I think my trial membership expires today so I would like to make one last statement. When I get into a position of being able to contribute useable information then I will consider paying the membership for SI, until then I will continue to read all of your post as before. I think this stock has a following of knowledgeable people on this and CW threads. But for those potential investors who lurk only, I would like to encourage them to break out the calculator and figure out the potential of this company for themselves. To often we have focused on issues that won't make much of a difference one way or another, such as the name of the major oil and gas Co. that Pamco has executed an agreement with to utilize their stripper well technology on their wells. Bottom line the company has 500 methane wells and 4000 oil wells that can utilize the technology.
NOW TURN ON YOUR CALCULATOR! I will use the oil wells as an example as I am not familiar with the impact on methane wells. As has been previously published, "PAMCO's technology has been shown to reduce costs from 50% to 80% and to increase production from 22% to 100%". We will figure conservatively. Average stripper well production using pump jack recovery systems is around 3 BPD. Take this company's 4000 oil wells and multiply by 3 we come up with 12,000 BPD total. At an increase of 22% using the new technology the total production will increase to 14,640 BPD. Now, it has been published that the cost of getting stripper well oil to market (as I remember) was around $12 per barrel. At a 50% reduction in cost, there will be a $6 savings per barrel. 6 X 14640 = $87,840 per day savings. Lets assume the agreement calls for a 50-50 split in the savings on the existing 4000 wells. Then Pamco's share would be $43,920 per day. Lets say that the average # of days per year these wells will be in production is 300 (This is a number that I have heard before but can't attest to it's accuracy, but sounds like a fair # to me).
$43,920 X 300 = $13,176,000 per year. NTAH has a 50 - 50 partnership with PAMCO so, 13,176,000 X 1/2 = $6,588,000 per year for NATH. $6,588,000 divided by 20,000,000 shares = $.33 per share. This tells me that this is a $3 stock in the foreseeable future based on this project alone.
Remember that this is using the conservative #'s and is oversimplified on estimates of agreement with Oil and gas Company.
I am only guessing on the partnership arrangements for the purpose of making some calculations here.
There are over 433,000 PRODUCING stripper wells in the US and another 500,000 stripper wells not operating at this time. Not to mention that there is a lot of interest from foreign companies also. As you can see, there is great potential for this technology and this company. Put your calculator on it and it will blow your mind.
Don't forget the Matagorda gas lease. Three wells on that lease have already produced 2 bcf of natural gas for a Company called GEO Southern before they sanded up. This proves gas at the Miocene level and the Frio level holds potentially a lot greater amount of gas. the 3-D seismic's show very favorable prospects at both levels, and this could be why negotiations have dragged on for so long. The potential jv is probably trying to squeeze as much from the partnership as possible and I am glad that NTAH is not just giving it away to pacify some grumbling from a stock thread.
Bottom line is this company will pay off for those who have patience, and when the price dips just accept it as another opportunity to average down. I do.
Have enjoyed posting this month and will continue to read.
Bye for now and good fortunes to all.
JackT
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