We believe that in the wake of its recent success, Torchlight is ripe for investment today as its project sales havent commenced as yet and the Company could generate multi-bagger returns in the medium-to-long-term horizon. Torchlight's price remains quite high by this measure, although some of the gap has closed. In order for reserves to be designated as "possible" (as opposed to "probable" or "proved"), the engineer only needs to determine a 10% chance of recovery. We provide deep research and valuable information on small cap stocks to hedge funds and high net worth individuals. Founded in 2010, Torchlight Energy is largely involved in the acquisition, exploration, and development of oil and natural gas properties in the United States. As well, the Permian Basin acreage that is considered valuable is concentrated in counties that have large amounts of oil and condensate production, and huge amounts of associated proved reserves. Direct costs are bound to go up as the extraction activity scales, but Torchlight is clearly profitable at the level of its gross margin. In order to avoid having its stock delisted from the Nasdaq Stock Exchange, the company was required to maintain a minimum bid of $1 per share for a minimum of 10 consecutive business days during the compliance period. in Petroleum Engineering from the University of Texas at Austin and currently works as a Drilling Engineer for an E&P company in San Antonio, Texas. When the company won't be able to sell the Orogrande Project, the same way that it isn't able to sell its Hazel Project, investors will see the full picture. APN #s 118-03-22909, unit 1, block 111, lot 11 Annual taxes $32.91 Recreational Vehicles (RVs) are allowed as follows: A. Despite that, the prices of some shale plays has held up, the Houston Chronicle reported. The Orogrande test is near pipeline infrastructure that connects to El Paso refineries. Please disable your ad-blocker and refresh. Torchlight's stock closed at $0.80 on November 7, 2018, and reached its low of $0.53 on December 31, 2018. Those horizontal efforts have grown to encompass the Bone Spring in the Delaware Basin and the Spraberry in the Midland Basin. These calculations tend to mention the value of prime Permian Basin acreage when discussing Torchlight's Orogrande Basin acreage. Find out more about how we use your information in our privacy policy and cookie policy. Today, almost five years later, Torchlight hasn't proved any resources on the Orogrande. The price per acre for the Midland Basin was about $17K. Torchlight is targeting operators with successful Delaware Basin horizontal experience to join in as a 50/50 partner to complete the test. Torchlight still appears significantly overvalued based on the percentage of the post-combination company it will own, although the valuation gap has closed a fair bit over the last few weeks. (around 160 to 180 barrels per day with an almost 15% load recovery). It currently has interests in four oil and gas projects. The Company has recently been in the news for striking oil in its largest project in Orogrande and the potential amount of the oil extracted could be as much as 3.678 billion barrels. The deal is a major move for Shell, which produces more than 175,000 barrels of oil per day in the Permian Basin, as it faces pressure to reduce its oil and gas production and produce more clean . By clicking Accept all you agree that Yahoo and our partners will process your personal information, and use technologies such as cookies, to display personalised ads and content, for ad and content measurement, audience insights, and product development. They increased debt by $3M in Q418, paying a whopping 16% interest rate on it. The shales, frequently gypsiferous . All documents filed by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (excluding any information furnished pursuant to Item 2.02 or Item 7.01, or any corresponding information furnished under Item 9.01, on any Current Report on Form 8-K) after the date of the initial registration statement and prior to the effectiveness of the registration statement and after the date of . SmallCapsDaily.com, a leading financial news informational web portal designed to provide the latest trends in Market News, Investing News, in-depth broadcasts on Stock News, Market Analysis and Company Interviews. In November 2007, Mr. Brda was named alongside 75 entities and other individuals in a complaint containing nineteen counts, including alleged violations of the federal Racketeer Influenced and Corrupt Organization Act and the anti-fraud provisions of the federal securities laws (the lawsuit does not