Intrinsic value can be difficult to spot to the untrained eye; but once you get the hang of it, you start seeing untapped opportunities all over the place – literally.
Take my latest pick for example. Since the start of the year PEII has been presenting one extraordinary development after the other. Over the last few weeks two important developments have come out which I think bumps up its intrinsic value significantly.
The first was news that PEII has started drilling operations at its Gerner Trust Leases with a total of two new wells coming into production. At the time of the announcement the company said drilling would start mid-September.
The other big news was releases in September when the company revealed some interesting production numbers. According to PEII, monthly production rose 300% from June 2014 when the company announced a monthly production of 149 barrels of oil. PEII said July saw 361 barrels and August saw 482 barrels.
Obviously with these production numbers PEII can do better than the current trading price of .0003 – and herein sits the opportunity.
As a triple-zero opportunity PEII is saturated with upside potential. The play has very healthy volume and daily liquidity is sky high.
The bounce potential is well defined around a set of technicals that just scream upside. Quite frankly, this is poised for one-directional movement and I think you’ll agree once you dive into the numbers yourself.
Start your research ASAP.
Investor Highlights
PEII’s RSI of 35 shows just how much bounce potential is wrapped up in the play.
PEII has seen steady increases in oil production from its drilling operations. June 2014 saw production of 149 barrels of oil whilst August saw an increase to 482 barrels.
PEII has announced drilling operations at its Gerner and Gerner Trust Leases. Projected initial production was set at 45 barrels of oil per day
PEII is well poised to increase its growth potential from the current oil and gas boom occurring in Texas.
PEII also has a production sites in Oklahoma, one of the largest oil producing states in the US.
PEII has seen more than 200% added to lower valuations and the play has seen a strong build-up of support.
About PEII
PEII (Petron Energy II, Inc.) is a Dallas-based, oil and gas exploration and production company.
PEII continues a tradition of developing oil and gas properties in low risk areas with years of proven production history.
PEII’s owns several oil and gas leases in Oklahoma and has been making significant progress with its drilling and production activities across several wells.
PEII has as its target market, the Woodford Shale in Northeast Oklahoma and the Tannehill Sand in Texas, each offer high success rates and the potential for long term cash flow.
Texas Oil and Gas Hits Its Golden Age
James Lebas, former chief revenue estimator for the Texas Comptroller’s office, made news recently when he told the state’s House Committee on Energy Resources that, working with the Comptroller’s office, he had determined that output from the oil and natural gas industry now accounts for fully one-third of the entire Texas economy. Given that the Texas economy would rank 12th among all nations on earth, that’s an amazing amount of economic activity for one industry to provide.
Yet, it should not surprise anyone who has really been paying attention to the phenomenal boom the industry has undergone in Texas since 2010. As Lebas, who now works as a tax and fiscal consultant in Austin, told me when I spoke with him last week, “It’s best to recognize you are in a golden age while you’re in it.”
Or, as he told the Energy Resources Committee, “When people look back at this in 20 years, this will be seen as part of the golden age. We have reached new highs, it is paying handsome dividends to the state and the state is doing very well. We’ve gone from one million barrels a day to three million, and the day may come when we eclipse the all-time record set in 1972.”
The story of this Golden Age gets even better when one looks at where a ‘Nation of Texas’ would rank when it comes to oil and gas production: Texas would rank as the 8th largest oil producing nation and the 3rd largest natural gas producing nation on earth. Granted, Texas is a big ‘ol state, but still, that kind of natural resource production is pretty amazing from any perspective.
The most recent Federal Bureau of Labor Statistics data indicates that, while the nation’s economy continued to struggle over the last year, Texas was adding more than 1,000 net new jobs every day, more than 390,000 for the most recent 12 month period. By contrast, California, which has highly restricted the growth of its own energy production, has added just 322,000 net new jobs in the last five years combined.
The state’s unemployment rate of 5.1 percent was a full point below the national average. Indeed, a recent report from Bernard Weinstein, Associate Director at the Maguire Energy Institute at SMU showed that Texas has accounted for fully 35% of the nation’s job growth since the year 2000.
Lebas pointed out to the Energy Resources Committee that jobs in the oil and gas production sector rose above the 400,000 level last year for the first time, at an average wage ($125,000) that is three times the state average. Tax collections from the industry via the sales and production taxes exceeded $13 billion during 2013, and will be even higher this year.
Recent Developments
Petron Energy II, Inc. Announces Increasing Trend in Its Oil Production
Petron Energy II, Inc. post largest monthly production jump year to date with August results
DALLAS, Texas, Sept. 11, 2014 (GLOBE NEWSWIRE) -- via PRWEB - Petron Energy II, Inc. ("Petron II" or the "Company") (PEII) Petron Energy II, Inc. reports increasing trend in its oil production.
Petron Energy II, Inc., together with its subsidiaries, engages in the acquisition and development of properties for the production of crude oil and natural gas, the transportation of natural gas through its pipeline subsidiary and well servicing through its servicing subsidiary. The Company's operations are based in the United States.
This morning Petron Energy II, Inc. announced that it posted its largest year to date production month in August with 482 barrels of oil sold for the month. The company has been focused on improving its production and their monthly production has been trending higher since June. The company reported that monthly production for June was 149 barrels, July was 361 barrels and August was 482 barrels representing better than a 300% improvement in its monthly production since June.
Floyd Smith, President and CEO of Petron Energy II, Inc., states, "We are very pleased with our production results and as we progressively implement more of our development plan we estimate that this current trend should continue."
The company announced in its August 28, 2014 press release that it will begin drilling operations on two wells this month, one new well on its Gerner lease and a second new well on its Gerner Trust lease.
Petron Energy II, Inc. believes that offsetting its Gerner #2 well which had an initial production rate of 45 barrels of oil per day and the Gerner Trust #1 well which tested over 1.5 million cubic feet of gas per day could if successful, assist in extending the current upward trend of monthly production. Drilling is scheduled to commence Monday September 15, 2014, both wells are expected to be drilled and logged within one week.
Floyd Smith goes on to say, "We are very excited to have another opportunity to drill on both leases; each lease provides the potential for tremendous upside and production growth."
The company has set a goal for itself to increase its daily production rate to an estimated range of 110 - 120 barrels of oil per day within 90 days and it believes these wells could be important components in achieving the goal. The company will report results as soon as they are available. Start your due diligence today.
Have you seen a better positioned or more undervalued play in the oil and gas space recently? I certainly haven’t and this is why I think you should be all over PEII.
It won’t be a triple-zero opportunity for much longer given these fundamentals and technical setup.
Start some research on this gem as soon as you can.
I would bet a lot of money that this one is being paid for by the MM's. Even the toxic financiers are probably starting to sweat the terms at these prices.
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