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Would welcome any & all opinions on this great O&G company drilling primarily in the Gulf of Mexico and onshore Louisiana. Their current market cap. is about $140 mm on a fully diluted basis. They used to be a boring "acquire & exploit" company but have grown mostly by the drill bit for the last coupla years. Can't understand why there has not been any subject created for this NYSE company. True, they have not catered very much to the retail shareholders (e.i. they do not have a web site) but I'm still amazed that there wasn't a thread going. CRK had gotten a bit overleveraged last year (which O&G company didn't?) and had to bite the bullet on a costly financing this April when the stock was $4. But that's now behind us and in the 2Q 10Q they announced a dramatic increase to their drilling budget for the rest of the year, to wit: "The timing of most of the Company's capital expenditures is discretionary with no material long-term capital expenditure commitments. Consequently, the Company has a significant degree of flexibility to adjust the level of such expenditures as circumstances warrant. For the six months ended June 30, 1999 and 1998, the Company spent $10.0 million and $22.3 million, respectively, on development and exploration activities. The Company currently anticipates substantially increasing its drilling activity for the remainder of 1999 and expects to spend an additional $31.0 million on development and exploration projects in the last half of 1999. The Company intends to primarily use internally generated cash flow to fund capital expenditures other than significant acquisitions. The Company does not have a specific acquisition budget as a result of the unpredictability of the timing and size of potential acquisition activities. The Company intends to use borrowings under its bank credit facility, or other debt or equity financings to the extent available, to finance significant acquisitions. The availability and attractiveness of these sources of financing will depend upon a number of factors, some of which will relate to the financial condition and performance of the Company, and some of which will be beyond the Company's control, such as prevailing interest rates, oil and gas prices and other market conditions." And here's what they've done so far in '99 and what they plan to do with that $31 mm they are spending for the 2nd half of the year (from the 2Q press release): "The Company continues to have strong results in its Gulf of Mexico exploratory drilling program. To date in 1999, Comstock has drilled six offshore exploratory wells (1.2 net) in the Gulf of Mexico under its joint venture with Bois d' Arc Offshore Ltd. Five (1.0 net) of the exploratory wells have been successful. In addition to the discoveries announced earlier, Comstock has an additional discovery at Bay Marchand with the SL 15868 #1 which was drilled to test the ``Nautilus' prospect at a total measured depth of 9,578 feet in Bay Marchand Block 4, four miles offshore LaFourche Parish, Louisiana in 27 foot water depth. The well encountered a total of 38 feet of oil and gas pay in one zone in the upper Miocene aged sands from 9,352 feet to 9,403 feet. The well was recently tested at 6.4 million cubic feet of natural gas per day and 50 barrels of oil per day flowing on a 16/64 inch choke with flowing tubing pressure of 3,405 pounds per square inch. Comstock has a 22.5% working interest in this well. Comstock is currently drilling the OCS-G 18929 #1 with Bois d' Arc at High Island Block 73 with 12.1% working interest. Comstock plans to participate in six additional exploratory wells in the Gulf of Mexico with Bois d' Arc during the remainder of the year. Comstock also plans to drill two additional development wells in its Gulf of Mexico region at South Pelto Block 1 and at East White Point. Comstock will have a 100% working interest in these two wells.' 'In addition to the program in the Gulf of Mexico, Comstock is pursuing a redevelopment and exploratory program in the Double A Wells field and plans to drill up to seven wells in the field during 1999 including the recently announced successful Carter Brothers #E-12 well. Comstock is also currently drilling the Lee #1-alt. in the Ada field in its East Texas/North Louisiana region and plans to drill an additional six development wells in this region by the end of the year." The stock is currently mired just under the $5 mark but IMO once the institutional types come back from vacation after Labor Day and the investment conferences get rolling we will see some serious strength in the stock price. There's also a Raging Bull thread on CRK, at ragingbull.com, and a Yahoo thread, at messages.yahoo.com. | ||||||||||||
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