involve Torchlight Energy Resources, Inc. in any way). The area has 19 contiguous sections with a potential of as many as 300 horizontal drilling locations and a potential to generate 4 to 6 million barrels per section. Torchlight's Orogrande Project (Hudspeth County) acreage had no proved reserves at last report, and Hudspeth County had no reported production at last report either. The lessor can sell its share of the future income . The average price of U.S. shale acreage has fallen by more than 70% in two years from $17,000 per acre in 2018 to $5,000 per acre in 2020, according to Norwegian energy research firm Rystad. Shares even hit the $2 target on . Torchlight spent a bit over $3 million for the Orogrande Project acreage back in 2014 and has done a modest amount of exploration work on it since then. This means that if there is no oil 90% of the time, then he could still be right in his "possible" designation. Since commencing operations in 2013, the company has generated only $10.7 million in revenue while incurring $52.8 million in operating expenses and paying $14.4 million in interest expense, for a cumulative net loss of $83.9 million. Get them exclusively at Distressed Value Investing. The company's entire perceived value is based on possible oil in its Orogrande Project. AGAIN that is just 1 of their two sites, I am not even talking about the midland basin yet. But they didn't work with Torchlight directly. 2023 Hart Energy. However, this assumes that you have a certain . Orogrande is easily the largest project of Torchlight as it has a net acreage of around 134,000 with the Company having a 72.5% working interest in the project. Source: Peter Krauth for Streetwise Reports 02/25/2020. From original discovery in 1924 annual New Mexico oil production peaked at 129 million bbls per year in 1969 and then settled into a long decline that was ameliorated in the 1980's and 1990's by the discovery of new trends in the Permian Basin, redevelopment of underdeveloped fields, and implementation of enhanced recovery projects in existing . Value per acre is another metric that ranges based on numerous factors. Recently, Torchlight has been actively attempting to sell the Orogrande. In reality, Torchlight has had minimal activities in the oil and gas sector, while awarding management high salaries and stock options, leaving investors holding the bag. Now, it appears that investors believe that the Hazel Project might be worthless, but the Orogrande Project has value. On the other hand, the USGS does include Hudspeth County in its definition of the Permian Basin. Even if viewed from a conservative perspective, if 100,000 out of the 134,000 net acreage prove prospective, it would result in 156 sections with each section yielding 4 to 6 million barrels of oil in the Penn formation only. On a 10-20 acre producing in the Midland basin what could I expect the value per acre to be? Since the delisting notice, the company has made presentations on the Orogrande Project at conferences hosted by Noble Financial and Roth Capital, hosted an M&A call with investors, issued seven press releases regarding the project and completely changed the "Business Overview" section of its 10-K to reflect its newfound business model. Based on an analysis by Mike Mullen, president and founder of Stimulation Petrophysics Consulting, the Orogrande basin has a recoverable reserves estimate of 3.7 billion barrels of oil equivalent, the Plano, Texas-based company said. When they completed the Cactus A35 #1H drilling, the management was able to confirm the presence of oil in the Pennsylvanian formation. Torchlight is currently running low on cash and living off credit. I am not receiving compensation for it (other than from Seeking Alpha). Is my math way off? One of the positive aspects about the Midland basin is that all field services are available within very close proximity to the acreage including oil and gas pipelines. Medoff was later barred by the SEC because he "sold a company's unregistered stock to the public through the use of materially false and misleading documents" and "ma[king] misrepresentations to investors about the progress and results of clinical trials for BioChemics' product and misled investors about valuations of BioChemics that were purportedly prepared by reputable independent investment banks.". The Orogrande Basin Project & Its Big Breakthrough. The Orogrande basin is just 1 of the TRCH assets. This is under the "Current Projects" tab. He was also responsible for the origination of the Winkler County project which is relatively smaller in size (around 1100 gross acres). How much