Thank you for your input !! You bought for the same reasons the geologist did. BTW per his profile his partners have 90,000 acres in Central Utah Area.
Hopefully you saw where he took apart the First Albany Report:
Delta’s Central Utah ---Per First Albany Analyst Report
Utah Overthrust Play has Multi-Billion-Bbl Potential; Delta and Partner Control Preferred Acreage Offsetting Covenant Field
Discovery
As if one world-class play weren't enough, Delta has partnered with one of the best Overthrust play generators in the world, Armstrong Oil & Gas Inc. (private), in its Utah Overthrust play. Bill Armstrong, President of Armstrong, put together this play, which lies on trend with the prolific Covenant Field (75-100 MMBbls) that was discovered in 2004 by Wolverine Oil & Gas (private). Prior to Wolverine's wildcat well,
only two other wells had been drilled in the trend and neither were on structure. The discovery well encountered 450' of net pay (with an additional 650' of wet pay in deeper sands). It was completed in 10' of pay at an initial rate of 800 Bbl/d (of light, sweet crude) and inclined to a current rate of approximately 1000 Bbls/d. Armstrong determined that the oil was Mississippian age in origin, which indicates it emanates from a prolific phosphitic source rock (the same source rock that charged the Athabasca tar sands and Prudhoe Bay Field).
It established a geological model in which 1-3 trillion barrels were generated and migrated westward, with the potential for multi-billion-barrel fields along the fault-bounded trend on which Covenant lies (in the northeast corner).
Some oil "leaked" across the fault westward to establish the 20-billion-Bbls Rangely Field in Colorado. Armstrong proceeded to lease the most prospective structures along the trend to the southwest. It took on Delta as a partner (Armstrong retained an average 35% working interest) because management had longstanding relations with Delta management and it did not want to farm out the prospect to a large independent or major oil company that could drill it out of the play (i.e., outspend its financial capacity).
The Covenant Field holds estimated recoverable reserves of 75-100 MMBbls from 10 wells. Delta's first prospect (Joseph prospect, 32.5%WI), in which Wolverine has a 50% WI, is seven times larger than the Covenant Field structure. Based on a 1,000' oil column of which ¾ is net pay, a recovery factor of 25%, and 650-acre spacing, the structure could hold 250 Bbls per acre foot, or 600+ MMBbls. This is the first of three mega-trends in which Delta holds a 32.5% to 65% WI. It has identified a total of 21 different features over 170,000 net acres that we estimate exposes Delta to 1.4 billion Bbls in net unrisked reserve potential. Delta anticipates it will receive a permit to drill the first well on its Joseph prospect by mid-Sept and reach total depth (8,000') by the end of October.
Assigning a value of $0.50/Mcf to net unrisked reserve potential of Columbia River Basin (we estimate 4.5 Tcf) and $5.00/Bbl to the net unrisked reserve potential of the Utah Hingeline project (we estimate 1.4 Billion Bbls), we calculate a per share potential asset value of $175.
Internet Postings by geologist involved in Central Utah.
OILFNDR PROFILE
www1.investorvillage.com
My partners currently have over 90,000 gross acres under oil & gas leases in Central Utah.
geologist DPTR, FDG, SJT, CWEI
First post covering Central Utah:
www1.investorvillage.com
As an introduction, I have been working as a geologist on various prospects in Central Utah for the past 10 years.
Although the Columbia River Basin is a huge home run, my primary interest in buying a large position in DPTR was their large working interest position in 21 prospects within the Central Utah Sevier Fold & Thrust Belt of Central Utah.
Delta Petroleum is currently building a road and location for the it’s first prospect, recently permitted as the Joseph Federal 1, located in Section 24, T25S, R4E, SLM, Sevier County, Utah.
This location is directly southwest of the giant Covenant Field discovery completed in 2004. The Covenant Field is a major oil discovery with 96 million barrels of oil (proven reserves) covering an area slightly more than 800 acres.
The Covenant Field discovery well had 487 feet of gross pay and 424 feet of net pay (in porous sandstones) that average 12% porosity and 100 mD permeability. The Jurassic Navajo Sandstone (approximately 1200 feet thick) is the same reservoir (world class reservoir) that produces within the prolific Utah/Wyoming thrust belt.
searchanddiscovery.net
The Joseph Prospect covers a giant structure closure approximately 2.5 times larger than the Covenant Field with up to 250 million barrels of potential oil reserves.
I see nothing but significant upside potential for Delta Petroleum as the stock will soon prove to be significantly undervalued.
My greatest concern is a takeover prior to Delta proving oil and/or gas reserves in Central Utah and the Columbia River Basin. Don’t be surprised if Delta sells all of its assets to focus on these two world class frontier areas.
Comments on First Albany Analyst Report:
www1.investorvillage.com
Good Report, however, there are some updates and/or corrections that should be included with this report.
Wolverine drilled the Salina Twist Canyon prospect located northeast of the Covenant Field (Gunnison Thrust System), and has also drilled the Gunnison Cedar Ridge Prospect located on the Aurora trend (Paxton Thrust System). Both wells were drilled off structure because of velocity problems and/or structure complexities. Ansbro Petroleum has also drilled one exploration well on the Gunnison thrust trend and Cleary Petroleum has drilled one exploration well on the Paxton trend. Again, both exploration test wells were drilled off structure because of velocity problems and/or structure complexities.
Delta, Wolverine, and Armstrong have recently formed a new partnership for Central Utah referenced as DWA. Armstrong's geophysical expertise is second to none within the thrust belt, and they believe they have corrected the previous Wolverine seismic velocity problems and interpretation problems (personal communication).
The source of the oil produced from the Covenant Field is the Mississippian Delle Shale Member of the Deseret Limestone. Although Mississippian age source rocks are responsible for approximately 18 billion barrels of tar sand deposits in Southeastern Utah and/or Eastern Utah, the Rangeley Field in Colorado is sourced from Permian age source rocks and not Mississippian source rocks (recent UGA study). There is no source rock relationships with the Athabasca tar sands or the Prudhoe Bay Field, other than the source rocks are phosphatic in nature.
From comparing structure maps of the Joseph Prospect and the Covenant Field, the Joseph Prospect is approximately 2 to 3 times larger in size. Assuming the entire 1200 foot gross (900 feet net) sandstone interval (Jurassic Navajo Sandstone) is filled to the spill point with oil, is possible the Joseph Prospect could contain ~250 million barrels of recoverable oil. |
