Oil and Gas
Oil and gas, the foundational elements of our energy-dependent society, continue to hold sway despite the global shift towards renewable energy. These hydrocarbon-rich fossil fuels have been integral to global economic development, powering industries, transportation, and electricity generation. Furthermore, oil and gas are key ingredients in the production of a multitude of everyday items like plastics, cosmetics, and electronics. The oil and gas industry remains a significant job creator and revenue generator, contributing immensely to global economies.
The world’s energy consumption continues to be dominated by oil and gas. Rising global populations and industrialization are only expected to further drive demand of these commodities keeping them as an integral part of society.
The United States, particularly California, is a prime market for oil and gas. California is curently the 6th top oil producer and 8th overall in oil and gas production. On the flip side, California is the 2nd largest energy consumer next to Texas and is the biggest consumer of gasoline and jet fuel in the United States. Despite this, the state imports about 70% of its oil, 60% of which is from foreign sources. This marks a substantial increase from just two decades ago when foreign sources accounted for only 15% of California’s oil imports.
Trio Petroleum
Trio Petroleum Corp. (NYSE: TPET), is primarily focused on the heart of California’s oil industry, Monterey County, and aims to capitalize on this opportunity. This region is renowned for its oil and gas production, dating back to the early 20th century. Monterey County’s oil reserves are estimated at up to 21 billion barrels, making it a major oil-producing region in California.
Trio Petroleum’s flagship project, the South Salinas Project, is a substantial oil and gas resource spanning approximately 9,267 acres, nestled amidst California’s world-class oil-producing basins.
Trio’s Strategic Approach
Through the South Salinas Project, Trio aims to tap into Monterey County’s rich oil and gas reserves. The project boasts an estimated 39.0 MMBO and 40.0 BCFG in Probable (P2) Undeveloped reserves, and approximately 92.4 MMBO and 148.8 BCFG in Possible (P3) Undeveloped reserves.
In May, Trio commenced drilling operations at the South Salina’s HV-1 discovery well. A few weeks later, the company announced a substantial oil and gas accumulation at the Presidents Field within the project. The promising start bolsters belief in the significant potential of the South Salinas Project.
August 2nd, TRIO reported that production tests conducted at the HV-1 exploration well within the South Salinas Project yielded flow rates of around 125 barrels of oil per day (BOPD), along with accompanying natural gas and water and this was from the first of 3 zones to be tested .
Key Growth
Trio’s success at the South Salinas project could position it as a leader in helping reduce California’s dependence on imported foreign oil. Continuing to expand, Trio increased their ownership in May at South Salina’s from 8,600 acres to 9,267 acres, an approximate 8% increase.
TRIO has also been working to acquire other valuable assets. They recently signed Exclusive Options to acquire interests in three additional production operations: Union Avenue Field, Kern River Front Field, and Hangmen Hollow Field, all bringing further value to the company.
Why Trio Petroleum
Demand for oil and gas isn’t diminishing, and Trio Petroleum is well-positioned to capitalize on this opportunity. Here are several reasons to keep an eye on this emerging company:
- Trio is ready to drill in the heart of California’s oil industry. Their South Salinas project has already produced two wells, and Trio retains an 86% working interest and full operatorship.
- Drilling operations at the South Salinas HV-1 well confirmed a major accumulation of oil and gas within the project.
- Trio’s assets are nestled alongside Chevron & Exxon’s billion-dollar assets. Given the renewed focus of these “Majors” on North America, Trio has an advantageous position.
- Trio’s leadership, headed by CEO Frank Ingriselli, brings over 40 years of operating and producing experience in the region. Ingriselli, a former President of Texaco International, offers 43 years of public company experience. This will be his 4th successful public company listing on NYSE.
- Full independent reserve report published with SEC -Key valuation metrics: Cash Flow PV10: $2 billion and undiscounted Cash Flow PV is: $6.4 billion. So based on post-IPO market cap, the company would be at a significant discount to NPV value: 40X growth potential and based on comps for reserves, Trios value could be: 12X Growth potential.
Trio Petroleum’s strategic positioning in the heart of California’s oil industry, along with its promising South Salinas project and strong leadership, make it a compelling prospect in the oil and gas sector. Keep an eye on this emerging player as it capitalizes on the state’s insatiable energy demand.
