[update: Yeah, as of late September we’re taking back this admission of a mistake — we were right all along, the Casey folks just threw us off with a red herring, as is clear in the subsequent ads that they are now using to pitch this same idea, now looking at mid-October as the time when results will come in after the initial drilling hit some trouble and delays. I still don’t own the stock as of September 26 and haven’t traded it, and won’t until at least October]

I originally wrote an article about this Casey Energy Report tease following the first wave of teasers from the Casey folks, on August 20 — since then, they added some more detail to the teaser pitch that made my solution not fit, so we’ll take a mea culpa and accept this as our mistake for 2013. I’m willing to release one incorrect teaser solution each year before I begin the process of self-flagellation, so we keep our 99%+ accuracy rate but, as always, we are not infallible.

So what’s the story? The Casey folks had a pitch for their Casey Energy Report about the “Next Bakken” — a very early stage exploration company with a large land position and expected drilling results in mid-September. These are the clues they gave initially in their first teasers:

“Over the last year this little company has quietly assembled a 2-million-acre concession in a region whose geological conditions for the production of oil and gas are actually far more promising than those in the Bakken….

“In July, one director of the company, who is also the CEO of a major Canadian oil player, bought 200,000 shares at the market – bringing his holdings of the company’s stock to a total of 1,235,237 shares.”

Which pointed the Mighty, Mighty Thinkolator directly at PRD Energy (PRD.V, PREGF) — they’re working on rejuvenating oil production on about two million acres, using unconventional technologies (horizontal drilling, etc. — I guess we have to start calling those “conventional” now). And more importantly, we had an exact match on those shareholders, here’s what I wrote three weeks ago:

And yes, they are expecting to have short-term results from their first well, which they call Boerger 7A, in mid-September — so the September 16 projected catalyst fit as well. That well is a farm-in they’re earning on a GDF Suez property, and they hope to use this drilling to acquire more data about these kinds of reservoirs as well as earning in their 50% share of the project by spending the money required to drill and get seismic data.

So … sounds like a perfect match, right? Marin Katusa, a Casey analyst, has even recommended them in the past, and he has written in the last six months that he’s looking at “next Bakken” opportunities in the heart of Europe, which would also connect us to PRD. I was convinced.

But then some versions of the ad changed up a bit. The original version is still the same, you can see it here — the same ad they pitched started on August 20, as far as I can tell. Still a perfect match for PRD Energy.

(Back in April, Katusa said: “we believe that we have a company in our portfolio that is just as good: a junior exploration company that is sitting in the heart of Europe. By applying new technology to old fields and old wells, it may very well be sitting on the next Bakken.”)

But dammit if they didn’t throw in another clue in a separate letter that was sent out several days later — that second letter took away the reference to the insider buying but kept the two million acres, and added a clue that conflicted with my first answer. You can see the second version of the teaser pitch here, it’s not up on Casey’s site but someone else published the email. Here’s the offending paragraph:

“Until the company has completed its flow tests and made a public announcement, other than saying it’s in the Southern Hemisphere, we can’t share any details about the company – or even the country where the ‘next Bakken’ is located.”

And, um, no — Germany (where PRD’s fields are) is not in the Southern Hemisphere.

So, resisting the urge to be petulant forever, we went searching for another match.

There are plenty of places around the world who have big potential shale oil deposits, there’s been precious little shale exploration (and even less exploitation) anywhere outside of North America — so if we assume that these two ads are touting the same little stock, what’s another candidate?

A refresh of the clues?

• An insider, who is a CEO of a different Canadian energy company, owns 1,235,237 shares after buying 200,000 in July.
• They have a concession of roughly two million acres, acquired over the last year or so, in a “region whose geological conditions for the production of oil and gas are actually far more promising than those in the Bakken”
• They are expected to have flow test results from a well sometime in mid-September, on or near the teased September 16 date.
• And for the second version of this tease, they now say the drilling is in the Southern Hemisphere in a “resource rich” country (and they don’t mention that insider buying bit in the second version).

Need to hear some of the rest of the tease, just to refresh your memory? Here’s a bit:

“Just a few days ago, a hastily assembled team including Chief Energy Investment Strategist Marin Katusa and Casey Research Managing Director David Galland were preparing to fly to a secret location. A location where a small oil company is about to drill the first oil well into what appears to be a massive new oil bonanza.

“But at the last minute, the oil company’s lawyers canceled the trip and imposed a total communication blackout. They did so out of concern that regulators would think having the Casey Research team on site gave our subscribers an unfair advantage…

“… our energy analysts believe the company may have as much or even more potential than those companies that made billions in the now legendary Bakken formation….

“Be Ready: We Expect the Initial Drilling Results on or Around Monday, September 16”

Now, the very nature of small exploratory stocks like whatever this one turns out to be, and like Africa Oil before they hit oil in their first hole, means that you have to accept a pretty high likelihood of failure and stock volatility. That’s likely why they’re waiting on results before they send this special report to their subscribers, or at least that’s my impression from the ad — though they also say that members of the Casey Research team are invested in this stock through an investment fund, so it seems someone believes it’s worth a flyer before they make that expected announcement next month. Who knows, maybe they’ve already mentioned it to their subscribers and they’re just holding off on a glowing recommendation until the drilling results come in.

