THK's 5000 acres has the potential to hold about 50bcf of gas. Gas is selling at USD13 per mmbtu at the moment. So at a very very consertative valuation of USD 3 million per bcf, THK is worth about USD150 million. This is many multiples of the stock's current market cap.
With the JV agreement with Metro and the US Independant, THK has access to a net of another 23,000 acres of prospective land. This could lead to reserves of another 200bcf of gas. That would be another USD 600 million's worth. Gas in the US in one of the best energy exposures you can have at the moment as demand is increasing and production is falling. Imported LNG will not bridge the gap in the US in the short term which can keep gas prices sustanably high. Try USD10 per bcf in valuation and the mind starts to boggle. Well worth the punt in my opinion and I hold a position. And anything you pay now at below 66c and 75c is less than the previous equity issues, so you are buying CASH at a discount as well (THK's cash holding is aound 7 million).
THK
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