Exploration and development are two fairly speculative processes. Much depends on a commodity pricing structure that can fall and rise at a momentâ€™s notice. If an investor chooses to pay attention, however, they can profit handsomely. Understanding the opportunities, while also understanding the reserves that a company may hold for a longer term investment strategy, is the key. Energy, in its many forms, is not going away. A diversified energy portfolio is the trick and one that will benefit regardless of conditions.
Jayhawk Energy Inc., a natural resources company, works to discover, acquire and transport natural gas and oil primarily in North America. Perhaps the companyâ€™s best and largest project to date is its Bourbon County Uniontown Kansas property. The property is located within the Cherokee basin, a historically active and reliable location. The companyâ€™s 35,000 acres of leased land at this location currently indicate 163 Bcf of natural gas in place and the potential for 2.8 Tcf going forward. This particular region has been worked since 1900 and also indicates a 2-4ft. blanket coal seem that has yet to be tapped.
Adjacent to the companyâ€™s Uniontown property is its Girard property. This property consists of 55,000 acres and holds its natural gas pipeline supply network. This 16 mile long system currently has the future capacity to support 4,100 potential drill sites located at both properties. The companyâ€™s oil position is found at its North Dakota Candak property. This site was recently acquired and is currently producing 65bbls of light oil per day. Additionally, a purchase of 15,500 acres of prime acreage was made within the Williston basin. This area extends across the Canadian border and is one that most major oil companies have been working for some time.
Although natural gas pricing has fallen, largely as a result of the poor economy, there does appear to be reason for its return to a more solid footing as the recovery begins to gather speed. Speculation to be sure, but this seems likely toward the end of 2009 or beginning 2010. Oil pricing, however, seems to offer the company a nice revenue stream as its current 5 producing wells take advantage of recent price gains.
Depending upon how one assesses the oil market, the apparent disconnect between supply/demand/pricing for oil should find revenues increasing for Jayhawk Energy. The real advantage the company holds, however, is its land holdings in historically productive regions. Regardless of price moving forward, the need for oil and natural gas is not going away anytime soon. By comparison, the company is priced at a remarkable level and may be a company to put on radar.