So there you have it. What’s the stock?

Well, there isn’t one. Not in the Southern Hemisphere, and not that can be found by even a fully refreshed and awake Thinkolator — you can’t match all of those clues and the Southern Hemisphere together and come up with anything particularly interesting.

So … I still suspect that they’re following PRD Energy (PRD in Canada on the venture exchange, PREGF on the pink sheets)… but I can’t say I’m sure anymore, not with that Southern Hemisphere red herring in there. Think of this as a decision in a civil trial, not a criminal one: I’m going with the “preponderance of the evidence” decision here, not the “beyond a reasonable doubt.”

It could be someone else, to be sure — Tag Oil (TAO in Canada, TAOIF on the pink sheets) in New Zealand comes close on some fronts, but they don’t have any CEOs of Canadian companies on their board, nor have they had any insider buys to speak of this Summer (and no one owns that exact number of shares). The other oft-cited possibility is New Zealand Energy (NZ.V in Canada, NZERF on the pink sheets) — but they don’t have any CEOs of large Canadian companies on the board, either, nor have they had that specific insider buying behavior (they do have over two million acres, and they are expecting some flow tests to give them more data about their potential in the unconventional basins on the east side of the North Island — the same area where Tag is also looking for future growth. Tag has had concerns about declining production of late, and New Zealand Energy is trying to make a pretty big acquisition so they need to raise some money, but I haven’t monitored them all that closely otherwise.

PRD Energy shares have gone up by about 50% since the Casey teaser campaign started on August 20, probably in part because our coverage amplified the impact of their teaser ad on the stock (we didn’t charge $800 to tell you the solution to the clues, so we probably had a few more readers). PRD is a company that’s exploring for oil and gas in Germany on just under two million acres, largely in areas with known past-producing or past-explored oil fields that haven’t yet seen horizontal drilling or other new extraction technologies (they say they don’t require fracking to be profitable, which may be important), and it has a market cap of now about $90 million.

The director who recently upped his stake to 1,235,237 shares is Grant Fagerheim, who is also CEO of Whitecap Resources, a much larger ($1+ billion) Canadian producer that’s profitable and pays a dividend. They also have some folks on the board and in their technical team who have Bakken and Alberta experience, and they specifically compare the opportunity to the Bakken in their promotional materials (the New Zealand guys do that, too, as does anyone with any kind of shale prospect around the world).

And yes, they are expecting to have short-term results from their first well, which they call Boerger 7A, in mid-September — that’s a farm-in they’re earning on a GDF Suez property, and they hope to use this drilling to acquire more data about these kinds of reservoirs as well as earning in their 50% share of the project by spending the money required to drill and get seismic data. Here’s the pertinent bit of their latest operational update about this potential catalyst:

“Mobilization of the drilling rig is well underway and PRD expects to begin drilling on August 2 or 3, 2013. Drilling will start from a depth of 680 meters and continue to a total vertical depth of approximately 1,800 meters with a 300 meter horizontal leg. Drilling is expected to be completed in August. Depending on drilling results, the Company expects to announce short-term production test results in mid-to-late September.”

That news has not yet come out. Don’t know if it will really hit on September 16 or not — and, of course, it might not be good news.

Their investor presentation is pretty compelling in making the case for the opportunity in these old German oil fields, many of which haven’t produced for 20 years, but, of course, it’s an investor presentation — its job is to be compelling. And as is teased in the pitch, they have indeed built up this portfolio of concessions relatively quickly and quietly, the vast majority of their acreage was added over the past year.

I’m not buying or selling this one (or either of the New Zealand companies), and of course I’m not telling you to buy or not to buy it, but it’s still the best match for the stock the Casey folks say they’re going to analyze for Casey Energy Report subscribers following the drilling results next month, and the version of the ad they’re sending out these days again fails to mention the Southern Hemisphere clue that threw us all into a tizzy on August 26.

I can’t explain why that teaser pitch about the Southern Hemisphere got added on to make the clear and specific match no longer a match, but coincidences are certainly possible — maybe there is another company that matches all of those disparate clues from the two different teaser pitches … or maybe the ad that mentioned the Southern Hemisphere was a mistake or an intentional red herring (remember, the ad with the Southern Hemisphere did not mention the insider ownership specifics).

So I’ll toss it out to you — If any of the other Gumshoes out there can find a match for us of a company that is sitting on roughly two million acres of oil exploration concessions with some drilling or flow test results expected in the next couple weeks, that has a board member who is also CEO of a Canadian energy company, who bought 200,000 shares in July and now owns 1,235,237 shares, and is drilling for oil somewhere in the Southern Hemisphere, I’ll upgrade you to a lifetime membership in the Stock Gumshoe Irregulars for free (just in time! I’ll be reporting for the Irregulars from the Value Investing Congress next week). If you’re already a lifer, I’ll find something else to give you.

I’ve kept all of the comments from our original August 20 article below, including some speculation about those New Zealanders and some other commentary — feel free to add your notes to the pile.