67 WALL STREET, New York - February 6, 2012 - The Wall Street Transcript has just published its Oil & Gas: Exploration & Production Report offering a timely review of the sector to serious investors and industry executives. This 31 page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: International Increase in Capital Expenditures - Rising Costs of Equipment and Services - Shale, Offshore and Deepwater Drilling - Consolidation to Achieve Economies of Scale
Companies include: Anadarko (APC); BP (BP); Baker (BHI); Cameron (CAM); Cenovus Energy Inc. (CVE); Chevron (CVX); and many more.
In the following brief excerpt from the Oil & Gas: Exploration & Production Report, expert analysts discuss the outlook for the sector and for investors.
Scott M. Boruff, President and Chief Executive Officer of Miller Energy Resources, is a seasoned executive with a diverse business background that includes entrepreneurial ventures, development projects and deal-making experience. Over the past two years, Mr. Boruff has been a licensed Investment Banker and Director with a New York investment banking firm responsible for closing transactions totaling $150 million to $200 million. He holds a B.S. in business administration from East Tennessee State University.
TWST: Please begin with a brief introduction to Miller Energy Resources, including a few key highlights from its history and an overview of its two primary projects.
Mr. Boruff: Miller Energy (MILL) is headquartered in Knoxville, Tenn., and is about a 45-year-old company. We've been public about 14 years. I became CEO in August of 2008, and we were a pink sheet company - we went through some savvy acquisitions and some management add-ons, and we were able to go from the pink sheets to the New York Stock Exchange in less than three years. It's been a fun ride. We've done about four acquisitions. We sold some assets right when I came on board in Tennessee, and kind of recapitalized the company with those assets. We sold 30,000 acres for $20 million.
And then, six months later, we bought two companies in Tennessee, and we bought back about 35,000 acres for less than $1 million. Then you roll forward a year later, and in every company there is always a turning point that makes you who you are. From our investment banking background and experience in the past, we looked at several deals every month, but we acquired the bankrupt assets of Pacific Energy Resources in 2009, where we basically sat in the bankruptcy court for about four months trying to figure out how to make this deal work.
Because there is always something wrong with a deal and your job as a CEO is to figure out what's wrong, because these assets went bankrupt twice before so you want to avoid making the same mistakes, we were able to identify some undesirable assets and get the bankruptcy court to consent to a sale of the business without those undesirable assets. And that has made all the difference for us.We've grown production from eight barrels a day when I took over to - we've been as high as 1,500 barrels a day in production. This year, we're hoping to grow again from - we're giving guidance on January through January ending out the year at 5,000 barrels a day, so we plan to grow another 400%, 500% again. So it's an exciting story.
TWST: For the most recent quarter reported, ending October 31, revenues at Miller Energy Resources were up 63%, which you attributed to the success of the new wells the company reworked in Alaska. Please tell us more about what's going on there. How much of the increase was prices and how much was increased sales and how much more value do you expect those wells to deliver?
Mr. Boruff: The life blood of every oil and gas company are the reserves, and reserves are just basically oil and gas in the ground, and it takes capital to get them out and to produce them. When I came on board, we had about 15,000 lease acres in 2008. We've grown our lease acreage to around 700,000 lease acres. We've grown revenues from 2008 at around $800,000, and our year end is April 30, so we should finish somewhere around $35 million to $40 million in revenues, planning to grow to next year to over $100 million in revenues. So we went from $800,000 early on in 2008 to around $40 million this year, and planning to grow to $100 million in the next 12 months. We've grown our well count from 53 wells in Tennessee and Alaska to over 393 wells. But the main thing is our assets have grown because of the acquisition that we made in Alaska.
The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 31 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
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