Innocent is a development stage oil and gas E&P currently focused on their joint venture exploration agreement with Evergreen Petroleum in Wyoming’s rapidly developing Powder River Basin oil sector, which is set to put in over 5k new wells in the next decade alone according to industry estimates. Powder River Basin has long been known as a vast supplier of coal, with ten of the top coal mines in the U.S. located there, including the nation’s largest, the Arch Coal, Inc. (NYSE: ACI) Black Thunder mine. With about 375M short tons of coal coming out of the basin in 2012 according to BLM data, the hydrocarbon geology is well established, but the shale oil potential now awakened by advanced recovery technologies like radial drilling and fracking has made the basin a major frontline in the larger war for total U.S. energy independence.
Partner Evergreen Petroleum has an incredible century and a half plus worth of experience in the industry, combined with extensive knowledge and experience dealing in the local region, making them the perfect partner to be general manager. Moreover, the parties have tapped another local expert, Pacer Energy, LLC out of Gillette, to examine title to minerals in the targeted lease areas where Evergreen intends to drill and eventually produce. Another Gillette local, L & J Operating, Inc., has been selected as operator and will handle substantially all of the day-to-day logistics, from bonding and contractor selection, through to eventual oil sales and payments to the other parties.
There are a multitude of oil-bearing formations in the sub 2.5k-foot depth range to go on after in the Powder River Basin, but there is broader potential across Wyoming as well to be explored and the JV is targeting prospective areas characterized by either high potential for direct offsets to former production or attractive oil and gas shows. The recent (June 10) appointment of corporate finance and restructuring pro, James Kerr (CPA, CMA) to the company’s CFO, who cut his teeth with U.S. Bank before a distinguished career consulting for the Canadian government and working in mutual funds/financial analysis, should go a long ways towards helping this development stage company hone their focus on the road to production-driven, sustainable value generation.
Also in early June of this year, INCT appointed former CEO of Chilean Metals Inc. (TSX VENTURE: CMX) and the privately-held Relief Gold, Terry Lynch, to President and Chairman of the company’s Board. Lynch was instrumental in turning around Firstgold Corp. as a Director and later CEO when the company had run into difficulty financing the completion of their Relief Canyon mine, securing a $26.5M deal with one of China’s top mining engineering and consulting groups. Lynch formerly co-founded Canadian-listed oil and gas company, Pacific Tiger Energy, which was ultimately acquired by Pan Orient Energy Corp. (TSX VENTURE: POE), and looks to be an excellent pick to stand beside CEO Patrick J. Johnson at the head of the company.
While the well completion rate in the Powder River Basin is below the astounding projection of 5k wells over the next ten years (running around 15 to 30 percent of permits), permitting in the basin’s epicenter, Converse, Campbell and Johnson counties, is reported by the Wyoming Oil and Gas Conservation Commission as being in excess of 8.5k over only the last four years. Such immense, obviously demonstrated levels of interest telegraphs a great deal about the play’s potential and the only problem right now in the Powder River Basin is handling the flap over drilling-associated gas flaring or other environmental concerns, like those that have given rise to Wyoming’s newly implemented, state-wide, baseline groundwater testing rules.
INCT has an excellent approach for developing in the Powder River Basin on their hands here, with the technical expertise and field operation heavy lifting safely in the hands of established industry pros, as well as highly localized developers, the company’s experienced management team can focus on maximizing shareholder upside.
Take a closer look at Innocent, Inc. online at www.innocentinc.com
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