Domestic oil producers are cheering the actions of a U.S. regulator seeking to lift federal lease restrictions on oil and gas production and reinstate production leasing programs following a new court order. The Biden administration is appealing the legal ruling — but the Bureau of Ocean Energy Management (BOEM) is moving forward to resume an offshore leasing program that was halted by Biden in January as part of a climate change/conservation initiative.
Domestic energy producers would benefit. Companies such as Allied Energy Corp. (OTCMKTS PINK: AGYP), U.S. Energy Corp. (NASDAQ: USEG), PrimeEnergy Corporation (NASDAQ: PRNG) and other firms would be positively impacted. Other domestic oil producers would benefit from lifting federal leasing restrictions. They include: Southwestern Energy (NASDAQ: SWN) and PDC Energy, Inc. (NASDAQ: PDCE).
Domestic energy companies include U.S. Energy Corp. (NASDAQ: USEG), an independent energy company focused on the acquisition and development of oil and gas producing properties in the United States. Based in Houston, it recently reported Q2 sales of oil accounted for 75% of its total volume — with production rising 130% from the comparable quarter in 2020. PDC Energy Inc. (NASDAQ: PDCE) is a Denver, Colorado based energy producer which sells oil and natural gas.
PrimeEnergy Corp. (NASDAQ: PRNG) is an independent company which produces oil, gas and oilfield services, primarily in Texas and Oklahoma. In Q2 2021, PRNG produced $12,673,000. Southwestern Energy (NASDAQ: SWN) is a leading producer of natural gas and natural gas liquids, headquartered in Spring, Texas,
Allied Energy Corp. (OTCMKTS PINK: AGYP) is a Texas-based independent with a business model which calls for drilling for oil and gas in Texas, on American soil, to produce U.S. energy on domestic soil from long abandoned but once commercially viable wells.
Walter Kruickshank, deputy director of BOEM, said his federal organization is now moving ahead with leasing again while the federal government is appealing the court rejection. “It will not be too long before you see something,” he said recently at an industry conference. BOEM oversees offshore regulations.
The oil and gas industry has opposed the lease program suspension — which has hampered domestic energy production — while the Biden administration has sought more oil barrel production from OPEC and countries in the Mideast.
BOEM’s actions could ripple to other federal agencies, which would be obligated to re-start the oil and gas leasing programs on more federal lands. Investors in U.S.-based oil and gas exploration firms might take the court decision — triggering the new initiatives in energy leasing on federal lands — as a positive move. Until the Biden court appeal is resolved, federal agencies are free — even obligated — to begin leasing for energy companies on federal land.
At AGYP, stock of the company closed last night at $0.3250 in light volume of 178,639. AGYP reported a positive Q2 financial report which showed a strategy of large cuts in operational and net losses through dramatically cut expenses. Free cash flow created was then reinvested back into the Company’s primary activity: leasing oil wells and applying new technology to make them commercially new again. AGYP’s management team and long term investors see a bright future.
Oil prices have a direct impact on AGYPs stock value as the link between its oil reserve at leased well sites and its assets under management (AUM) is vital. Analysts projected prices would drop quickly after the OPEC-Saudi Arabia-UAE oil production issue was settled, but that is far from happening. At close last night, WTI Crude settled at $66.01 while Brent Crude settled at $68.64.
Analyst predictions that AGYP was among oil and gas stocks to watch in August have borne truth. Media reports of the importance of domestic oil and gas was underscored by the scenes in Afghanistan the past few days.
The Biden administration is now asking global oil producers in the Middle East to raise daily production levels as the U.S. slashes its oil/gas output. The result is that oil prices remain high globally and at home and continuing unrest in the Middle East makes pricing and supply volatile.
All this is moving in the right direction for AGYP. In a series of Tweets, AGYP is making its performance on its leased Texas wells transparent, to its shareholders and the investment community. Tweet photos of progress at its wells plus technical advances gains confidence in a business model that works. American oil from U.S. soil is an advantage that works now more than ever.
In its Q2 OTC filing, AGYP documented that its operating loss during the three months ended June 30, 2021 dropped to $85,913 from $113,368 the comparable period the prior year — a 24.2% decline. For the six months ended June 30, 2021. It cut operating expenses in Q2 2021 to $175,461 from $231,286 — again, by 24.1%. All created similar drops in net loss for both periods.
This was principally achieved by cutting salaries/wages. In the Q2 period in 2021 they were $45,000 vs. $81,000 vs. the same period the prior year. In the six months period in 2021, the salaries/wages number dropped to $90,000 from $162,000 the year prior.
It also showed that AGYP in Q2 moved all of its free cash flow for investing activities — or $224,563 — back into re-investment into its oil and gas properties. This is a management team that believes in its future performance.
AGYP’s Green Lease Site and Annie Gilmer site documents that its Texas-based wells are commercially viable. Engineering reports on the company’s leased wells filed with the SEC as Executive Summaries by a petroleum engineer document the reserves and their value in these OTC-filed supplemental filings.
At the Green Lease Site, Mark McBryde, Petroleum Engineer, found $2,944,900 of proved oil and $18,536,600 worth of probable and possible oil. At the Annie Gilmer Site. he found proved oil and gas reserves of $6,704,900 and probable and possible reserves of $5,489,900, all computed at a market price of $46.26. This is far below today’s market prices — see above. The report findings were complete as of July 1, 2021.
AGYP’s online site describes in detail that this is an oil and gas company managed by energy seasoned veterans drilling leased old well sites with new technologies — making older commercial wells new again — with proven, probable and possible energy reserves.
The impact of the two supplemental filings with the OTC is making itself felt in steadily rising prices for the stock — as oil and gas reserves at the well sites have been documented. Links to more news are at https://alliedengycorp.com/ and https://twitter.com/AlliedEnergyCo1