RE:RE:What's up......with 5.50 USD for Nat Gas ?Mickey2......................I believe it is (PNP) proven not producing status according to the report in 2017, before drilling, the report states 1.8 TCF as it was based mostly on seismic.
The field had not been in production since then, until AXL hooked up the West Pepper last December.
Front Range, run by Malcom Todd at the time, discovered the West Pepper which at the time, was the farthest south well ever drilled in the Montney. Called the 3-26 Well, it was drilled 6000 meters down and 2000 meters horizontally, flowed at 5000 mcf on testing, and closed in.
East pepper was drilled 7 kms to the east and was tested at about 4000 mcf, but had bonus liquids as well, and was thought to be a different formation.............so the gas is there........only more drilling will determine how accurate the 1.8 TCF is. Management is in discussions with various parties regarding how to proceceed with this asset...........and I know the offtake is being negotiated for Pepper east production as we speak..........once confirmed it will be brought on line
Pepper prospect is 33 sections, and rerating should occur once reclassified as PDP reserves
In 2017, Gas prices tanked and Front Range went belly up on some other misfortunate project in the states as well...........subsequently they did a roll back.............and we are still eating that unhappy paper............I also hear we are taking paper from the unhappy, previous management of AXL,who were financial types, who spent a lot of money in Columbia, with a payroll that was triple what we have now, clearly did not know the business...........plus oil prices where still in the tank !
This new team has done this 8 times before.( review management and Director roster)...they fine tuned operations and cleaned up the balance sheet............hence my confidence and investment thesis. Once the stock gets cleaned up, it will get respect, based on the projected cash flows becoming reality.........patience as usual !
Long winded, but hope this gives some historical perspective on how these legacy assets, through incompetence and poor market timing.............have not had their day to shine !
Penny flippers are having a good time as well, knowing they will not lose at these cheap prices as well.
The 30 year downtrend in commodities in general is over, the charts don't lie !
Timing is always the key.............GLTA