QIS Update #12 2012 - April 15th 2012
Included in this update:
- Blackbird Energy announces Bigstone drilling and operations update
- Virtutone Networks enters VoIP wholesale market
It’s been a crazy week with a couple of significant news releases outlined below, and our Vancouver Conference. We’d like to thank all of our presenters, sponsors and attendees for making Tuesday’s Vancouver Small-Cap Conference a success. There was a good turnout despite the relative weakness in the markets this month (TSX Venture down approximately 8% since April 1). The company presentations from this event will be available soon at www.smallcapconference.ca/presentations.php. We also have a conference coming up in Calgary on May 10. It is free to attend and you can register online at www.smallcapconference.ca/register.php.
Please feel free to email us anytime at email@example.com or call us at (250) 377-1182. We look forward to your comments, questions, and feedback.
Blackbird Energy Inc. (BBI:TSX-V)
Current Price: $0.16 (coverage commenced Aug 19/11 - $0.18)
Blackbird Energy Inc. has provided the following update on its Bigstone, highly liquids rich natural gas resource project.
- The well 13-33-060-22W5 has been drilled to total measured depth of 5,336 meters with a 2,590 meter horizontal length;
- Surface production facilities located in Lsd 3-29-060-22W5 and the 1.6 mile, 8 inch pipeline to the Delphi operated gas gathering system tie-in point has been completed;
- Production from our wells is anticipated to commence mid to late April, 2012 upon completion of certain operations by Delphi at the Lsd 1-19 tie-in point; and
- Fourth Montney extended reach horizontal well location surveyed and anticipated to spud in June 2012
Further to Blackbird’s press release of February 2012, and pursuant to the "Cross-Conveyed Pooling and Participation Agreement" covering the pooling of the P&NG rights in the Triassic Montney formation held by Blackbird and partners in Section 28-060-22W5 with those held jointly by Trilogy Energy and TAQA North in the adjacent Section 33-060-22W5, the initial extended reach, horizontal Joint Well on the Pooled Lands was spud on March 4 and reached total depth on April 2, 2012. The well 13-33-060-22W5 was drilled from its surface location at 4-28-060-22W5 to a total measured depth of 5,336 meters with a 2,590 meter horizontal length. In accordance with the agreement, Trilogy will assume the role of operator during the completion phase of operations. The well is currently being conditioned to run a liner and packer assembly in preparation for conducting a multi-stage (up to a 27 stage) fracture program. Completion operations are scheduled to be underway as soon as practicable. Blackbird holds an undivided 12.5% pooled interest in the Pooled Lands and participated as to a 12.5% working interest in the drilling of the 13-33-060-22W5 well.
The 13-33-060-22W5 well was drilled through the Montney at excellent penetration rates with strong gas shows. The well is located approximately 0.5 miles directly east and runs parallel to our recently drilled and completed extended reach horizontal well, 15-32-60-22W5 (25%WI). The 15-32-60-22W5 well was also drilled at excellent penetration rates with strong gas shows.
The installation of surface facilities, including 3 phase separators, line heaters, tanks, measurement and monitoring equipment and construction of a 1.6 mile, 8 inch pipeline to tie-in to the Delphi operated gas gathering system has been completed (Blackbird holds a 31.25%WI in the system). The site of the facilities is the same surface location used to drill the 14-29 and 15-32 wells, 03-29-060-22W5 and both will be produced through the facilities. The pipeline will carry gas and liquids from our facilities to the Delphi system tie-in point in Lsd 01-19-060-22W5. Production from our wells will be ready to begin as soon as Delphi completes certain construction and start up operations at the 1-19 tie-in point, anticipated to be mid to late April. The pipeline right of way to tie-in the 13-33-060-22W5 well has been surveyed and laying the line is tentatively planned to begin in June, contingent upon surface access conditions.
Donnybrook has informed Blackbird that it has surveyed a number of new drilling locations and is planning to drill the next extended reach horizontal well on one of the locations on the west side of our Bigstone acreage block (25% W.I.) in June 2012.
