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Supergiants like Exxon are focused on big offshore venues like Guyana and Namibia, leaving behind prime onshore natural gas assets in Europe - a region that is now desperate for affordable domestic resources that aren’t controlled by Russian Gazprom. 

Prior to Russia’s invasion of Ukraine, Gazprom was calling the energy shots in Germany. 

Those days are over. 

But Germany, the European Union’s biggest economy, still needs natural gas, even if this winter’s storage is nearly full. It’s not full as a result of domestic sources. Germany has traded one form of dependence for another. The filling up of winter storage has come at a high price tag thanks to expensive LNG imports, which are now at risk, as well, due to the Biden administration’s pause on new LNG export projects. At the height of the crisis, the European Union was paying some 40% more for U.S. LNG imports than it was for Russian piped gas. 

While Germany is busy building grandiose, high-dollar LNG receiving terminals, there is a far cheaper domestic alternative, and it’s found in assets abandoned by the supergiants who are off chasing bigger oil and gas dreams offshore. 

What’s too small for Exxon and others, could be of huge potential value to smaller industry players. 

That’s what MCF Energy (TSXV:MCF; OTC:MCFNF) is focusing on. We believe this is the first new public company providing investors with exposure to European natural gas since Russia invaded Ukraine. 

The big names behind MCF Energy have a clear track record in developing energy assets for top-dollar exits, and they see the timing as the most propitious yet. 

The Top People in the Industry for Europe’s Energy Reset

The company is no stranger to Europe’s energy industry. 

It was co-founded by oil and gas investor Ford Nicholson who has a track record of developing billion-dollar international assets and offloading them for top dollar to giants such as Exxon. In total, Ford has exited around $4.5 billion in energy assets in Europe and Asia.

In the 1990s, after the fall of the Soviet Union, Nicholson launched an energy company in Kazakhstan that was sold in 2006 for approximately $1.6 billion. In 2004, he co-founded a company that developed Europe’s largest heavy oilfield, in Albania (Bankers Petroleum Albania, Ltd) worth about $2.25 billion by 2011.

The story here is one that MCF Energy could be aiming to repeat in today’s Europe, which is in the middle of an energy reset worth trillions of dollars--and the biggest near-term prize is natural gas. 

With its world-class team, Bankers Petroleum saw production grow by over 2,000% between inception in 2004 and 2015. Only 13 months after launch, its enterprise value increased by over 1,000% before being acquired by Geo-Jade Petroleum in 2016. But the story didn’t end there. BNK Petroleum was spun out of Bankers Petroleum in 2008 to explore for shale gas in Europe and developing gas assets in the United States. Between 2009 and 2011, BNK saw a market valuation increase of over 4,000% and became one of the largest holders of oil and gas rights in Europe. 

In 2017, as Deputy Chairman, Nicholson sold another oil and gas company, InterOil, to Exxon for approximately $2.6 billion. 

Now he’s back with MCF Energy (TSXV:MCF; OTC:MCFNF), which has rapidly acquired a portfolio of attractive natural gas projects in Germany and Austria. They have just started drilling in one of their most prospective areas.

Ford is backed by an impressive executive team and board, which includes former NATO Supreme Allied Commander of Europe, General Wesley Clark, who is committed to helping ensure Europe’s energy security and independence from Russian oil and gas.

MCF’s CEO is James Hill, the geologist behind BNK Petroleum which delivered major wins for early investors. The executive chairman is Jay Park, a renowned international energy lawyer based in London and Istanbul. Park is also the former Chairman of Reconnaissance Energy

Africa, which is exploring one of the biggest emerging oil plays in the world, in the African frontier of Namibia. 

Finally, director Richard Wadsworth, also a former Bankers Petroleum figure, is a 30-year petroleum engineer veteran who most recently led and developed a 55,000 bopd oilfield in Iraq that has a development plan for 230,000 bopd. 

Key Assets Where Europe Needs It Most

The first drill, that will launch next week, is in Austria, at MCF Energy’s Welchau prospect near the Austrian Alps. This prospect is analogous to large anticline structures discovered in the Kurdistan Region of Iraq and the Italian Apennines. 

