Today shortly before the opening bell, Strategic American Oil announced that it has received its fiscal year end independent reserve report for the company’s productive interests in Texas and Louisiana as of July 31, 2011. Investors should note that this reserve report does not include the recent acquisition of SPE Navigation I, LLC.
The report estimates net proved reserves of 1.2 million barrels of oil and 12.5 Bcf (billion cubic feet) of natural gas. According to the press release, this translates to approximately $97.3 million undiscounted, or $58.9 million discounted at 10 percent, in net proved reserves for Strategic American Oil.
When including the SPE interests, the number increases significantly to an estimated net proved reserves of 1.6 million barrels of oil and 16.6 Bcf (billion cubic feet) of natural gas, which translates to approximately $128.2 million undiscounted, or $77.7 million discounted at 10 percent, in net proved reserves for Strategic American Oil. This compares to the company’s current market cap of approximately $18.5 million.
In the press release, Strategic American Oil President and CEO, Jeremy G. Driver, commented, “The acquisition of Galveston Bay Energy has proven to be a valuable investment as evidenced by our increasing reserves, production and drilling opportunities. Our reserves have increased even further since our recent acquisition of SPE, which greatly enhances our revenues and cash flow.”
The independent reserve report was prepared by Ralph E. Davis Associates, Inc., a Houston-based petroleum engineering consulting firm since 1924.
The company also told investors that an updated corporate fact sheet is now available from its website, which can be found under “Investor Info.” Shareholders may also wish to view a recently completed interview with CEO Jeremy Driver who provides an overview of Strategic American Oil’s focus at the following link: http://youtu.be/T31Oo6cZWPg.
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