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Jonathan Yates is the founder of EarnedMediaUnlimited. He has had thousands of articles appear under his byline in websites and periodicals such Seeking Alpha, The Washington Post, AOL Daily Finance, Foreign Policy, and The Motley Fool, among many others. The views expressed are his own. In his... More
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  • More Than 205 Million Reasons Why Octagon 88 Is Worth More Than Zero

    When your father works in the securities industry for over five decades, one of the first things you learn is, "Never fight the tape."

    This could be costly lesson for those following a recent article on Seeking Alpha, "Octagon 88: A Zero in Any Book." Clicking on the stock symbol of Octagon 88 (OTCBB: OCTX) takes you to the Seeking Alpha site that shows the company has a market capitalization of more than $205 million. At its 52-week high, the company had a market capitalization of about one-third of a billion US dollars.

    Since mid-August, the share price has risen about 50%.

    That is to be expected as oil company stocks are up due to tension in the Middle East. There was also a recent report by the US Energy Administration projecting a 56% jump in global energy usage by 2040, which also took oil stocks higher, too. There are also increasing signs of economic recovery in Europe and Asia.

    As an operating oil exploration company, Octagon 88 naturally rose along with others in the sector. In a previous piece of mine of Seeking Alpha, I also pointed out the superior features of energy firms with assets in Canada. This was buttressed by a recent Wall Street Journal article reporting that Repsol (OTCQX:REPYY), the Spanish oil giant, is looking to spend up to $10 billion on North American aquisitions. With its holdings in Canada, Octagon 88 certainly falls into that category.

    Specifically for Octagon 88, which has concentrated its efforts in the oil-rich parts of the Alberta Province of Canada, a major factor for the rise was the release of dynamic simulation results by Schlumberger, the oil and gas services giant based in Texas. This report utilized core sample from the Elkton Erosional Edge, the center of Octagon 88's programs.

    A recent press release reports that:

    During March 2013 CEC North Star started exploration work in the Manning Area and drilled two wells targeting heavy oil in the Elkton Member (CEC North Star Deadwood 11-4-92-23W5) and the Bluesky Formation (CEC North Star Deadwood 8-12-91-22W5). Both wells resulted in good to excellent reservoir quality (i.e., porosity and permeability) with very good oil quality in the Elkton and higher oil viscosity in the Bluesky formation based on laboratory analysis.

    More public information from the company on any financial website:

    First Project : Elkton Erosional Edge

    · Eight-hundred plus (800+) million barrels PIIP (Third-Party Estimate)

    · 870 million barrels using feasibility study (posted in 8k)

    · Primary recovery (cold flow) 8% to 14 %

    · Infill drilling followed by subsequent pressure maintenance with an additional 8% recovery rate for a cumulative (200+) million plus recoverable barrels Enabled company to make this internal report

    · Followed later by Enhanced Oil Recovery (EOR) exploitation targeting an additional 10% to 20% recovery using proven EOR technologies AGAT laboratories

    As the release about the Schlumberger report stated, "The successful third party validations of the core drilling program with the primary production and infill drilling development possibilities substantially advances the project to the first production wells, targeting initial oil sales to commence in the first quarter of 2014 from the Elkton Erosional Edge Project. "

    Based on that, the Technical Team has provided a Plan of Development (POD) targeting thirty-thousand plus (30,000+) barrels a day. For potential investors and others, an Executive Summary of the POD is being prepared for release soon in the company's filings with regulators.

    For existing shareholders in Octagon 88, a return of more than 90% has been provided in the stock price over the last year.

    Despite that performance, in mid-June, another article appeared on Seeking Alpha with the title, "Octagon 88: It's Worth Zero." From that time and the publication of the second article on August 19 until now, the share price of Octagon 88 has more than doubled, from about $3.72 in late June to almost $8.00 now. That is an increase in the market capitalization of Octagon 88 of more than $100 million.

    That there is bearish sentiment for Octagon 88 is of little surprise.

    There will always be those thinking negatively about any stock: that is what makes a market. As an example, even with Warren Buffett as a major shareholder and oil stocks at a premium with Repsol looking to spend billions on North American energy assets, there is still a short ratio of 2.20 for Suncor Energy.

    Specifically, for Octagon 88, the writers admit to having short positions. They are obviously "talking their book." Nothing wrong with that as I am considering the purchase of Octagon 88 shares, as fully disclosed.

    Those articles were also written before the bullish reports came out in early September. An update provided third party validation for 400 PIIP, well after publication. The final approval from the Canadian Government to file for a drilling license for the Elkton Erosional Ridge was announced on September 16, months after the first article and weeks after the second.

    From worth "zero" in late June to worth more than $205 million now: there's a story worthy of a headline. For those "fighting the tape," it has a very sad, and costly, ending, though when bullish reports are released!

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in OTCQB:OCTX over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Additional disclosure: Long position for OCTX will be initiated based on how well OCTX holds its recent gains.

