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Abraxas Petroleum Corp. Message Board

  • kentw007 kentw007 Apr 27, 2012 1:41 PM Flag

    Royale energy going higher

    ROYL - "buyout target"

    "Royale Energy was high bidder on the largest total acreage in Alaska's Dec. 7 North Slope lease sale, taking 60 tracts in three blocks that cover more than 100,000 acres for $2.7 million. Royale is considering several potential partners, according to its vice president for exploration and production, Dr. Mohamed Abdel-Rahman. The company plans to drill as many as six evaluation wells next winter, two on each of its three lease blocks. Last month, Abdel-Rahman told the Anchorage Daily News, "The potential reward in Alaska is huge. No other shale opportunity comes close to this, not only in the Lower 48, but also in other parts of the world that we can access. This is a prime shale play."

    "Given that Royale Energy's VP of Exploration is an expert geologist with vast experience in Prudhoe Bay and its environs, it is probably a safe bet to think that the price of these acres will soon skyrocket to $10,000/acre or more, especially after the substantiation of their value by the recent USGS report. With a little development work, ROYL may soon be seen to have profited by roughly $1B or more on this deal. Given ROYL's current $65 million market cap, this deal alone makes ROYL a huge buyout target. When you take into consideration that ROYL was already considered greatly undervalued before this deal (a huge buyout target before the deal), you get an idea of how quickly its stock price may rise."

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