It was announced this morning that the venerable investment banking firm of Kohlberg, Kravis and Roberts (KKR) was going big into natural gas with a $350 million investment into East Resources, a private company with a large land package (900,000 acres) and infrastructure on the ground in the Marcellus Shale, a non-conventional shale gas play located between New York and Virginia on the east coast. In related news, the front month NYMEX futures contract for natural gas hit $4.25 in recent trading and the research department of Suntrust Robinson Humphrey recently reiterated their 2010 forecast for natural gas of $7.50 per mcf (1 mcf = 1,000 cubic feet). Goldman Sachs research also recently weighed in on the discussion, targeting $85 dollar oil by yearend.
With rig counts down to multi-year lows, natural gas pricing looks to be on the uptrend over the mid to longer term, which bodes well for companies that have survived through the tough recent market for energy and have large tracts of prospective acreage to develop and bring on line.
While you can’t invest alongside KKR in East Resources (as they are a privately held company), you can gain exposure to upside in natural gas for your portfolio through ownership in junior energy groups such as Triangle Petroleum (OTCBB:TPLM) & (TSX-V:TPE), Dejour Enterprises (NYSE AMEX:DEJ) & (TSX:DEJ) and GeoPetro Resources (NYSE AMEX:GPR).
These three junior E & P companies are building out and developing highly prospective energy resources in 4 primary North American regions as follows:
Triangle Petroleum: 474,625 gross acres/270,000 net acres in the Eastern Maritimes of Nova Scotia. Dejour Enterprises: 150,000 net acres in the Piceance Basin of Western Colorado and the Peace River Arch/Montney region of BC, Canada. GeoPetro Resources: a producing gas field and wholly owned gas treatment facility in the highly productive Rodessa/Bossier Deep region of east Texas as well as four additional “company maker” projects.
Each of these companies is very well positioned to take advantage of a rising cost environment for energy and are working dilegently to produce from existing discoveries as well as identify new reserves to build value for their shareholders.
More about each of these promising junior energy growth stocks is available online at:
Triangle Petroleum Corp. www.trianglepetroleum.com Presentation at: http://www.dejour.com/docs/dejour%20corporate%20presentationapril09.pdf
Dejour Enterprises Ltd. www.dejour.com Presentation at: http://www.trianglepetroleum.com/en/triangle_pp_april_09.pdf
GeoPetro Resources – www.geopetro.com Presentation at: http://www.babybulls.com/GPR_Investor_Presentation_May-09.pdf