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October 28, 2008

Nighthawk Energy Predicts Rising Tide Of Production As Its Waterflood Projects Flush Out More OilNighthawk Energy Predicts Rising Tide Of Production As Its Waterflood Projects Flush Out More Oil

Nighthawk Energy expects to become a fully-fledged production company over the next 12 months as wells from its Jolly Ranch property in Colorado and its waterflood projects on the Missouri/Kansas border come online. The AIM-quoted company, which had enjoyed a heady rise in share price until the recent collapse in global equities, has been ploughing its money into developing its properties in the US Mid-West and that investment is set to be repaid as production climbs in the months to come.

The downer, of course, is that the start of the production rise has coincided with a steep drop in commodity prices, with prices that were north of US$140 a barrel in July now down by 60 per cent or more at around US$60 a barrel. Fortunately, this is low cost production: the waterflood project wells, for example, can be sunk for around US$40,000 each and can payback investment within six months based on a US$60 oil price.

Despite the current economic gloom, the company reckons its short term...