Welchau is adjacent to an up-dip from a discovery that intersected at a gas column of at least 400 meters, testing condensate rich for pipeline quality gas. A national gas pipeline network is only 18 kilometers away, making for a short, cheap tie-in option for getting product to domestic markets. 

MCF will earn a 25% interest for exploration drill costs estimated and capped at 2.55 million euros. 

In Germany, MCF Energy (TSXV:MCF; OTC:MCFNF) has licenses secured for six large-scale project areas in the country’s northern and southern regions, with the Company stating that drill testing set to launch immediately after the Austrian drill is aimed to be completed.

These key projects are the result of MCF Energy’s strategic 100% acquisition of Germany’s Genexco GmbH. Genexco was established in 2014 by some of Europe's largest energy producer insiders. It carefully assembled a portfolio of exploration and developments assets when few others were paying attention.

The Genexco acquisition gave MCF Energy four key assets that include previously drilled wells and two discoveries. MCF got its hands on Reudnitz, a proven, large-scale natural gas development that also contains an oil exploration target. They also acquired the Lech  concession, a 10-square-kilometer play with three previously drilled wells and two discoveries; Lech East, which directly offsets the discoverys on the Lech block is much larger,  around 100 square kilometers; and the Erlenwiese concession in the Rhein Graben which covers about 80 square kilometers.

Reudnitz, some 70 km southeast of Berlin, was initially discovered in 1964 with multi-zone hydrocarbon potential and proven phases of Helium (~0.2%), methane (14-20%) and like most fields in norther Germany high nitrogen content (>80%). 

According to the company, pilot test production will start this year.  After testing development is planned using cryogenic technology for helium and nitrogen sequestration. The Company announced an independent assessment best estimate (P50) at 118.7 billion cubic feet (BCF) of methane, 1.06 BCF of helium and 4.4 million barrels of oil. 

But the next drill, right after Austria, currently scheduled in March, will be MCF Energy’s Bavarian concession, Lech , where they will re-enter the Kinsau #1 well. Back in 1983, this same well tested at a maximum flow rate of 24 MMCFD. MCF’s 20% interest in this concession (through its Genexco acquisition) means it won’t be paying for the cost of drilling, which the Company estimates to be up to 5 million euros. 

Cheniere's commitment to sustainability is reflected in its efforts to improve the environmental performance of its operations and its product's role in enabling transition to a lower-carbon future. The company's focus on safety, environmental stewardship, and community engagement underscores its role as a responsible energy provider.

Cheniere Energy offers a unique opportunity to engage with a leader in the LNG market, with a proven track record and a strategic position to benefit from the global shift towards cleaner energy sources. The company's pioneering status, combined with its ongoing expansion and operational excellence, positions it well for future growth and profitability in the energy transition era.

Spain's Repsol (OTC:REPYY) is no stranger to Europe's energy fluctuations. Their robust efforts in the natural gas domain, especially in the Iberian Peninsula, make them a major force in Europe's push towards cleaner fuels. With assets in major gas fields and a network of distribution facilities, they're poised to cater to rising demands.

Oil remains integral to Repsol's identity. With both offshore and onshore operations, their commitment to sustainable and efficient oil production is apparent. Their refining capabilities are among Europe's best, ensuring the production of high-quality petroleum products.

Repsol offers a balanced mix. Their endeavors in the natural gas sector showcase growth potential, while the longstanding oil operations highlight reliability and expertise.

Birchcliff Energy Ltd. (TSX:BIR) is a key player in the Canadian oil and natural gas sector, with a primary focus on high-quality assets in the Montney/Doig Resource Play. This strategic emphasis allows Birchcliff to harness the potential of one of North America's premier resource plays, contributing significantly to its production and reserve growth. The company's dedication to operational excellence and cost efficiency has positioned it as a low-cost producer, optimizing returns even in fluctuating market conditions.

