QUOTE AND NEWS
OilVoice  Feb 25  Comment 
Houston American Energy Corp. NYSE Mkt HUSA today announced that it has agreed to purchase ordinary shares of Tamboran Resources Limited for 1 million. Closing of the purchase is subject to receip
OilVoice  Apr 24  Comment 
Houston American Energy Corp. NYSE MKT HUSA today announced that a final settlement has been agreed upon in the civil ceaseanddesist proceeding previously instituted by the Securities and Exchang
OilVoice  Jul 18  Comment 
Houston American Energy Corp. NYSE MKT HUSA announce that the United States Court of Appeals for the Fifth Circuit has reversed the District Court39s prior dismissal of the previously disclosed
OilVoice  Jan 13  Comment 
Houston American Energy Corp. NYSE MKT HUSA provided an update on its drilling operations in Iberville Parish Louisiana and announced that it had acquired an interest in an additional prospect.
OilVoice  Oct 3  Comment 
Houston American Energy Corp. NYSE MKT HUSA provided an update with respect to its near term drilling plans. In addition to previously announced plans to participate in drilling a 1000039 test
StreetInsider.com  Dec 10  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/Houston+American+%28HUSA%29+Notified+of+Intention+to+Plug%2C+Abandon+Zorro+Gris+%231/7936708.html for the full story.
StreetInsider.com  Sep 27  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/Houston+American+%28HUSA%29+Continues+Drilling+at+Zorro+Gris+%231%3B+Updates+on+Progress/7754121.html for the full story.
OilVoice  Sep 24  Comment 
Houston American Energy Corp. NYSE MKT HUSA today announced that it has concluded its review of strategic alternatives undertaken with the assistance of its advisor Canaccord Genuity Inc. The co
StreetInsider.com  Sep 4  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/Houston+American+%28HUSA%29+Starts+Drilling+at+Third+CPO+4+Block+Well/7699234.html for the full story.
Benzinga  Jul 27  Comment 
Houston American Energy Corp. (NYSE: HUSA) today announced that it has engaged Canaccord Genuity Inc. to act as its advisor in connection with its exploration of strategic alternatives for the Company. As previously announced, the Company intends...




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Houston American Energy (HUSA) is an oil and gas exploration and production company that operates inland in the US Gulf Coast region of Texas and Louisiana and in Colombia, South America. The company's wells in the US produce primarily natural gas while its interests in Colombia account for all of the company's oil production and nearly all of the company's total revenue. The company operates eight oil wells in Colombia and seven gas wells in the US. The company's oil operations in Colombia dwarf their US gas operations, accounting for 99.5% of total revenues.[1]

Business Segments[2]

  • Oil - 99.5% of net sales (0.5% growth)
  • Gas - 0.5% of net sales (0.5% decrease)

Houston American Energy's sales more than doubled in 2010 as a result of twelve new oil wells in Colombia that came on-line during the year and higher oil prices, which prevented any work stoppages like as the 52-day stoppage that occurred in 2009 as a result of low oil prices.[3] Oil prices in 2009 dropped so low that it was not profitable for the company to operate its wells, causing the work stoppage.

Trends and Forces

Political Stability and Outside Forces in Colombia

The largest factor affecting the future prospects of Houston American Energy is the stability of Colombia. Although the country is now at peace following a long and bloodstained civil war, it has less than enjoyed less than ten years of relative stability. The current president, Juan Manuel Santos, has courted foreign investment and the country's economy is rapidly growing as a result of its oil resources.[4] However, HUSA is a small company competing against much bigger players in oil production and operates at the mercy of Colombia's regulatory bodies and government policies. Colombia's continued stability and growing prosperity will be vital to the future success of Houston American Energy.

Colombian Partners and Minority Interests

Unlike some of its competitors, Houston American Energy owns relatively small shares of the oil fields in which it operates. The company owns interests in certain fields in Colombia, however most of the actual mining operations are carried out by the company's main in-country partner, Hupecol. As such, the company is susceptible to shut-downs implemented by Hupecol, such as the 52-day stoppage that occurred in 2009 when oil prices fell too low.[5] As minority owners not involved in the actual pumping of oil, HUSA's fortunes heavily depend on its Colombian partners. In addition, the majority of the company's value is based on its potential reserves, many of which remain unproven.[6]

Competition

  • Gran Tierra Energy Inc (TSE:GTE) is another oil exploration and production firm that operates in Colombia.[7]
  • SK Energy is South Korea's largest energy company that owns large blocks of land rights for oil exploration in Colombia.

The company peripherally competes against many of the larger oil exploration and production companies, however the two highlighted above have significant interests in Colombia.

References

  1. HUSA 2010 10-K, p. 34
  2. HUSA 2010 10-K, p. 34
  3. HUSA 2010 10-K, p. 29
  4. Columbia Will Power Next Generation of Oil Production, Nasdaq, 2/6/11
  5. HUSA 2010 10-K, p. 29
  6. Houston American Energy Corp Set Up For Collapse, SeekingAlpha, 4/7/10
  7. Investing in Colombian Oil? Choose Gran Tierra Over Houston American, SeekingAlpha, 6/30/10
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