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Thursday, March 13, 2014
This summer, a small Colorado-based energy company is going to shock the oil industry.
You've likely never heard of this company.
Your broker hasn't heard of it, either. Neither has your mutual-fund manager.
This company is privately held. It doesn't have a stock ticker. It doesn't trade on the NYSE or the Nasdaq. It doesn't file public documents. You have to be an insider – or know one – to understand what's going on.
Fortunately, I have that kind of access. I have a friend and close contact who is involved with this company... and knows exactly what's about to happen.
This company is about to reveal secret geological data that will kick off a "land rush" in West Texas.
It will likely start this summer. And it's going to send the share prices of some small oil stocks much, much higher in the coming years...
Fortunately, we already have a roadmap for investing in the next land rush. We know how it will play out, because it has happened before... in the Barnett Shale in Texas, the massive Bakken Shale of North Dakota... and the famed Eagle Ford Shale of southeastern Texas.
These land rushes have produced share-price gains of 85% in eight months, 50% in 15 months, 111% in five months, and 65% in five months (just to name a few) for investors.
We need to act right now to set ourselves up for similar gains. For me, it all started with...
"Matt, it's going to happen again. Enduring is getting ready to sell..."
On February 20, a geologist friend of mine called to tell me one of the best shale developers in the country, Enduring Resources, was quietly selling off its assets in West Texas' Permian Basin.
Four years ago, we had a similar situation with the Eagle Ford Shale in southern Texas. The "sweet spot" of the Eagle Ford was the Hawkville Field. Leases in that area were expensive and popular, because it was already proven. So Enduring acquired ground wells to the north of this area.
They got into this land cheaply because it was far from Hawkville. But Enduring's geologists understood the rocks. They realized the shale trend would run directly through their land leases... and it did.
Mid-tier oil company Talisman Resources and partner Statoil bought Enduring's Eagle Ford acreage for $1.33 billion. That works out to $13,600 per acre, a 36% increase over the price Talisman paid for other Eagle Ford acreage just a year earlier.
The Enduring deal became one of the benchmarks to value Eagle Ford land. After that, more and more companies moved into the Eagle Ford... and they massively bid up land prices. Both public and private companies made a fortune during this "revaluation" process. Now, the Eagle Ford is one of the most prolific shales in America.
My friend expects Enduring's latest asset sale – in the Permian Basin – to go through by summer. As part of the sale, Enduring will reveal all its data from the region... and rumor has it that the oil volumes will shock the industry.
To those in the know, it signals the beginning of the next great growth play...
Right now, most companies focus on the western or "prime" part of the Permian. But as a private developer, Enduring can venture into the unknown. They can afford to take big risks. And as the company's deal should prove, there's also plenty of oil to the east...
Few people know about Enduring's asset sale because the company isn't public. And it closely guards its operations.
When I heard that Enduring was about to let the rest of the world know what it discovered, I knew a big jump in property values was coming... just like it did in Eagle Ford.
I visited the Eagle Ford before the Enduring deal was announced. At that time, I recommended three stocks on the Eagle Ford revaluation. They returned 45%, 64%, and 78%, respectively, in about a year.
But these property revaluations aren't unique to the Eagle Ford or the Permian Basin. They happen in all the shale plays... repeatedly.
As the Bakken Shale went through several revaluations, Whiting Petroleum's share price climbed 700% in just two years. Kodiak Oil and Gas climbed 225% in about the same time.
These revaluations quickly turn tiny oil companies into giants.
One is about to happen again... this time in West Texas.
In tomorrow's essay, I'll dive deeper into this "sleeping giant" shale play. And I'll explain why it's about to make clued-in investors a lot of money in the years ahead.
Find more of Matt's reports on America's greatest oil and gas fields – and the companies set to profit – here:
"Super Shale" Fields Just Discovered in Texas
"The most underrated shale right now is in the Wolfcamp Shale in West Texas. And there's one key company to watch here..."
The "Louisiana Eagle Ford" Could Be the Next Giant Shale Play
"If this play's potential is realized, the region – and the public companies operating in it – could enjoy a major boom."
A Vast, Hidden Source of Growth for Oil Companies
"Some of the country's top shale plays are going to see huge growth in the next few years..."
WE BET YOU DIDN'T KNOW THIS ABOUT EUROPE
Today chart displays one of the least-expected uptrends in the world... the slight uptrend in the euro.
Read investment newsletters for more than a week, and you're bound to hear about how bad things are in Europe. Unemployment rates are high. Socialist governments are deeply in debt and choking off entrepreneurship. According to many analysts, all this should make the area's currency, the euro, plummet in value.
Those negative factors might be bad for the euro in the future. But they haven't dented its value over the long term.
As you can see from the 10-year chart below, the euro has experienced big rallies and big declines since 2004. But all this action hasn't produced a lower value. The euro is actually worth more than it was 10 years ago. Despite all the negatives you hear about, the euro is doing fine.