Strata-X Energy's strategy is capturing emerging petroleum exploration, develpoment, and production opportunities that have the following characteristics:
- Sound geologic framework with substantial untapped or unrecognized petroleum potential
- Low cost of entry
- Ability to acquire meaningful acreage positions
- High Net Revenue Interest's (NRI)
Strata-X Energy strives to be the first mover or early mover on opportunities it pursues. This strategy tends to lead the Company away from the main pack of the industry where leases can be prohibitively expensive for a small company and have lower NRI's. Further, Strata-X Energy’s management has a successful track record of recognizing and capturing growth opportunities in early stages which subsequently generated excellent shareholder returns.
While the first and early mover opportunities may not be considered ‘the flavor of the month’, Strata-X Energy believes that with exploration success in these areas, we can lead the industry into the next hot area, at the same time adding substansial shareholder growth.
The importance to the shareholders of Strata-X Energy of this strategy is that not only do we get ground floor entry costs, but when success is achieved, the return on investment could be much higher than if the company had been focused on the current “hot” plays.
Examples of how the first mover strategy has been hugely successful is through the early recognition of Strata-X Energy’s Chairman, Ron Prefontaine of the Coal Seam Gas potential in Australia long before it became a “hot” play in that country. Following the sale of his private company, Australian CBM, to Arrow Energy (a small ASX listed company at the time) in 2001, he was the executive director of Arrow Energy's early exploration success and reserves certifications which helped set Arrow on the path to a $3.5 billion takeover in 2010. Early shareholders of Arrow were rewarded with a handsome return on their investment. Similarly, as a co-founder and Managing Director of Bow Energy, which started with an IPO raising of $6 million in 2005, he oversaw the expansion of their petroleum portfolio and reserves until Bow was taken over in late 2011 for $550 million.
Strata-X Energy is Ron Prefontaine’s third position on a public company board and with his mission for the company to repeat the previous successes. He believes with the company’s assets and talented staff, this is certainly achievable.