Lots of questions rolling in from the Gumshoe faithful about this ad today — it’s a teaser from Matt Badiali and his S&A Resource Report, and it’s all about the massive oil shale resources in China, and how to profit from them.
Here’s how the pitch begins:
“World’s Largest Oil Shale Field Discovered… in China?
“Just when you thought the China story couldn’t get any bigger… the Chinese make a massive discovery.
“Inside this report: Early investors made a fortune in Bakken Shale (3,685%), Barnett Shale (1,213%) and the Canadian tar sands (5,700%). But that’s nothing compared to what’s likely coming…”
So I can see why so many questions are pouring in here at Gumshoe Headquarters — which is, thanks for asking, in a complete tizzy over our planned move, so please forgive if the Gumshoe is slow to respond to questions over the next couple months.
That sounds like an enticing promise, indeed — a chance for folks who missed the big stock booms from the Bakken Shale to get in on something even bigger.
Badiali (well, his copywriter, at least) draws a compelling picture of China’s energy demand, to get us started:
“I’m sure I don’t have to tell you that China is ravenous for energy…
“According to the International Energy Agency, they will become the world’s largest consumer of energy by the end of this year.
“What you might not know is just how desperate they are…
“‘For the Chinese leadership,’ reports MSNBC, ‘survival depends on maintaining momentum, which is why Chinese companies have struck out in all directions to secure oil deals.’
“Adds Dr. ZhongXiang Zhang of the East-West Institute in Hawaii: ‘[It’s] a national security issue.’
“No wonder, in just one month alone, China spent $41 billion securing oil supplies from all over the world….”
And he goes on to explain the huge demand drivers — the rapid increase in auto sales, the continuing huge demand for energy from Chinese factories. Which leads us to the discussion of the potential supply in China’s shale fields:
“To date, China’s ‘proven’ shale reserves — the oil they already know for a fact is in the ground — amounts to 32 billion tons. Or as much as 23 billion barrels.
“But that’s not counting the potential reserves still sitting underground.
“According to JL Qian of China’s University of Petroleum, the potential shale reserves could be as high as 600 billion tons. Or as much as 428 billion barrels.
“To put that in perspective, that’s more than all the proven reserves in Iraq and Saudi Arabia, combined.
“And that’s just the oil. China’s shale gas reserve could singlehandedly supply the country for over three centuries.
“If oil firms working the Piceance Basin made 500%-1,200% for their investors…
“How much do you think you could make from this massive find?Are you getting our free Daily Update
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“In my mind, there’s simply no precedent — and virtually no limit — to the amount of money that could be made.”
Then he goes on to describe the latest agreement between the US and China, over clean energy, greenhouse gases, and, more importantly for our current purposes, the development of shale oil … this was called the U.S.-China Shale Gas Resource Initiative, all about partnering to develop extraction technologies and promote investment in Chinese shale projects (you can see the gummint press release here).
Are you salivating yet? That’s the idea, after all, that you’ll be so excited about the potential at this point that you’ll have set aside all your worries, qualms and concerns … and now, we start to hear about the actual company that Badiali is teasing — the way you can invest and get rich from the potential of China’s shale:
“This Stock Could Simply Explode
“You have to understand, the shale industry in China is in its infancy…
“And while geologists all agree that the potential is massive, this trend is only just beginning.
“In America, the first companies in — and the first ones to make investors rich — were the exploration companies with the technology to assess what exactly was underground.
“This is known as a ‘seismic’ image in the oil and gas world, which is a fancy way of saying ‘big underground map.’
“Just look at a company like CGG Veritas (CGV), one of the most prolific seismic companies in the world today, with projects all over the globe — including the Bakken formation and the Haynesville, a shale deposit in northeast Texas.
“During the manic years of America’s shale boom (a period we’re poised to see in China) CGV soared from less than $3 a share to more than $60 — a 2,000% gain.”
OK, so that’s the comparison to get us excited — in the last boom, CCG Veritas got rich … who will get rich in this boom? Finally, some actual clues …
“No western company is going to get close to China’s shale reserve without first partnering with a Chinese oil firm — which, as I’m sure you know, is basically like partnering with the Chinese government itself.
“This is how China maintains ‘control’ over its resources.
“As you can imagine, that shrinks the list of potential players down dramatically… which makes picking the winners that much easier.
“Which brings me to our first