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  • Contango Is Sitting On A Buda Oil Bonanza In South Texas [View article]
    Excellent update!
    Jan 11 09:56 AM | 1 Like Like |Link to Comment
  • Cold January Setting Up Potential Natural Gas Storage Crisis [View article]
    The main theses of the article is what happens to natural gas storage if we get a cold January (now a given) and a cold February (unknown). If natural gas has to be rationed later in February and in March the only tool to do that is price. There are some power companies that have power plants that run on oil that are sitting idle at the moment. There are also some industrial users that can run their plants on either oil or natural gas. This has happened multiple times in the past after cold winters. I believe the last time was 2003. In 2005 it traded above the oil price conversion point after Katrina.

    The East Region is 300 Bcf below the 5 year average before the big number is reported this Thursday. The debate is not about can it happen, but will it happen.
    Jan 11 09:55 AM | 1 Like Like |Link to Comment
  • Contango Oil: Crimson Adds Significant Value With Upside Of One-Third [View article]
    To me I expect the Buda to be totally repeatable in the sweet spot. Here is a link to an article I wrote about the geology:

    http://seekingalpha.co...

    Additionally, Matador Resources (MTDR) recently had an analyst day and their geologist believes the success in the area for the Buda is due to the Pearsall Arch, which bent the rocks in the Pearsall oil field. He believes there is a strong correlation between Austin Chalk wells and Buda wells and mentioned their GlassCock Ranch, as well as the Booth-Tortuga area, both have strong Austin Chalk wells. I am doing some research now on the Austin Chalk in the area and hope to place that research into a future article.

    U.S. Enercorp drilled a well to the west of Contango's lease and after completing it permitted another well. We may get production results on the first well in a few days. Sage Energy has drilled a very successful Buda well to the south of the Booth-Tortuga lease and has permitted a second well.

    Dan Hughes is using 525 acres for a 4,500 foot lateral and believes that can be down-spaced to around 130 acres. Contango could be looking at 60 Buda wells on the Booth-Tortuga lease and another 25 Buda wells with U.S. Enercorp.

    My understanding is most of the acreage in the area is leased up so there is not an opportunity to go on a stealth leasing spree and acquire a very large acreage position. Hope this helps.
    Dec 26 07:49 PM | 1 Like Like |Link to Comment
  • Contango Oil: Crimson Adds Significant Value With Upside Of One-Third [View article]
    Contango did acquire the Crimson assets for a song. While that is at the detriment to the Crimson shareholders at the time of the merger, it is to the benefit of current Contango shareholders.

    Additionally, the merger included no value for the Buda. The first Buda well drilled by Crimson and USEG didn't come on line until May of 2013. The valuation for Crimson was agreed to in April of 2013 based on the PV-10 value in the 12/31/2012 10K. The Buda alone could be worth more than Contango paid for all of Crimson.

    Dec 26 12:20 PM | 1 Like Like |Link to Comment
  • Cold Winter Could Lead To Massive Natural Gas Futures Price Spike [View article]
    Sadly I considered that trade and didn't execute. Good luck.
    Dec 23 10:24 PM | 1 Like Like |Link to Comment
  • EXCO Resources Could Be Sitting In The Buda Sweet Spot [View article]
    In paragraph 3 line 2 the words "short wells" should read "Austin Chalk wells." Thanks for posting the transcript.
    Dec 14 11:04 AM | 1 Like Like |Link to Comment
  • EXCO Resources Could Be Sitting In The Buda Sweet Spot [View article]
    http://bit.ly/YXgKc3

    Slide 6 shows the location of the Booth-Tortuga sweet spot and all of the acreage CHK had to the west of the Booth-Tortuga lease. Some of that acreage was acquired by EXCO Resources and the rest they have farm in rights.

    If the link doesn't work go to the U.S. Energy homepage and click on their presentation.
    Dec 8 08:47 AM | 1 Like Like |Link to Comment
  • Contango Is Sitting On A Buda Oil Bonanza In South Texas [View article]
    I read the last week of September on the Texas Rail Road Commission website that the Buda 4H well was spud September 19.

