| Copyright: | M2 Communications Ltd. | | Source: | M2 PressWIRE | | Wordcount: | 1631 |
RDATE:05062008
Stocks in the news: Striker Oil & Gas, Inc. (OTCBB: SOIS), Rock Energy Resources, Inc. (OTC Bulletin Board: RCKE), CREDO Petroleum Corporation (NASDAQ: CRED), Nova Biosource Fuels, Inc. (Amex: NBF)
June 4, 2008 -- Striker Oil & Gas, Inc. (OTCBB: SOIS) announced today that it has successfully recompleted the LeJeune No. 1 well in its North Edna prospect located in Jefferson Davis Parish, Louisiana. The well came online last week and is currently producing 137 gross barrels of oil per day to the 100% working interest. The decision to move uphole to perforate what could be the best zone in the well was made necessary when the last zone ceased to flow. Based on the current flowing oil rate of the well, payout of the recompletion should occur in less than 15 days. Using current prices and the evaluation of this zone by Striker's third party reservoir engineering firm, approximately $1,000,000 in net revenue should be generated to Striker's interest from this single interval. The North Edna Field has produced over 10 Bcf of gas and 700,000 barrels of oil. Striker has a 40% working interest before payout and a 29.6% net revenue interest before payout in this prospect.
"The first two zones in this well have exceeded our initial estimates and we are optimistic on this additional zone," said Kevan Casey, Chief Executive Officer of Striker. "This recompletion was done in a way that will enable us to go back downhole and evaluate the previously completed zones for additional production in the future using artificial lift."
June 4, 2008 -- Rock Energy Resources, Inc. (OTC Bulletin Board: RCKE), an independent domestic oil and natural gas company, today reported that during its scheduled conference call and webcast held yesterday afternoon, management reported that the initial steaming results at its Orcutt Diatomite project have meaningfully exceeded its expectations.
Development drilling on the 800 proven acres would be vertically and directionally to achieve bottom hole locations for 5/16 acre drainage, with the possibility of an expansion of the Orcutt producing field boundaries by another 25-50% of the currently known limits of the proven results. Rock Energy reported that its internal estimates for proven reserves at Orcutt are 26.6 million barrels of proven undeveloped oil; future net revenues of $1.85 billion; and Sec 10% net present value of $676.9 million. These internal estimates contemplate a full scale drilling program providing for 1200 bottom hole locations, and are based on a per barrel price of $100 flat over the anticipated life of the resource base.
On the same call, Mark Harrington, Vice Chairman of the Company, responded to a question about economics saying, "Our steaming costs are estimated at $12 per barrel, assuming $11 gas; and lease operating costs are $9 per barrel. So, assuming $100 oil prices, and we are above that now, net operating cash flow is above $60 per barrel. If you allocate all the needed infrastructure costs, including steam generators, production batteries, steaming lines, well costs -- everything all in, our cost to get at each barrel of proven reserves, assuming only a 20% recovery rate, is under $10 per barrel."
June 4, 2008 -- CREDO Petroleum Corporation (NASDAQ: CRED), an independent oil and gas company, reported today that the company and certain of its directors have entered into agreements with RCH Energy Opportunity Fund II, LP ("RCH" or the "Fund") a private investment fund based in Houston, Texas, whereby RCH will acquire approximately 17.5% of CREDO's outstanding stock. Closing under the agreements is subject to certain customary closing conditions.
RCH will acquire a total of 1,837,000 shares of the company's stock at a price of $14.50 per share, representing a 13% premium to the stock's 30-day moving average. CREDO will sell 1,150,000 newly issued common shares, or approximately 11% of the company's total outstanding shares on a proforma basis. Directors Huffman, Stevens and Skewes will sell 425,000, 192,000 and 70,000 shares, respectively, or about 40% of the CREDO shares held by Mr. Huffman and his family and approximately 50% of the shares held by Messrs. Stevens and Skewes. CREDO's Board will be expanded from six to seven members and RCH will nominate two directors, one to fill a current vacancy on the Board and another to fill the newly created Board seat.
All of the shares acquired by RCH will initially be restricted and not freely tradable in the open market, however, RCH will have certain future registration rights. The company agreement contains a standstill provision providing that RCH will not purchase additional CREDO stock for a period of two years from the date of the agreement without the consent of the Board of Directors.
June 4, 2008 -- Nova Biosource Fuels, Inc. (Amex: NBF), a refiner and marketer of ASTM quality biodiesel, announced today that it has commissioned its second 20 million gallon per year train at its biodiesel refinery in Seneca, Illinois and has produced more than 3 million gallons of ASTM 6751 standard biodiesel fuel from both the first and second 20 million gallon per year trains.
Our progress at the Seneca refinery continues to solidify our proven process technology that enables the use of high free fatty acid (FFA) feedstocks, which tend to cost less than feedstocks with lower FFA levels," said Kenneth T. Hern, Chairman and CEO of Nova. "Two of the three trains have operated at nameplate capacity and have exceeded our performance objectives for yield, throughput, and quality. The refinery has successfully demonstrated conversion of feedstocks with free fatty acid levels above 10 percent. To date, we've produced more than 3 million gallons, and we expect to begin starting up the refinery's final 20 MGY train in June. Our B100 quality continues to be excellent."
ConAgra Trade Group provides selling and outbound logistics services for Nova's Seneca and Clinton County facilities. "At both the Seneca and Clinton County refineries, Nova has consistently demonstrated that its biodiesel production exceeds all ASTM specifications by a considerable margin," said Eric Watts, ConAgra Trade Group's Director of Business Development. "Product quality and consistency continues to be of considerable concern to the industry, however Nova's Seneca and Clinton County refineries have exceeded all required ASTM specifications by a considerable margin while producing biodiesel from a wide variety of feedstock. We look forward to marketing increasing volumes of Nova's biodiesel as it completes the plant start-up."
The stock market traded in a volatile manner Wednesday, with the S&P 500 trading in a wide range, from up 0.8% at its peak to down 0.4% at its trough. The stock market eventually settled on the unchanged mark as strength in tech offset weakness in financial and energy.
The financial sector (-0.8%) posted a solid gain of 1.1% in early trade, but tumbled on word that Moody's put bond insurers Ambac (ABK 2.50, -0.50) and MBIA (MBI 5.67, -1.02) on review for a possible credit rating downgrade.
The market dipped noticeably in midafternoon trading after the news wires ran headlines from a speech on inflation that was given by Fed Chairman Bernanke at Harvard.
The volatile day ended split down the middle, with five of the ten economic sectors posting a gain. Technology (+1.0%) provided leadership, with significant strength in large-cap names
The energy sector (-1.2%) posted the largest loss, as crude prices fell 1.8% to $122.04 per barrel.
Telecom (-0.8%) was also a laggard, with Verizon (VZ 36.99, -0.37) falling after CNBC reported it may buy Alltel for $27 billion.
The session's three economic reports were not especially strong, but they were all better than expected. Importantly, the data are reflective of an economy that is not in a recession.
Private nonfarm employment rose by 40,000 in May, according to employment services firm ADP.
First quarter nonfarm productivity was revised to a gain of 2.6% from 2.2% (consensus +2.5%).
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