producing wells. (Of course I am just guessing on production numbers but the PR does indicate higher producing wells)
It also appears that they may acquire a working interest in 4 additional wells in Pawnee county - again more revenue.
It is not clear what they paid for acquiring the working interest but it will pay off in the long run. In addition, revenue will improve once they get their own 60 wells up and running.
The Mid October PR with production numbers is what we need to see to better evaluate the value of this stock currently and in the future.
IMHO this stock has great potential, however, it is going to take some time to get there; probably several years. Plus, I am strictly talking oil here - who knows how much revenue would be added for gas as well.
Does anyone know if the working interest is strictly 3.75% of Oil or perhaps Gas as well?
AI