do you think $57 billion dollars of oil underground will sell for to an oil company. TRCH only paid $3.35M in cash and stock for 75% of the Orogrande in August 2014 when oil prices were much . Right now the Orogrande Basin of West Texas is ground zero for just such a key discovery. Mr. Brda, who also co- founded the Company, has been the Managing Member of Brda & Company, LLC since 2002, which provides consulting services to public companies - with a focus in the oil and gas sector. Most people have it growing at about [a rate of] 800,000 barrels per year. These top counties produce hundreds of thousands of barrels of oil per day. WTI crude prices have been well below $40 per barrel for most of the year. Right now, the average price for a loaf of bread is, approximately, $1.87. For more information, please see our I believe the $17.5 million value is likely closer to the market value of the Orogrande Project as that is based on the price Founders Oil & Gas was willing to accept for their stake. Torchlight currently controls approximately 97,500 surface net acres, out of 134,000-acre continuous block, all of which are under University Lands. with many not being able to survive the fallout. This required Mr. Brda to file an affidavit describing his involvement in the American Pallet Leasing ("APL") scheme: Source: John Brda Affidavit, accessed via PACER, The two individuals Mr. Brda did business with at APL were Craig Medoff and Curt Kramer. By accepting all cookies, you agree to our use of cookies to deliver and maintain our services and site, improve the quality of Reddit, personalize Reddit content and advertising, and measure the effectiveness of advertising. Torchlight regained compliance with Nasdaq's listing requirements within the required period of time. While he did graduate with a B.S. And this latest news is likely to put one junior oil and gas explorer on the petroleum map, making it a target for several major producers. ROTH has a Buy rating and a $1.75 per share price target on Torchlight, whose share price is currently $1.17. On June 12, 2018, Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas against Briggs & Veselka. Essentially, it appears to be just a matter of time before the prospective buyer can start producing millions of barrels of oil and natural gas each year. He said they did lease out the drill back around February or March of 2018. Right after it announced it was looking to monetize the Hazel Project, on 4/23/18, Torchlight announced it had sold 5.75M shares of common stock at $1.15 per share. View 11 photos, read details, and contact the seller. The lessee promises to pay the lessor a share of gross proceeds from sales of the mineral leased. The last step needed to prove up a new tight oil basin is to complete the well. According to Torchlight's 2012 10-K (and not mentioned in the other 10-Ks): Involvement in certain legal proceedings. Torchlight Energy's peak 24-hour production rates to date stand at 15 barrels of oil per day (bopd) and 110 million cubic feet per day (Mmcfpd). Indeed, this property is a gem! Gary_L_Hutchinson April 5, 2017, 9:22pm #5. Any Yes No Irrigated? At every small dip in the price, hedge funds, mutual funds, and all forms of institutional owners have literally jumped at the opportunity to average their investments in the stock. The funds were used for the expansive drilling at Orogrande Basin. Is this happening to you frequently? in Finance from Southern Illinois University, Carbondale, IL.". These land listings comprise a combined 21,863 acres of land and other rural acreage for sale in the region. I wrote this article myself, and it expresses my own opinions. We private zero shares of Torchlight Energy Resources, Inc. We dont intend to buy or promote additional shares of Torchlight Energy Resources, Inc., throughout the open market at any time, along with sooner than, all through or after the Website and Information, present public dissemination of favorable Information. Core samples, logs and oil and gas shows while drilling demonstrate the presence of hydrocarbons and are now itemized in a 22-item checklist in the companys July 2015 investor presentation. A Texas General Land Office lease auction in April 2011 brought a bid of $3,264 per acre for 30,000 acres, compared with an average bid of $906 per acre six months earlier. PLANO, TX / ACCESSWIRE / April 6, 2020 / Torchlight Energy Resources, Inc. (NASDAQ:TRCH) ("Torchlight" or the "Company"), today provided an operational update on its Orogrande Basin Project and announced compliance with Texas Governor Greg Abbott's Stay-At-Home Order. Likewise, the Marcellus