"red hot penny stocks" tips range resources.

There is one way to make big money in the oil business you have to rough it. Its not enough to just follow the oil majors into the biggest oil
fields. There is no fortune to be made there. And you cant take the safe option either. I know of a few companies that are looking for oil in Lincolnshire. If you want a quiet life and the chance to pump a trickle of oil from the flat English countryside, that is fine. If you want the chance to make a real fortune you must be adventurous. Last year we ventured into one of the most inhospitable terrains on the planet for a penny fortune. Over the course of two sweet months we saw Gulf Keystones
share price jump from 13p to 105p.There was good reason for the big payoff it was a hugely risky venture. The reason Gulf Keystone was
able to secure its Kurdistan licences was because the giants of the oil industry were not bidding. Why? Because they had their eyes on the even larger prospects to the south of the country and did not dare upset the Iraqis by doing a deal with the Kurds. And this month I have uncovered another oil play in a country shunned by big oil. It is povertystricken,
war-torn and remote, a place in truth where only the boldest will go. But that boldness could very soon be rewarded. Later this year the first well will be drilled in this ravaged country for 16 years. And it could transform
the fortunes of one penny share explorer that could be sitting on 18 billion barrels of untapped oil.The secret documents that reveal an oil bonanza
It wasnt long ago the American oil men were swarming all over this country. When I was researching this amazing story, I came across two fascinating documents just recently declassified under the USA
Freedom of Information Act. The first is a cable from the US Embassy in
Mogadishu to the State Department Headquarters,
dated 21 March 1990. The largest and most purposeful enterprise going
on in Somalia at the present time is Conocos quest for oil... Conoco is investing in oil exploration in Somalia on a scale unmatched by its rivals, building roads and airstrips, chartering one of the national airlines three
planes full time, and sending seismic survey teams to the territory... the benefits to all if Conoco finds oil... are so apparent that no one has tried to kill this goose laying golden eggs. And the second is from the US Embassy in Djibouti to State Department Headquarters on 20 June 1991.
Concerning Conoco, US Ambassador Barretts source claims to have seen an internal document of Conoco (Somalia), which states that sites in the Garoe-Las Anod area are capable of producing 300,000 barrels of oil per day.You see, back in the early 1990s not just Conoco but the other US oil majors like Amoco, Chevron and Phillips were all over Somalia, attracted by one of the biggest geological clues to bumper oil reserves. Somalia is on the Horn of Africa. That is the bit that juts out to the east and is separated from the Middle Eastern state of Yemen only by the narrow expanse of the Red Sea. But about 18m years ago, before tectonic
forces prised the Indian plate away from the African plate, there was no Red Sea and Yemen and Somalia were just one land mass.
And here is what makes the story so exciting, and explains why American oilmen were swarming all over the country 20 years ago.
In the 1980s the Hunt Oil Corporation found multibillion barrel oil reserves in the Marib-Shaba and Masila basins of Yemen. And geologists believe that
these same oil-bearing sedimentary rock formations are part of a great underground rift that continues on the other side of the Red Sea in Somalia. Yemen has 5-10 billion barrels of oil, but Somalia could hold considerably more. In fact an independent assessment of the potential reserves of just two Somalian blocks, Nogal and Dharoor, amount to 18
billion barrels. But the Americans are no longer here. In 1991 warlords overthrew US-friendly dictator Mohamed Siad Barre and despite the best efforts of the Bush government to retrieve the situation the Americans were driven out and would not be welcomed back today.
So today the exclusive rights to all mineral and hydrocarbon exploration and development in an area covering the northernmost third of this large country are held by one tiny adventurer, Range Resources and that includes the rights to those two huge oil prospects. How has this come about?

{Somalians are welcoming this oil adventurer with open arms}

Ranges licence was awarded by the government of Puntland. Puntland is a semi-autonomous state to the north of Somalia populated largely by migrants from the war-torn south. This is a state that has had enough of misery and war. Its people believe that differences should be resolved through dialogue and negotiation rather than through the barrel of a gun. Based upon this noble principle, Puntland established its own government in 1998, has devised a five year development plan and is a
beacon of hope for the rest of the country. So it was the Puntland Government that granted Range its mineral and hydrocarbon rights in 2006. But rather than go it alone Range brought in partners to finance and help to develop the Nogal and Dharoor oil prospects. Today Africa Oil and Lion Energy (both listed on the Toronto Stock Exchange) have 65% and
15% interest respectively in these two blocks, leaving Range with 20% still more than enough to transform its value if Nogal and Dharoor have anything close to 18bn barrels of oil.
Soon we will find out. Because after the Puntland government ratified the licences in December the operator Africa Oil is set to sink the first well for 16 years on these vast prospects later this year. Data gathered in the past has been reviewed, seismic surveys have been completed in the last two years and the first well should be drilled on the Dharoor prospect in the third quarter, followed by a second before the end of
the year. These have the potential to transform both the value of Range Resources and the prosperity of Puntland. But this venture is not Ranges single shot. Why Range could multiply your money 500% Range has a number of very lucrative sidelines. It is already producing gas in Texas and has another high risk play in the former Soviet state of Georgia.In Georgia, Range has spent about $5m on seismic surveying in order to earn a 50% interest in two oil and gas blocks. This is a highly prospective region that is
well served by pipelines linking central Asia with the Black Sea. Based on the seismic data, drill targets should be identified later this year.But in Texas, Range is already receiving revenue. Here it has a 25% interest in the first well from the North Chapman Ranch project, where an oil and gas
discovery was made last December and production started in February. Just last month an independent report revealed the significance of this find. On the basis of an estimated total reserve of 215bcf of natural gas, 16mmbbls of oil and 15mmbbls of natural gas liquids, the value of Ranges 25% interest (after the applying a 10% annual discount rate to forecast cash flow) is $226m some five times Ranges stock market value. Range has a 20% interest in subsequent wells here, and the second is now being
drilled. So although such a valuation of underground reserves, the majority of which are unproven, is an inexact science, Ranges stock market value seems to be fully supported by its risk-free Texan producing interest,
leaving the exciting stuff in Georgia and Puntland in the price for free. This is a great risk/reward proposition and makes the shares a clear buy.
RHPS Verdict: It is extraordinary to find a penny share company with sole mineral and hydrocarbon rights over an area about three-quarters of the size of Italy. The risks here are undoubtedly high but, in the
words of its government Puntland has potential natural resources waiting to be tapped. Lucky are those who come first... the early bird catches the worm. I am hoping that Range will find more than just worms under Puntland soil, and we should soon find out. With a target price of 20p, BUY UP TO 5.5p