Garth Braun, CEO states, We are very pleased with the progress made to date on both the drilling operations and the completion of the production facilities. We feel that this marks a very significant stage in the development of our Company and the Bigstone project. We are looking forward to further success in the project as we move to production and continue to pursue our drilling program.
QIS Capital Comments:
Down to the critical time again for Blackbird as the company and its partners prepare to frac and complete their third Bigstone well. As announced, Trilogy is planning to complete a 27-stage frac on the third well, which is one of the largest planned to date in the area. We expect to see results in the next 2 weeks along with the commencement of production from the new pipeline and gathering facilities. Furthermore, Blackbird has announced that it is preparing to drill a fourth high-impact well in June in which it will hold a 25% working interest.
Virtutone Networks Inc. (VFX:TSX-V)
Current Price: $0.17 (coverage commenced Sep. 9/11 - $0.10)
Virtutone Networks Inc., a leading provider of Internet-based telephony services, has announced that it has launched a wholesale division which provides telephony services to other carriers. As a carriers' carrier, Virtutone will supply wholesale voice services, using Voice over Internet Protocol (VoIP) technology, to telephone companies, cellular companies, corporate clients, cable television companies, call centers, and Internet-based telephony companies.
Virtutone has selected Sonus Networks (NASDAQ:SONS) of Westford, Massachusetts to provide a new high-powered wholesale infrastructure which currently has the capacity to supply 1.2 Billion minutes per month to Virtutone customers. As the wholesale division continues to grow, this system is quickly and easily scalable beyond its current limits. The Virtutone network will be built on the Sonus Session Border Controller 5200 which is purpose-built for large scale, mission critical SIP-based communications. Virtutone expects the investment in this new platform to enable it to become a leader in the wholesale VoIP market in North America.
In addition, Virtutone has signed interconnect agreements with several of the largest telecom companies in North America, Australia and the United Kingdom to be able to provide the highest quality origination and termination services at reasonable prices. Virtutone is able to provide telephone numbers in over 12,000 local exchanges in North America, Australia and the United Kingdom, and in over 60 other countries worldwide.
Virtutone's growth over the last three years has increased our purchasing power, particularly in Canada. This has allowed us to provide extremely cost effective wholesale services, even to large telecommunication companies. In today's telecommunication world, competitors buy and sell wholesale communication services from each other to augment their core offerings. Our entry into the North American wholesale market will allow a wide variety of telecommunication companies to purchase high quality origination and termination services at more competitive rates, said Jason Allen, Virtutone's President and Chief Executive Officer.
QIS Capital Comments:
Congratulations to Virtutone for being our latest 100% gain as the stock reached $0.20 on this positive development. With this arrangement in place, the company expects to be catapulted to leader status in VoIP and FoIP in the North American market. While we expect to see some additional costs in the fourth and first quarters as Virtutone needed to acquire additional infrastructure to handle this expansion, the financial benefit of the agreement is expected to be immediate and significant. The company expects to achieve excellent margin on resale pursuant to this agreement which should provide a substantial boost to earnings during 2012/2013. The financial impact should be evident in Virtutone’s second quarter (May-July) which will be reported prior to the end of September 2012.
Disclaimer: This article is for informational purposes only. The information contained within this article should not be construed as offering investment advice. Those seeking direct investment advice should consult a qualified, registered, investment professional. BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. The company profiled assumes no liability for the information presented. This is not a direct or implied solicitation to buy or sell securities. Readers are advised to conduct their own due diligence prior to considering buying or selling any stock. The author(s) owns directly or indirectly 520,500 shares of Virtutone Networks Inc., and 88,500 shares and 450,000 options of Blackbird Energy Inc. QIS Capital may have a financial relationship with these companies and may trade in the stocks mentioned. No stock exchange has approved or disapproved of the information contained herein. Copyright © 2003 - 2012 QIS Capital Corporation.