I think AEXP is ready to FLY

I love Oil and Gas penny stock plays.  With the right company, the gains can be extraordinary.  Price moves of 400% to 1,400% are not uncommon from what I have seen.

There is an undiscovered oil and gas small cap stock that I feel is ready to bring to my members.  It is American Exploration Corporation (AEXP). The company is engaged in the exploration and development of oil and gas prospects in the continental United States.  It is a nice little company that has been under-the-radar and now is becoming known.  Once the market sees this stock, I could easily see HUGE GAINS.

Here is a case in point of what I mean about “extraordinary gains”. Take a look at Avro Energy (AVOE) was a penny stock that got HOT!  The chart demonstrates just what I am talking about.

AVOE got HOT, retail investors became aware of the stock and it SOARED! A 560% GAIN followed by a 1,400 % GAIN…That is AMAZING. There is no way to know if AEXP could pull a move like AVOE, but i want to make aware of it today in case it does.

So, who is AEXP?

AEXP is an exploration company focused on natural gas.  The company is pursuing an initial natural gas prospect located in the Gulf Coast Salt Basin trend, also known as the Haynesville Shale Prospect. AEXP has signed an agreement securing lease interest in approximately 5,000 acres of shale gas property, with an option to acquire additional interest in surrounding lands.

What is Shale Gas?

Shale gas is natural gas produced from shale rock.  The gas is trapped in the porous rock and most shale deposits have not historically been large producers of natural gas. But the NEW TECHNOLOGY allows AEXP to be able to cost-effectively extract the gas.

What is so special about the Haynesville Shale Prospect?

If you want the inside track to the best fields for natural gas, then you need to know about this region.  Using new recovery methods, the Haynesville Shale Prospect has emerged as an ENORMOUS gas resource.  IN FACT, it is now projected to be the largest onshore gas field in the United States.

AEXP already has a great deal of information about the viability of their first prospect.  WAY back in 1981, Chevron dug a test well on the property confirming the presence of gas on the property.  The technology did not exist, nor were the prices high enough to warrant Chevron developing the property.  FAST FORWARD to 2009 and AEXP has proof that they have a property with exceptionally high gas rates and Chevron’s data indicated that this section of the prospect has an extremely thick “prospect layer” (the area where gas will be extracted from).

And then AEXP got CONFIRMATION on their field yesterday!

Schlumberger, a global oilfield and information services company, completed their shale gas analysis , evaluating the total gas in place within the Haynesville Formation (Shale) in the mineral leases held by the AEXP in Mississippi. The assessment demonstrates estimated gas in place of at least 300Billion cubic feet/section (a section is 640 acres). This places more than 2 Tcf of estimated gas on the property.  That is 2 TRILLION cubic feet of gas on AEXP’s property. Read the full release here.

It goes without saying (but, I’ll say it anyway) THIS IS HUGE!

The infrastructure is already in place.

A Gas Facility is located only 5-6 miles away and pipeline permits exist to transfer 60-70 Million cubic feet/day.

AEXP has a plan!

The company is doing everything it can to monetize their property as quickly as possible.  According to the company, they have realized that becoming drillers themselves is too time and capital intensive.  They are currently focusing on evaluating the property, mapping the prospect, doing a sophisticated evaluation of mineralogy and geochemistry, mapping out drilling locations, etc…. Once they are ready for drilling, they will bring in drilling and extraction partners to extract the gas from the shale deposits.

The Chart and Discussion

The chart shows a penny stock stock that is just starting to get known. Volume is picking up and could really spike as the stock becomes known.  The MACD is showing a strong bullish tendency.  The stock is in new territory trading above the 13, 50 and 200-day MA’s.  The Stochastics are indicating that the stock is overbought, but with the new volume that I expect to come into the stock and the bullish MACD, that indicator can stay oversold for quite a while.

Click here for the chart:  AEXP Chart

You are welcome to check AEXP out for yourself by clicking on this link:  AEXP’s website. I would recommend that you do your due diligence.  As you can see from the chart, it has been highly volatile lately. Remember “trend is your friend”.  The trend is positive for AEXP, but make sure to protect your gains.  Tight stops are always recommended.

Be sure to let me know how you do with this one.  I love hearing from my members!