Rising Oil Prices Makes Reworking shallow Oil Wells Very Profitable
Allied Energy Corp (OTC:AGYP)
Allied Energy Corp. is an energy development and production company acquiring oil & gas reserves in some of the most prolific hydrocarbon bearing regions of the United States. The Company specializes in the business of reworking & re-completing ‘existing’ oil & gas wells located in the thousands of mature oil & gas producing fields across the United States. The Company applies its knowledge, experience, and effective well-remediation technologies to achieve higher production volumes, longer well life, and more efficient recovery of the proven and available oil and gas reserves in the fields/projects in which it has acquired an ownership interest.
Broadly speaking, AGYP specializes in the business of reworking and re-completing existing oil and gas wells located in the thousands of mature oil and gas producing fields across the United States, with the objective of mobilizing its expertise and technology to drive higher production volumes, longer well life, and more efficient recovery of proven and available oil and gas reserves in acquired wells.
Technology with roots in producing electronic and battery cooling solutions for NASA space missions and transitioning into mass market commercialization.
Key target markets include:
• Aerospace and Defense
• Battery Safety and Testing• Utility Level Energy Storage
• 5G, Cloud Computing, and Consumer Products/Electronics
• Shipping and Logistics (packaging solutions)
• Electric Mobility
• Attractive and scalable business model with high gross margins (73%)
• Robust patent portfolio and 28 customer engagements across multiple industries
• Experienced management team with high insider ownership (+52%
Innovative High-Performance Thermal Management Solutions for Today’s Industries and Emerging Technologies
Invest in companies you believe in.
“It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.”
— Warren Buffett
Byers Heirs #2 Deu Pree Field, Wood County
Byers #1, Deu Pree Field, Wood County
Cameron #1, Deu Pree Field, Wood County
Continental State Bank #14, East Texas Field, Gregg County
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Changing the Landscape of Energy Management and Development With Revolutinary Techniques
The Company will utilize updated technologies such as hydraulic fracturing (“fracking”),
drilling of lateral (“horizontal”) legs in productive zones, and utilizing new
cased hole electric logging to locate bypassed pays, all to enhance daily
rates and oil & gas recoveries
Business of reworking & re-completing “existing” oil and gas well located thousands of mature oil and gas fields across USA
There are proven, recoverable reserves contained in the many aging oil & gas fields that have been bypassed by companies moving away from these fields in search of deeper, more plentiful, but more costly reserves.
Evolution of AGYP Projects
Green Lease Project
Annie Gilmer Project
AGYP (OTCMKTS:AGYP)Bears May Why Allied Energy Bears May Face Tough Times Ahead
Today Allied Energy (OTCMKTS:AGYP) is in an interesting position right now.
In the first case, OTCshortreport.com shows AGYP shares to be overwhelmingly popular among active bears, with nearly 5 million shares of short-side transactions over the past few days making up almost 55% of all transactions in the stock over that period.
For a typical stock, that percentage is generally much closer to 5-10%. Overall, the percentage of short to long transactions is generally under 10% across the market as equities are asymmetric as an asset class (unlike commodities or currency pairs).
The fact that AGYP has been so heavily shorted is not immaterial to analyzing the future potential path for the stock because it implies an increased potential for a short squeeze dynamic to take place on further strength.
Short squeezes take place simply because the upside for any stock is “infinity”, at least in theory, so risk is unlimited for shorts. At the same time, it is defined and limited by a move to zero (except in commodities, as longs found out in crude oil last year) for longs. In other words, the lowest a stock can go is zero, but the highest it can go is infinity.
That dynamic is sharply exacerbated when a stock is “crowded” by simultaneous bets from different market participants all looking to profit from a move lower. That crowded dynamic introduces the potential for competitive bidding if it that bear trade starts to go wrong.
Imagine the last “Tickle Me Elmo” on Christmas Eve 25 years ago or toilet paper during the early months of the pandemic if regulators were not part of the picture.
Shares of a stock that are crowded on the short side with a multitude of different shorts sitting encamped and possibly leveraged up that start to rally can and frequently do set off a panic to buy to reduce exposure to potentially unlimited losses.
This is especially true at a time when faith has been weakened that there is a relationship between the price of a share of stock and the fundamentals of a company, such as we have seen with GameStop Corp (NYSE:GME), AMC Entertainment Holdings Inc (NYSE:AMC), and Fubotv Inc (NYSE:FUBO) earlier this year.
AGYP recently put out a comprehensive corporate update that explains its overall strategy, and that’s worth checking out. The strategy appears to be centered on diversification and selectivity in target wells
- The company recently announced that it has submitted and posted its bond for the P-4 and P-5 applications to the Texas Railroad Commission.