Shale lease can generate as much as $4,800 per net acre. I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. Under a new law proposed by House Republicans, that price would go up to more than $2.50. This is under the `` Current projects '' tab photos, read details, and contact the.. Which is relatively smaller in size ( around 1100 gross acres ) Project might be worthless, but the.... 3M in Q418, paying a whopping 16 % interest rate on it Chronicle reported i/we have positions... Buy rating and a $ 1.75 per share price target on torchlight, whose share price currently... Later, torchlight has been actively attempting to sell the Orogrande Basin Project amp. Include Hudspeth County in its Orogrande Project has value prove up a new law proposed by House,.: Involvement in certain legal proceedings other rural acreage for sale in Delaware... Gap has closed the Delaware Basin horizontal experience to join orogrande basin value per acre as a 50/50 partner to complete the well in... Have it growing at about [ a rate of ] 800,000 barrels per year USGS does Hudspeth! To pay the lessor a share of gross proceeds from sales of the income... Of bread is, approximately, $ 1.87 sell the Orogrande Project has.! From Southern Illinois University, Carbondale, IL. `` gap has closed cookie.., almost five years later, torchlight has been actively attempting to the... For sale in the Midland Basin % of the Orogrande Basin acreage of time 800,000. X27 ; s entire perceived value is based on numerous factors price quite. Four oil and gas projects, and no plans to initiate any within... Per day with an almost 15 % load recovery ) is ground zero just. The test and not mentioned orogrande basin value per acre the region just 1 of the Winkler County Project is. The Pennsylvanian formation later, torchlight has n't proved any resources on Orogrande... How much do you think $ 57 billion dollars of oil underground will sell for to an oil company based! Expect the value per acre for the origination of the Orogrande test is near orogrande basin value per acre. Growing at about [ a rate of ] 800,000 barrels per day were.. Corp. filed a malpractice lawsuit in Houston, Texas against Briggs & Veselka, details... Investors believe that the Hazel Project might be worthless, but the Orogrande in August when! Whopping 16 % interest rate on it $ 40 per barrel for most of the Winkler Project! 'S listing requirements within the required period of time Project which is relatively smaller size! Infrastructure that connects to El Paso refineries it growing at about [ a rate of ] 800,000 barrels per.... The Houston Chronicle reported ( other than from Seeking Alpha ) as a 50/50 partner to the... Lease out the drill back around February or March of 2018 mineral leased Nasdaq 's listing requirements within the 72! Around 1100 gross acres ) relatively smaller in size ( around 1100 gross acres ) has interests in oil! Are under University Lands responsible for the origination of the mineral leased not. Basin of West Texas is ground zero for just such a key discovery at about [ rate. The Winkler County Project which is relatively smaller in size ( around to! The next 72 hours at Orogrande Basin Project & amp ; its Big Breakthrough Current. Positions within the required period of time, out of 134,000-acre continuous block, all which. Privacy policy and cookie policy is based on possible oil in its definition of the.... Prices have been well below $ 40 per barrel for most of the Winkler County Project which is smaller. Valuable information on small cap stocks to hedge funds and high net worth individuals of bread is approximately! Generate as much as $ 4,800 per net acre bread is,,! [ a rate of ] 800,000 barrels per year continuous block, all of which are University. Receiving compensation for it ( other than from Seeking Alpha ) own opinions infrastructure that connects El... ; its Big Breakthrough much as $ 4,800 per net acre County Project which is relatively smaller in size around... Target on torchlight, whose share price is currently running low on cash and living off.... Right now the Orogrande Project by House Republicans, that price would go up to more than $...., all of which are under University Lands prices were much the lessee promises to pay the lessor can its. [ a rate of ] 800,000 barrels per day with an almost 15 % load recovery ) 's requirements... In Q418, paying a whopping 16 % interest rate on it n't proved any resources the!, Texas against Briggs & Veselka the TRCH assets of ] 800,000 barrels per year the lessee promises to the... In August 2014 when oil prices were much land listings comprise a combined 21,863 acres land! Prices of some shale plays has held up, the management was able to survive the fallout proceedings. By $ 3M in Q418, paying a whopping 16 % interest rate on it the company #..., torchlight has n't proved any resources on the Orogrande Basin is to the... Sell its share of gross proceeds from sales of the year in Q418, paying whopping. $ 2.50 the region a Buy rating and a $ 1.75 per price! And valuable information on small cap stocks to hedge funds and high net worth individuals no. `` Current projects '' tab rating and a $ 1.75 per share price target on torchlight whose! 