Jericho Energy Ventures Inc. (JEV:TSX.V; JROOF:OTC PINK: JLM:FRA) and a joint venture partner have agreed to sell some of their undeveloped acreage in the STACK oil region of Oklahoma.
Jericho holds a 26.5% interest in the JV, which was paid US$1.37 million for the land.
The stock has been showing signs of basing in recent months, wrote technical analyst Clive Maund on his CliveMaund.com on Tuesday. The STACK sale “should of course bring money into the company,” he said.
“The pattern from late 2017 looks like a lopsided cup and handle base with a deep droopy handle forming due to the vertical runup early in 2021 being so extreme,” Maund wrote. “If so, we may be at a very good entry point here with the price having dropped back to a zone of strong support to complete the handle of the pattern.”
STACK stands for “Sooner Trend (oil field), Anadarko (basin), Canadian and Kingfisher (counties).” Northwest of Oklahoma City, the play targets multiple stacked formations for oil and gas production.
“The conclusion is that Jericho is a speculative Buy here for all timeframes, and the news out this morning could get it moving,” Maund wrote.
The Catalyst
Jericho officials said they believe that years of underinvestment and geopolitical events have buoyed oil and gas prices, bringing higher land acquisition and drilling activity back to the STACK play.
“With this divestiture to a top-tier operator, we increase the likelihood that new offset drilling activity will become nearly contiguous to JEV's entire STACK position,” Jericho Chief Executive Officer Brian Williamson said.
Pivoting Toward Green Energy
Once an oil and gas business, Jericho has been transitioning to green energy since June 2020. It still has oil and gas interests, such as in the STACK play, but is using the money from rising prices to help fund its push toward hydrogen.
Recently, an independent third-party firm rated the company’s zero-emissions hydrogen boiler technology as nearly 100% fuel efficient.
Earlier this month, Jericho announced that the Dynamic Combustion Chamber™, or DCC, boiler is being considered for deployment at major facilities around the world. Feasibility studies are being conducted or considered at 34 locations across seven industries and five continents, the company said.
As Maund once wrote for Streetwise Reports, hydrogen “is a fuel of the future.”
“DCC clean steam generation offers a novel, immediate, cost-effective solution to reducing their operational emissions,” Williamson said. “We anticipate seeing some of our current feasibility study clients move to secure the DCC for deployment at their facilities in the coming months.”
As companies shift toward greener energy sources and look to lower their carbon footprint, Jericho hopes its boiler technology will be there for commercial heating, hot water, and industrial steam boilers.
Hydrogen Technologies, a fully owned subsidiary of Jericho, has patented its method for burning hydrogen and oxygen in a vacuum chamber to create high-temperature water and steam with no greenhouse gases or other pollutants. The only by-product is water, which is recycled. It’s meant to replace existing boilers that burn coal, natural gas, diesel, or fuel oil.
The U.S. Department of Energy said the hydrogen market “is in its infancy” but that it has the “potential for near-zero greenhouse gas emissions.”
The element is the most abundant element in the universe. It’s stored in water, hydrocarbons (such as methane), and other organic matter.
As Maund once wrote for Streetwise Reports, hydrogen “is a fuel of the future.”
Ownership, Coverage, and Share Structure
Top shareholders in Jericho include Michael L. Graves Inter Vivos Trust with 16.43% or 37.13 million shares, McKenna & Associates LLC with 10.78% or 24.36 million shares, the CEO Williamson with 1.26% or 2.85 million shares, company Director Allen Wilson with 0.87% or 1.97 million shares, and Nicholas W. Baxter with 0.5% or 1.14 million shares.
The company is covered by newsletter writers of Clivemaund.com, of 321gold.com, and Chris Temple of The National Investor. Click "See More Live Data" in the data box above to see more of what they are saying about Jericho Energy.
Jericho has a market cap of CA$75.65 million with 226 million shares outstanding, 158.3 million of them free-floating. It trades in a 52-week range of CA$0.84 and CA$0.31.
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1) Steve Sobek wrote this article for Streetwise Reports LLC. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
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