Quiet place with drilling ready to start.FO has $14 million cash, no debt and is about to get started on a 3 well drill program paid by someone else in an area where success is very likely, yet almost no board discussion.
The Beetaloo sub-basin owned by FO is huge, 4.6 Million gross acres (FO interest is 30%) and already a successful stage one drilling program which would have had quick follow-up if not for the fracking ban which has now been reversed. Based on drilling to date there is a 6.6 Trillion cubic foot 2C contingent resource estimate and the previous drilling caused the stock to run as high as 48 cents a share. Thus the upside just based on getting the drills turning is a double from here and if drilling is successful the double will be just the start.
The coming stage 2 operation could see major share price upside as it is intended to evaluate the liquids rich potential of the basin, (not just dry gas) and liquids would add considerable value to the property.
Australian gas prices are very good ($6 range per tcf) and the property is near a major pipeline. FO's share of the current contingent resource is about 2 trillion cubic feet which would be worth about $12 billion dollars, so basically at the current market cap of FO, you get $60 worth of gas in the ground for $1, but exploration has only just begun and so with more successful wells the resource is going to get bigger and if liquids are thrown into the mix, it gets very exciting.
But I own a lot of shares recently purchased at average costs between 21 and 21.5 cents, so I am certainly biased. But I put my money where my mouth is and we will see how it goes in the very near future.