    Tags: long-ideas
    Sep 18 4:13 PM | Link | Comment!
  • Proposed Change In South Africa Law Shows Superiority Of Canadian Energy Assets...Again!

    Following up a recent article of mine in Seeking Alpha and a comment to a news release from Seeking Alpha, the topic of the superiority of Canadian energy assets is worth greater attention.

    My comment was to the Seeking Alpha report about Exxon Mobil (NYSE: XOM) and Royal Dutch Shell (NYSE: RDA-A) opposing a proposed change in the laws of South Africa that would reduce opposition for its oil firm, Sasol Ltd. (NYSE: SOL). The article I wrote for Seeking Alpha was about the appeal of Americas Petrogas (OTCPK:APEOF), a small cap oil and natural gas firm based in Calgary, that just reported results featuring a 75% increase in net revenue and a 70% jump in sales volume.

    For my blog, I just penned an article about the bullish outlook for Suncor Energy (NYSE: SU), a major Canadian oil and natural gas concern that is a significant holding of Warren Buffett. A future article I am preparing for Seeking Alpha (hopefully!) is on Octagon 88 (OTCBB: OCTX), which has soared over 50% in the last month of market action due to a very favorable report on its energy assets in the oil-rich Alberta Province of Canada.

    For investors, Canada offers the best of all possible worlds in the energy sector.

    For national security and political stability, Canada is protected by the United States. As to the importance of this, review the losses of Royal Dutch Shell and other firms in Libya, Nigeria, and similar areas where there is turmoil. What the situation in Syria is doing to oil prices at present is further proof of how imporant political stability is for an energy company...or any business, for that matter!

    Canada is also very pro-energy development and production.

    The country welcomes foreign investment in the natural resources sector. It is large, sparsely populated, and appreciates that foreign capital and other resources are vital for maximizing the potential of its energy sector. That is very admirable as the government is very clean, too (one of ten least corrupt in recent index rating 174 by Transparency International, ahead of the USA).

    It is also willing to "walk the walk" for more energy development and production.

    The most obvious example is The Keystone Pipeline. It is not Canada that is delaying its construction: it is Washington, DC. There is no logical reason for this either, especially with oil over $100 a barrel. On a monthly basis, the United States is exporting over $30 billion in capital to import oil: many jobs could be created from that massive sum if it stayed at home (Canada does export to the US, too).

    Firms operating from or in the Canadian energy sector range from prominent blue chips like Suncor with its market cap of around $55 billion to promising smaller entities like Americas Petrogas and Octagon 88. The proposed changes in South Africa should make investors appreciate the long term stability of the Canadian oil and natural gas industry.

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in OTCPK:APEOF over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Tags: APEOF, SOL, XOM, SU, long-ideas
    Sep 13 7:53 AM | Link | Comment!
  • The Allure Of Stocks With Unique Marketing Advantages

    When former NFL quarter back Joe Theismann started at the University of Notre Dame as a freshman, the sports information of the legendary football powerhouse had him change his last name so that it rhymed with "Heisman," as in the trophy.

    Shrewd, savvy marketing like that results in a competitive advantage not just for college football players, but for publicly traded companies, too. An obvious one is Starbucks (NASDAQ: SBUX), named after a character in "Moby Dick," one of the greatest novels of all time.

    Another firm that benefits from superior management in setting it apart from its rivals at a low cost is Octagon 88 (OTCB: OCTX), an oil and gas concern with assets in Canada. That names brings up the legendary Phillips 66, which works to the advantage of the shareholders of Octagon 88.

    That is certainly working as Octagon 88 is up more than 50% for the last month of market action.

    For Octagon 88, a very favorable research report on its holdings in the oil-rich Alberta province of Canada has contributed greatly, obviously. According to the report, Octagon 88 received confirmation of 1.6 billion barrels of petroleum initially in place. While its name is a marketing tool, 1.6 billion barrels is a great deal more hardware for increasing shareholder value!

    Media attention from the entertainment sector can also provide plenty of free advertising for publicly traded stocks, too.

    Soupman (NASDAQ: SOUP) is a food company that specializes in soup; and J.D. Hutt (OTCBB: JABA) just acquired Sea Treasure Recovery Corp., a company that brings up sunken valuables.

    Everytime the "Soup Nazi" episode of "Seinfield" is on, Soupman receives tons of free publicity, as that is the inspiration for the company. The same happens whenever "Pirates of the Caribbean" or any other related movie is show for J.D. Hutt. Free publicity benefits both companies.

    The marketing edge of these companies is accentuated when bullish news is released.

    That is certainly demonstrated by the way that Octagon 88 is soaring due to the report detailing the riches of its assets in Canada. Whenever J.D. Hutt brings up sunken treasure, it will be pure gold for its shareholders. For those looking to profit from unique marketing advantages, Starbucks has clearly demonstrated how the shareholders of Octagon 88 and J.D. Hutt can profit in the future!

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in OTCQB:OCTX over the next 72 hours.

    Tags: SBUX, OCTX, SOUP, consumer
    Sep 12 12:36 PM | Link | Comment!
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