Birchcliff's commitment to sustainability and responsible development is a cornerstone of its operations. The company actively implements practices aimed at reducing its environmental footprint, ensuring the safety of its operations, and fostering positive relationships within the communities it operates. For investors, Birchcliff represents a blend of growth potential and commitment to corporate responsibility, underpinned by its strategic asset base and operational strategy.

Looking ahead, Birchcliff Energy is focused on sustainable growth, leveraging its strong asset base and operational efficiencies to navigate the evolving energy landscape. With an eye towards enhancing shareholder value, the company is well-positioned to capitalize on opportunities within the Montney/Doig Resource Play, making it an attractive proposition for those invested in the Canadian energy sector.

Enerplus Corporation (TSX:ERF) operates as a diversified North American energy producer, with a portfolio that spans both Canada and the United States. The company's strategy focuses on organic production growth within its core areas, emphasizing operational efficiency and cost management. Enerplus is known for its high-quality light oil assets, particularly in the Bakken/Three Forks formations in North Dakota, which drive a significant portion of its production and revenue.

Enerplus's approach to business is marked by a commitment to sustainability and responsible resource development. The company invests in technologies and practices that minimize environmental impact and enhance the safety and efficiency of its operations. For investors, Enerplus offers a balance of growth and sustainability, supported by its strong asset portfolio and strategic focus on key resource plays.

As Enerplus looks to the future, the company aims to continue its trajectory of disciplined growth and operational excellence. With a robust balance sheet and a strategic emphasis on its core areas, Enerplus is poised to adapt and thrive in the dynamic energy market. The company's focus on value-driven growth and sustainability positions it as a compelling investment opportunity within the energy sector.

Vermilion Energy Inc. (TSX:VET) is recognized for its international portfolio of assets across North America, Europe, and Australia. The company's diversified approach allows it to tap into various markets, optimizing its production mix to leverage global pricing dynamics. Vermilion is committed to delivering strong operational and financial performance, underscored by its strategic acquisitions and efficient resource management.

The company places a high emphasis on environmental stewardship, community engagement, and safety. Vermilion's operations are guided by a commitment to minimizing its environmental impact and investing in the communities where it operates. This approach not only supports sustainable development but also enhances Vermilion's corporate reputation and stakeholder relationships.

Vermilion Energy aims to sustain its production and cash flow through disciplined capital investment and efficient operations. The company's diversified asset base provides a platform for resilience and growth, making Vermilion an attractive option for investors seeking exposure to the global energy sector with a focus on sustainability and community partnership.

MEG Energy Corp. (TSX:MEG) specializes in sustainable in situ oil sands development and production in Alberta, Canada. MEG Energy is focused on enhancing the efficiency and environmental performance of its operations through technological innovations, such as its proprietary HI-Q® technology, which aims to reduce costs and improve resource recovery rates. The company's commitment to responsible development is evident in its efforts to reduce greenhouse gas emissions and water use.

MEG Energy's strategy is centered on maximizing the value of its substantial oil sands assets while maintaining financial discipline and operational excellence. The company's robust production base, combined with its focus on cost reduction and operational improvements, positions MEG to generate significant free cash flow.

As MEG Energy looks towards the future, the company is well-positioned to continue its path of operational excellence and financial strength. With a clear focus on sustainable development and technology-driven efficiencies, MEG Energy presents a compelling investment opportunity for those looking to participate in the Canadian oil sands sector with a company that prioritizes environmental and economic sustainability.

Whitecap Resources Inc. (TSX:WCP) is an oil-weighted growth company that acquires and develops conventional oil and natural gas resources in the Western Canadian Sedimentary Basin. Whitecap's strategy revolves around creating sustainable shareholder returns by combining a disciplined acquisition strategy with low-decline assets and a strong emphasis on operational efficiencies and cost control.

The company is dedicated to responsible energy development, with initiatives aimed at reducing its carbon footprint and enhancing overall sustainability. Whitecap's commitment to environmental stewardship is complemented by its efforts to maintain strong governance practices and positive community relations.

By. Michael Kern