NEW PICK:Mainland Resources, Inc. (OTCBB)
MNLU
Currently Trading: $1.29
Mainland Resources, Inc. is an independent oil and gas exploration, development and production company formed in early 2008. The company is currently engaged in the exploration and development of 2 oil and gas prospects in the U.S., ( The DeSoto Parish Prospect, and the Mississippi Prospect.)
Just 2 days ago MNLU announced the completion of a $28.2 Million dollar sale of 40% of the company's interest in the Haynesville Shale zone!
What's the Haynesville Shale Zone? And Why Is This Important?
In 2008, in the Louisiana Salt Basin, a major natural gas discovery was made in the Haynesville, Cotton Valley, and Bossier formations of Northwest Louisiana .
This region is now considered to be the fourth largest gas field in the world, and just 2 years after its discovery, it is already a largely successful gas play controlled by major natural gas producers.
The Haynesville shale discovery is expected to yield more than 160Tcf (Trillion Cubic Feet) of gas, which would make it the largest shale resource in the entire United States!
Mainland Resources (MNLU) drilled their first successful well in the center of the Haynesville shale region (the DeSoto Parish Prospect) in 2008, and have been aggressively expanding operations ever since. Along with their joint venture partner Petrohawk Energy, they have drilled four Haynesville wells to date, with a 100% success rate!
Major Developments Over the Last Two Days:
On April 28 th 2010, MNLU announced the final details regarding the sale of 40% of the company's interest in its Louisiana Haynesville production (the DeSoto Parish Prospect), for $28.2 Million Dollars!
Here's the best part:
As part of the agreement, the company was able to retain 100% of all of the production in the Cotton Valley zone (located above the Haynesville region)
MNLU expects that the remaining interest still held in the DeSoto Parish prospect will continue to be a valuable source of revenue for the company, while the proceeds of the sale will help MNLU have sufficient funds on hand to start major drilling operations in the Buena Vista and East Holly wells in Northern Louisiana!
The company plans to commence drilling in late May or early June 2010 on both the Buena Vista and East Holly prospects.
Another Huge Development:
MNLU also announced just days ago, that they had increased the company's working interest in the Burkley-Phillips No.1 well ( the first well on the Buena Vista Prospect) from 46% to 72%! The company plans to commence drilling in just 30 to 60 days and now has majority interest to boot!
Major drilling to start on the Mississippi Prospect - 2nd quarter of 2010!
MNLU's Mississippi prospect is situated on what the company believes is an undiscovered Haynesville shale structure, based on proprietary information gained from previous drilling of a deep well located in the region. MNLU's management is convinced of its potential for major shale-gas production.
The management team is in the process of rolling out a comprehensive drilling plan to validate the potential of the Mississippi Haynesville Prospect by mid - 2010.
This flurry of major announcements coming from MNLU is fast and furious, and usually activity like this spawns major investor interest. Due to the fact that MNLU is already a successful oil and gas exploration company, and is re-investing profits from previous successes to spawn further growth in the company, I expect that we will see some heavy movement on MNLU over the next week.
Volume has ticked up slightly over the last few days, and usually when I see this, it's the sign of a rally that is about to take place.
As I said, I wanted to make sure I got this out to you early so that all members have time to research and review the company before considering. I think we could see movement as early as Monday morning, but it looks like their will be steady activity on MNLU over the next week or so.
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