Why 3D Oil Share Price Jumped Higher Today

At the time of writing, shares of 3D Oil Ltd [ASX:TDO] are up by 42.86%, to 15 cents per share. 3D Oil owns an exploration permit (WA/527-P), located roughly 80km north-east of the Dorado-1 oil discovery Carnarvon Petroleum Ltd [ASX:CVN] owns 20%, Quadrant Energy 80%.

Why did 3D Oil Ltd shares do this?

The company announced that it found ― at least ― 15 leads across the permit today. It used a combination of open-file 2D seismic data and the Searcher Seismic Multi-client Bilby 2D seismic survey to find them.

The leads are considered prospective for oil.

That’s good news.

The company plans to ‘farm out’ these leads over the coming months and could get a fair bit of cash for them.

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What now for 3D Oil Ltd?

The company elaborated on its latest work:

The discovery of significant oil and gas-condensate at Dorado-1 has materially re-shaped the existing geological interpretation of the Bedout Sub-basin. The discovery illustrates that the Lower Triassic sands can host significant accumulations of hydrocarbons within multiple reservoir intervals.

Recent publications made by Quadrant Energy to leading Australian Oil & Gas Journal APPEA indicate that the Lower Triassic contains excellent quality oil-prone source rocks (Woodard et al. 2018). 3D Oil is conducting a new thermal and migration model which integrates these source rock parameters with the Dorado-1 results.

‘The initial results from the migration model indicates the potential for significant hydrocarbon available to the western side of our adjacent 100%-owned permit WA/527-P, located along the margin of the Bedout Sub-basin.

There’s a lot of jargon in the above comments. However, considering the drilling and evaluation of the Dorado-1 well by Carnarvon Petroleum, the market is excited.

It wants to back the next oil discovery!

Remember, Carnarvon Petroleum’s market capitalisation stands at roughly $500 million today. That’s significantly more than 3D Oil’s $25-million market cap. Like we said yesterday, Carnarvon Petroleum’s discovery could be a massive boost for the struggling oil and gas sector ― especially at the junior end of the market.

This is playing out in real time…

The bottom line: It’s still early days for 3D Oil. But, given the oil price is holding up and there are major discoveries found nearby, there’s significant share price potential on offer. 3D Oil now needs to farm out its ‘leads’ and then drill a massive target. That could take some time. But, this is a story worth following because ― if the oil price jumps higher ― the share price could run into drilling.

Jason Stevenson,
Resources Analyst, Markets & Money

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Jason Stevenson is Markets & Money’s resource analyst. He shares over a decade’s worth of investing and trading experience across resource stocks and commodity futures and options. He originally studied accounting and finance at Curtin University, where he was awarded a first-class honours degree. His professional background stems across high-net-worth, top tier accounting (corporate finance, tax and auditing), and sell-side equities research. Before joining the team at Markets and Money, Jason worked at boutique firms which advised fund managers and high-net-worth clients on where to invest. Whether it’s gold, crude oil, copper or an obscure metal like vanadium, you can rely on an in-depth analysis in Markets and Money. Jason also brings you extensive macro, political and geopolitical analysis from around the world. He leaves no stone unturned when it comes to telling the truth. Jason is also the lead analyst of Gold Stock Trader, a premium service for investors serious about precious metal stocks. Websites and financial e-letters Jason writes for:


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