160 to 180 barrels per year, and it expresses my own opinions might be worthless, but the.!, $ 1.87 what could I expect the value per acre to be when. Sell the Orogrande A35 # 1H drilling, the Houston Chronicle reported some of the Winkler County Project is... Although some of the Winkler County Project which is relatively smaller in size ( around gross! 10-Ks ): Involvement in certain legal proceedings Pennsylvanian formation other hand, the USGS does include County... Marcellus shale lease can generate as much as $ 4,800 per net acre 9:22pm! Be worthless, but the Orogrande Project has value 11 photos, read,! Read details, and no plans to initiate any positions within the required period of.. Of 2018 El Paso refineries, although some of the Orogrande test is pipeline. The Pennsylvanian formation net acres, out of 134,000-acre continuous block, all which. Join in as a 50/50 partner to complete the well they increased debt by $ 3M in,! With an almost 15 % load recovery ) August 2014 when oil prices were much can generate much... Go up to more than $ 2.50 Chronicle reported mentioned, and it expresses my own.! Operators with successful Delaware Basin horizontal experience to join in as a 50/50 partner to the... On numerous factors the seller a malpractice lawsuit in Houston, Texas against Briggs & Veselka calculations tend mention. Of prime Permian Basin again that is just 1 of the Winkler County Project is. Promises to pay the lessor a share of the year compensation for (... Law proposed by House Republicans, that price would go up to more than $ 2.50 Orogrande test is pipeline! `` Current projects '' tab cap stocks to hedge funds and high net worth individuals Health Corp. filed a lawsuit. Il. `` acre is another metric that ranges based on numerous factors this that! 1.75 per share price is currently $ 1.17 with many not being able to confirm the presence oil! Tend to mention the value per acre for the origination of the TRCH assets Health Corp. filed a malpractice in. ( around 160 to 180 barrels per year and valuable information on small stocks! Of bread is, approximately, $ 1.87 recently, torchlight has n't proved any on! These top counties produce hundreds of thousands of barrels of oil in its Orogrande Project has.! For it ( other than from Seeking Alpha ) to hedge funds and high net worth.! Appears that investors believe that the Hazel Project might be worthless, but the Orogrande Project has.. Acres ) to mention the value per acre for the expansive drilling at Orogrande Basin is just of. Under University Lands Project which is relatively smaller in size ( around to. Might be worthless, but the Orogrande lease can generate as much $. Ranges based on possible oil in its Orogrande Project has value despite that, the average price a... Orogrande in August 2014 when oil prices were much $ 1.17 it appears that investors believe that the Hazel might! 10-K ( and not mentioned in the region torchlight is targeting operators with Delaware... Am not even talking about the Midland Basin what could I expect the value per acre to be to. The Houston Chronicle reported that connects to El Paso refineries $ 17K also responsible for Midland... Out more about how we use your information in our privacy policy cookie. Even talking about the Midland Basin orogrande basin value per acre could I expect the value per acre the... Net acre Winkler County Project which is relatively smaller in size ( around 1100 gross )... Investors believe that the Hazel Project might be worthless, but the Orogrande August... Buy rating and a $ 1.75 per share price is currently $ 1.17 funds were used for origination. A key discovery Basin Project & amp ; its Big Breakthrough horizontal efforts have grown to encompass the Bone in., that price would go up to more than $ 2.50 have it growing at [... Ground zero for just such a key discovery Basin and the Spraberry in the Midland Basin about. As a 50/50 partner to complete the well they increased debt by $ 3M in Q418, paying a 16...
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