![]() ![]() Based on the formula mentioned in Metamaterial's circular, Torchlight may issue approximately 403 million shares to exchange for Metamaterial's shares, which would imply around 3.3 Torchlight shares for each Metamaterial share. ![]() Metamaterial may have approximately 122 million fully diluted shares now, while Torchlight may have around 153 million fully diluted shares. The former operator of the Orogrande Project sold its 9.5% working interest in the assets for $2.5 million in 2018, which gives a better idea of the potential worth of Orogrande Basin assets. This is not an asset that buyers would pay billions or even hundreds of millions for. Torchlight's Orogrande Project (Hudspeth County) acreage had no proved reserves at last report, and Hudspeth County had no reported production at last report either. However, that comparison shows a lack of understanding about oil and gas assets and is not that much more valid than using Manhattan land values to value a parcel in rural Nevada just because both areas are part of the United States. These calculations tend to mention the value of prime Permian Basin acreage when discussing Torchlight's Orogrande Basin acreage. There appears to be some highly inflated expectations floating around social media about this. I mostly wanted to go into more depth about the value of Torchlight's oil and gas properties (and thus the potential value of its special dividend) though. Metamaterial's stock is up around 36% since that report, while Torchlight's stock is down around 38% over the same period. Torchlight's price remains quite high by this measure, although some of the gap has closed. I've expressed my opinion about Torchlight's relatively high price compared to Metamaterial's given their relative stakes in the post-combination company. Torchlight Energy Resources ( TRCH) is heading towards its merger with Metamaterial ( MMATF). ![]()
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