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Habanero: Pulling The Oil
Out Of The Sand
by Glenn Wilkins - AllPennyStocks.com News Reporter
December 19, 2005 (AllPennyStocks.com Media, Inc.) -The
habanero chile is the most intensely spicy chili pepper of the
Capsicum genus, according to folks well versed on this sort of
thing. Its colours range from green (when young) to white,
brown and pink to orange and flaming red when mature. These
chilis, originating in Cuba, can rate upwards of 300,000
Scoville heat units, according to the Guinness Book of World
Records, making them a staple item of hotter sauces and
spicier foods.
How does this figure into your portfolio? Well, the oil
business remains a "hot" one, and it's that mentality that
governed the naming of Habanero Resources Inc
(HAO:TSX Venture). An emerging junior oil and gas explorer
and producer, the company has designs on becoming a mid-range
producer before too long. The company earns oil and gas
revenues from 15 wells on oil and gas fields in Texas,
Saskatchewan and Alberta.
What ought to grab investor attention is that Habanero has
one of the smallest, if not the smallest, market
capitalization of all public companies competing in the
contentious Alberta Oil Sands. Plus, with no long-term debt,
as well as cash on hand for future drilling projects, the
momentum for this company is obviously shifted upwards.
Statistics from the Canadian Association of Petroleum
Producers point to the vast oil sands reserves' capacity, that
they produce a million barrels of oil a day, a figure that
should nearly triple in the next 10 years. Alberta accounts
for about 55 per cent of that, and half of what that province
produces is shipped to the U.S., providing 5% of American oil
consumption and 12% of natural gas consumption. Habanero has
entered into an agreement to purchase an equity interest in a
company controlling 10,000 acres in Alberta's Peace River
Country.
Saskatchewan, known throughout Canada for its wheat, is a
solid runner-up to Alberta in national petroleum production,
putting out 20% of total Canadian consumption. Habanero has a
right to take part in a prospective 50-well drill program in
the province's Kerrobert region.
And then, Texas... Texas, Bush country, known the world
over for its petroleum production. Habanero has two fully paid
wells to complete on the Martex project in Texas, activities
on which were suspended during the hurricane scare this past
fall. Habanero has five of five wells drilled successfully on
this prospect.
The latest developments are that Habanero recently
increased its interest in the Oil Sands Prospect in Alberta,
with a potential 111 million recoverable barrels. Habanero
President Jason Gigliotti calls it evidence of how firmly
committed his company is to becoming a mid-range oil and gas
company, reinforcing the low-debt, small-market-cap status of
his firm.
Did we mention cash on hand? Habanero's latest reported
period was Sept 2005 when there was $608,000 cash (values in
Canadian dollars unless specified otherwise) midway through
2005, improving on the $228,000 figure at the end of 2004.
September 2005 is the last period for which financial
information is available, and it does point to a deficit of
more than $6 million, but most other signs are optimistic.
Its stock also appears to have found an audience, on three
different stages. The issue trades under the symbol HAO on the
TSX Venture Exchange, more recently, on the Frankfurt Exchange
(HSJ), and under the symbol HBRNF on the Pink Sheets. The
price's 52-week gully of six cents (U.S.) seems a distant
memory, though it was plumbed in only June, while a peak of 26
cents (U.S.) was achieved in October, when oil was hitting
price highs it hadn't seen for decades.
Habanero's list of activities is making it appear as hot as
the spice it takes its name from, and the wells from it draws
its product are extremely rich. It all makes for an investment
to which folks would be well-advised not to be cool.
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