Press

US Oil & Gas Small Cap Has 'Potential for Significant Upside'


ROTH Capital Partners initiated coverage and reviewed this energy company's U.S. projects.

Torchlight Projects
Torchlight Drilling

In a June 18 research note, analyst John White reported that ROTH Capital Partners initiated coverage with a Buy rating on Torchlight Energy Resources Inc. (TRCH:NASDAQ), which "offers very significant upside." ROTH's price target of $1.75 per share compares to where the company is currently trading, at $1.37 per share.

White noted that Torchlight has three oil and gas projects, one in the Orogrande Basin, Hazel in the Midland Basin and Winkler in the Delaware Basin. Due to the "scope of the Orogrande and results to date," the company has shifted its primary focus to that West Texas asset from Hazel, indicated White.

As for the Orogrande, Torchlight has about a 68% interest in 133,000 adjoining net acres of oil and gas leases, a "position comparable to many, much larger exploration and production companies," described White. The company has drilled two wells and is working on another, all in the Pennsylvanian Formation. Results from the third well are expected "in the near term."

To fund exploration in the Orogrande initially, Torchlight plans to use the $6 million generated from a public offering earlier in the year. Additionally, management has indicated it is willing to divest of Hazel to yield further capital to support efforts at Orogrande. "The rationale for the divestiture hinges on liquidity and the potential capital needs at the Orogrande project," the analyst wrote.

About the Orogrande project, White concluded, "While we stress Torchlight's Orogrande efforts are in the very early stages, the very large acreage position poses the potential for significant upside in terms of reserve and production growth."

As for the Hazel project, Torchlight, the operator, owns an 80% interest in 12,000 mostly contiguous gross acres on which it has drilled a handful of wells. "The results from this drilling activity have confirmed the Lower Wolfcamp A, Upper Wolfcamp B as well as the Upper Wolfcamp A, the Dean Formation and the Leonard Formation," reported White.

With respect to the Winkler project, Torchlight, a nonoperating partner, has a 12.5% interest in 1,080 gross acres. Drilling has begun there with the UL 21 War-Wink 47 #2H well. White explained that "the plan is to evaluate the various potential zones for a lateral horizontal well bore to be drilled once logging is completed."

White highlighted that inside ownership of Torchlight indicates the management team is "strongly aligned with shareholders." Directors and officers cumulatively own 27% of the common stock. Gregory McCabe, chairman of the board of directors, owns 23%, individually or through affiliates.


Visit source site

https://streetwisereports.com/article/2018/06/20/u...

NasdaqUnited StatesOilgasStreetwise ReportsTorchlight Energy ResourcesTexasROTH Capital Partners

More items from oilvoice


Equinor Deepens in Offshore Wind in Poland

Equinor has exercised an option to acquire a 50 % interest in the offshore wind development project Bałtyk I in Poland from Polenergia. This transaction is a follow-up of the agreement between the two companies which came into force in May 2018 , by which Equinor acquired a 50 % inter ...

OilVoice Press - OilVoice


Posted 1 month agoPress > EquinorEquinor EnergyPoland +2

Nigeria has highest capex on crude and natural gas projects in sub-Saharan Africa Over Next Seven Years, says GlobalData

Nigeria accounts for more than 34% of the proposed capital expenditure (capex) on planned and announced crude and natural gas projects in the sub-Saharan Africa over the period 2018–2025, according to GlobalData , a leading data and analytics company. The company's report: ‘H2 2018 Production ...

OilVoice Press - OilVoice


Posted 1 month agoOpinion > GlobalDataNigeriaCrude +5

CNOOC Signs Strategic Cooperation Agreements with 9 International Oil Companies

HONG KONG, Dec. 18, 2018 /PRNewswire/ -- CNOOC Limited (the "Company", SEHK: 00883, NYSE: CEO, TSX: CNU) announced today that its parent company, China National Offshore Oil Corporation (CNOOC), has signed Strategic Cooperation Agreements with 9 international oil companies including: Chevron, Conoco ...

OilVoice Press - OilVoice


Posted 1 month agoPress > CNOOCChina National Offshore Oil CorporationChevron +11

Total Announces the Distribution of its Second 2018 Interim Dividend

The Board of Directors met on December 12, 2018 and declared  the distribution of a second interim dividend for the 2018 fiscal year of €0.64 per share, in accordance with the Board's decision of July 25, 2018, an amount equal to the first 2018 interim dividend and an increase of 3.2% compared to t ...

OilVoice Press - OilVoice


Posted 2 months agoPress > TotalDividend

Methyl Tertiary Butyl Ether Capacity Will Grow at a CAGR of 16.8% in India Over Next Four Years, says GlobalData

India's Methyl Tertiary Butyl Ether (MTBE) plant capacity is forecasted to grow at a compound annual growth rate (CAGR) of 16.8% from 0.211 million tons per annum (mtpa) in 2017 to 0.460 mtpa in 2022, according to GlobalData , a leading data and analytics company. The company's report: ‘ Met ...

OilVoice Press - OilVoice


Posted 2 months agoOpinion > GlobalDataIndiaMTBE
All posts from oilvoice