    Sometimes, not always, the smart way to invest is to buy high and sell higher. If the Buda wells they are drilling keep turning out like the first three it could go a lot higher from here.
    Nov 22 02:15 PM | 1 Like Like |Link to Comment
  • Contango Is Sitting On A Buda Oil Bonanza In South Texas [View article]
    There have now been 9 successful Buda wells in the area. That doesn't count the Beeler #3H well that should have 30 day production numbers some time next week.

    Contango purchased Crimson without any consideration for any value from the Buda, nor any upside in the Woodbine or the James Lime. They simply used the 12/31/2012 SEC PV-10 values of both companies. Because Contango purchased Crimson for a song the company has the potential to double the stock price over the next year if they play their cards right.

    However, to invest in the Hughes Buda discovery with the most leverage is to buy U.S. Energy (USEG). Here is my Instablog article about it:

    http://bit.ly/19D6yeR
    Oct 10 02:21 PM | 1 Like Like |Link to Comment
  • This Could Be The Winter Natural Gas Bulls Have Been Waiting For [View article]
    A much colder planet for a century or two is not weather.
    Aug 21 02:41 PM | 1 Like Like |Link to Comment
  • Buda Oil Discovery In South Texas Sparks Oil Patch Interest [View article]
    The only food for thought is we are not sure how big or small the Buda sweet spot is right now. Goodrich Petroleum drilled some successful Buda wells in North Central LaSalle County. They tried to drill Buda wells in Southern Central LaSalle County and the wells were so-so at best. The acreage XCO plans to drill has seen successful Buda wells drilled 10 to 20 miles to the South West and 10 to 20 miles to the East.
    Aug 16 04:53 PM | 1 Like Like |Link to Comment
  • Buda Oil Discovery In South Texas Sparks Oil Patch Interest [View article]
    Well, they said they had it. For leases that had not expired they would retain those rights. Once the lease expires it would depend on whether they could renew the lease or not. Then it reverts to what is held by production.

    Most leases in Texas give you rights to 100 feet below your deepest drilling depth for held by production rights. In some places the Buda could be with 100 feet of the Eagle Ford. In other places it would be more than 100 feet below the Eagle Ford.

    Chesapeake had a lot of leases expire and I'm pretty sure EXCO only paid for unexpired leases that they would have an opportunity to hold by production.
    Aug 16 02:45 PM | 1 Like Like |Link to Comment
  • Buda Oil Discovery In South Texas Sparks Oil Patch Interest [View article]
    Yes, I remain a shareholder of USEG. I cannot find another stock that trades for a fraction of its asset value and has explosive growth potential.

    The analysts are waiting for confirmation of the Buda discovery with a second and perhaps third well drilled by Crimson and U.S. Energy. We already have confirmation in four wells in the same area drilled by Dan Hughes and two wells in the same area drilled by Sage Energy.
    Aug 16 07:35 AM | 1 Like Like |Link to Comment
  • Buda Oil Discovery May Spark Bidding War For Crimson Exploration [View article]
    Why would Oaktree Holdings turn down a higher offer? While they have pledged to vote for the merger, that was based on the Contango offer being the best one on the table.
    Jun 25 05:17 PM | 1 Like Like |Link to Comment
  • Emerald Oil: Quite Possibly The Most Undervalued Bakken Producer [View article]
    Emerald is very undervalued compared to most other Bakken plays. But USEG is still the most undervalued Bakken play by all metrics, especially production.

    My concern with the Voyager acquisition was the significant dilution existing Voyager shareholders received in the deal. However, for new investors that is water under the bridge and EOX is undervalued. I also like their acreage in McKenzie county. USEG has been participating with Zavanna on some nearby acreage and they have had solid results so far.
    Jun 19 10:54 AM | 1 Like Like |Link to Comment
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