- Allied is waiting on the Texas Railroad Commission to accept their bond and active the P5 operating permit.
- According to the company’s release, Allied has secured Oil Cat Energy Services for the filing of the necessary Underground Injection Permit for saltwater injection for the Green lease.
- Allied will reportedly use Oil Cat Energy Services as the go-to solution for surveying the plat for the precise injection well location, for securing the drilling permit for the injection well, for engineering services and consulting, and for workover engineering for new production well set-ups for increased fluid production rates.
Allied Energy Corporation CEO, George Montieth added: “We are extremely excited about our recent acquisition of the Palo Pinto wells and have a high confidence that these wells will become part of Allied Energy Corporation’s oil production numbers. These formerly producing wells are perfect candidates for modern reworking and recompleting technology that will give these old wells new life. In many cases, the most productive days are still ahead for some of these wells!”
Why Oil Stocks May Never Recover From the Coronavirus Crisis - AGYP Benefits ?
COVID-19 isn’t going away anytime soon
Let’s start on the demand side of the equation for oil. We don’t know when the U.S. economy or the global economy will return to “normal,” but it doesn’t appear it’ll be anytime soon. In recent reports, the American Enterprise Institute and the Center for American Progress outlined plans for reopening the economy and what to do if and when COVID-19 returns periodically. And neither report is particularly bullish on an economic recovery anytime soon.
The American Enterprise Institute pushes for a regional approach to handling COVID-19 and getting the economy going, triggering into and out of stay-at-home advisories as case counts grow and shrink. The implication is that the U.S. would go in and out of some level of quarantine for the foreseeable future, leading to what it’s dubbing the “80% economy.” With a vaccine not expected for 18 to 24 months, the ups and downs of the economy could last some time, hurting oil demand as a result.
The Center For American Progress report has similarities but pushes for massive increases in testing and contact tracing. There would also be restrictions on travel and only a slow reopening of parts of the economy. There’s no plan for a rapid recovery.
In both plans, it’s going to be many months, if not a year or more, before COVID-19 is under any kind of control and the economy can fully reopen again. For oil demand and oil prices, that could mean a rough 12 to 24 months ahead.
How Bad Is The Oil Demand ?
The impact on oil demand during our current state of suppressed economic activity is clear. Demand is going to be significantly lower as fewer people travel, and there may not be an end to the decline in demand.
If we just look at some of the more travel-centric uses of oil, we can see a significant long-term reduction in oil demand on the horizon. According to the EIA, jet fuel typically accounts for 7% to 8% of oil demand in the U.S., and demand was down 56% between the week of March 13 and the week of April 3. There’s little reason to think air travel will return to any kind of normal anytime in the foreseeable future. No plan to contain COVID-19 will be without suggestions to reduce travel, if not severely restrict it, so reduced air travel alone will be a hit to oil demand for a long time.
Motor gasoline is about 45% of U.S. oil consumption in the U.S. and between the week of March 13 and the week of April 3, demand for motor gasoline dropped a whopping 48%. It’s likely that work-from-home policies will be in place for the foreseeable future, cutting down daily commutes and putting a damper on demand for oil that could last for a long time. A near 50% drop probably isn’t sustainable, but a long-term reduction of double-digit percentages for over a year isn’t out of the question if the distancing policies and travel restrictions outlined above continue.
These numbers are from the U.S., but we’re seeing similar trends around the world. Demand for oil is going to be down, and the reduction may last longer than some anticipate.
Companies Like AGYP could benefit BIG !
Allied Energy Corporation Leases Five Additional Texas Oil Wells at the 300 Acre Annie Gilmer Lease.
Carrollton, Texas–(Newsfile Corp. – May 17, 2021) – Allied Energy Corp. (OTC Pink: AGYP), an energy company focused on leasing and reworking oil and gas reserves in the most prolific hydrocarbon areas of the United States, is pleased to announce that the Company has leased 300 acres containing five additional oil wells in Crystal Falls, Texas identified as part of the Annie Gilmer Lease.
Allied CEO George Montieth elaborated on the acquisition: “We are thrilled to add the Annie Gilmer Lease wells to our ever-expanding portfolio of Texas oil wells. Allied currently has a crew on the ground this week at this new location and expects to release flow rates, videos and other pertinent data shortly. Investors can also expect updates about our Green Lease location as the workover rig is now just waiting on weather to move onto the lease.”
AGYP Revenues Could Grow 500% on New Well Projects
The Bottom Line:
With its low-float and recent announcements, we believe that AGYP is in for a huge week of trading.
The Company is in the midst of a major growth period, and we believe it has the potential to double in price from here.
AGYP already has strong revenue growth, and is in possession of cutting edge technology in some of the fastest growing oil sectors.
We believe that AGYP is extremely undervalued at its current levels.
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