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Casing of Well Breathes Life Back Into Stock Price Of Junior Miner
By: AllPennyStocks.com News
January 10, 2012
Oil is back on the climb again today after taking a three-day breather following a multi-week rise that has pushed crude back over $100 per barrel. Fueling the rise is some unease about Iran’s nuclear program and its position of controlling the Straight of Hormuz, upheaval in Nigeria and blossoming optimism regarding U.S. economic growth with European financial woes being shoved to the back burner as the markets continue their broad rally. The rise in oil is helping push the S&P/TSX Capped Energy subgroup higher today by more than 1.2 percent in afternoon trading.
Juniors are making headway today as well with Emerald Bay Energy Inc. (TSX-Venture:EBY) seeing a surge in volume and share value. With headquarters in Calgary, British Columbia, Emerald Bay is an oil and gas producer holding production properties in Western Canada and South Texas. According to the company’s website, Emerald Bay controls ten properties in total and is engaged in mineral leasing operations in Medina, Atascosa, Frio, and Guadalupe Counties in Texas. The company’s primary concentration currently is on the potential of its holdings in the oil-rich state as discussed in an operational update provided in December. At that time, drilling of its Imhoff #1 test well in Guadalupe County was set to commence. A six to seven well drilling program is also slated for the first quarter of 2012 at Emerald Bay’s Taylor-Ina field in Medina County.
The latter part of 2011 hosted private placements for Emerald Bay as the company generated funds to be used for drilling wells, seismic activities, contributing to its debt facilities and increasing working capital. The first tranche netted more than $200,000 in proceeds from a sale of units (shares + warrants) to a current shareholder that controls more than 11 percent of the shares of EBY. A second tranche in October brought another $81,700 to the Emerald Bay coffers.
A thinly-traded stock, shares of Emerald Bay held steady at a support level of four cents for more than a year before fading to touch 2 cents in October 2011. Today, news hit the wire that the company has recently drilled and cased a prospective oil well in Guadalupe County. The company said that the logs and geological data support its original optimism on the prospect and that it will now be moving forward with perforation and testing operations on the project. The news has sent life back into shares of EBY with 1.2 million shares changing hands today, representing its heaviest volume day in nearly five months and an appreciation in value by 40 percent to 3.5 cents each at last check.
With more drilling targeted for early this year, a newly cased well and some cash on the books, Emerald Bay looks to be positioning itself for growth in 2012. Investors will surely be on the lookout for some concrete evidence of solid reserves, which could help Emerald Bay to try and recapture levels back above the 4 cent mark from last year. Proper due diligence is, as always, encouraged.
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