New York, NY / ACCESSWIRE / September 2, 2014 / SeeThruEquity, a leading independent equity research and corporate access firm focused on smallcap and microcap public companies, today announced that it has initiated coverage on Deep Well Oil and Gas, Inc. (OTCQB: DWOG), an emerging independent oil sands exploration and production (E&P) company operating in the Peace River area of Alberta, Canada.
“DWOG is an interesting play on exploration and production in the Alberta region and is making good operational progress on its two government-approved thermal recovery projects. 97% of Canada’s vast oil reserves are located in the Alberta region in which the company operates,” stated Ajay Tandon, CEO of SeeThruEquity. “We are initiating coverage with a target price of $0.94,” continued Ajay Tandon.
Additional investment highlights are as follows:
Canada has the third largest oil reserves in the world, 97% of which is located in the Alberta oil sands. Relative to other regions, Alberta enjoys several advantages. Development has accelerated recently due to technological advances. In addition, the area is home to a generation of field operators with extensive technical experience in oil production. Recovery factors in the area are also on the rise for the thermal processes that Deep Well utilizes. Finally, Canada, with a long-term and predictable government, is a politically stable country. Within Alberta, the Sawn Lake area (which is where Deep Well is focusing on) is close to existing infrastructure such as crude oil and gas pipelines, making it easier to fuel its thermal recovery projects and eventually carry its future produced oil to market. In addition, the planned construction of several all-weather roads should give Deep Well better year-round access to its lands.
Operational Progress towards Production
Although Deep Well is an exploration stage company that does not have any production yet, it is making good operational progress on its two government-approved thermal recovery projects. The company entered into the first project, which involves a technology called Steam Assisted Gravity Drainage (SAGD), with two joint venture partners while receiving funding from a third party. To date, Deep Well has drilled 12 wells while acquiring more than 125 miles of seismic data. The operator estimates average production from its first SAGD well pair, which is currently underway and steaming, to initially be 500 barrels per day. Depending on the results of the first well pair, the company anticipates drilling an additional two SAGD well pairs. The second project, which uses Horizontal Cyclic Steam Stimulation (HCSS), is awaiting preliminary results from the first project before starting up. The operator estimates preliminary first cycle production from its first two HCSS wells to be 1,000 barrels per day. As Deep Well gets closer to eventual production, investor sentiment on the stock should improve.
Deep Well is one of the few oil sands leaseholders at the pre-production stage of their development out of approximately 50 publicly-traded companies. Hence, as production from Canada’s oil sands ramps up, investor demand for exposure to the area could increase, which would benefit the stock given its unique position as a pure-play bet on successful exploration and eventual production in the Alberta region.
The report is available here: DWOG Initiation Report. SeeThruEquity is an approved equity research contributor on Thomson First Call, Capital IQ, FactSet, and Zack’s. The report will also be available on these platforms.
Please review important disclosures on our website at http://www.seethruequity.com/.
About Deep Well Oil & Gas, Inc.
Deep Well and its Canadian subsidiaries, Northern Alberta Oil Ltd. and Deep Well Oil & Gas (Alberta) Ltd., have a 90 per cent working interest in 51 contiguous square miles of oil sands leases, an 80 per cent working interest in 5 contiguous square miles of oil sands leases and a 25 per cent working interest in 12 contiguous square miles in the Sawn Lake oil sands area in North Central Alberta. The leases cover 17,408 gross hectares (43,015 gross acres) of land.
Deep Well Oil & Gas, Inc. is fully committed to best practices in Environmental Stewardship to assure sustainable development of its in-situ heavy oil holdings. Deep Well is a Nevada corporation based in Edmonton, Canada.
SeeThruEquity is an equity research and corporate access firm focused on companies with less than $1 billion in market capitalization. The research is not paid for and is unbiased. We do not conduct any investment banking or commission based business. We are approved to contribute our research to Thomson One Analytics (First Call), Capital IQ, FactSet, Zacks and distribute our research to our database of opt-in investors. We also contribute our estimates to Thomson Estimates, the leading estimates platform on Wall Street.
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