BGX Strikes Black Gold, Primed for Massive Breakout Amidst Trump Tariff Chaos

It’s practically a cliche by now, but I’m going to say it anyway: In every crisis, there’s an opportunity.

There, I said it.

So, does that mean there’s an opportunity at this very moment?

You betcha! And it’s a nice one too!

Now, in the interests of not burying the lede, I’ll throw the opportunity out there right now. It’s Black Gold Exploration Corp. (BGX) [CSE: BGX | FSE: P30], an oil and gas junior with substantial, now-proven holdings in the tremendously productive Illinois Basin. (FYI: The basin has produced over 4 billion barrels of oil to date, and there’s an estimated 4.1 billion barrels of recoverable oil remaining.)

But, before I get too deep into discussing why BGX is so hot right now, let’s get a couple of preliminaries out of the way.

First, in case you’ve been living under a rock, here’s a very quick tl;dr of the crisis I’m talking about:

• Massive on-again, off-again Trump tariffs and global retaliation are wreaking havoc on the markets. The result — massive volatility.
• “America First” protectionism and reshoring policies have slammed the brakes on global trade. (Fun fact: Chinese Christmas tree manufacturers are reporting no US orders, despite this being peak season for orders.)
• Trump’s “Drill, Baby, Drill” agenda should be fueling U.S. oil/gas expansion, but depressed oil prices and regulatory uncertainty have big producers thinking twice. (To quote Dustin Meyers, Senior VP at the American Petroleum Institute (API), “Many of these areas have been closed for a good long while. There is always the risk that these areas could be reclosed after the next election cycle.”)
• General uncertainty is everywhere. Inflation fears + trade disruption + an unpredictable Trump presidency = investor confusion and market volatility.

As for the second preliminary item that I want to get out of the way, that would be a checklist — a checklist of things to look out for if we’re going to spot an opportunity in this crisis. So this doesn’t get too long, I’ll keep it to just three points.

1. Crisis Sweet Spot: It should be an oil opportunity since this seems to be where the biggest crisis is right now (general market volatility combined with depressed oil prices).
2. Policy-Aligned, Politics-Proof: It should be positioned to take maximum advantage of the current Trump-era, oil-friendly administration, but it should also be immune from the ‘election cycle’ risks API’s Dustin Meyers alluded to.
3. Cheap but Not Broken + Ready to Rebound: Market sentiment should be pulling its price low, but its fundamentals should otherwise be strong. (You can’t make a dead cat bounce, no matter how hard you throw it.) There should also be a clear, near-term catalyst for a strong rebound.

With all that out of the way, let’s take a look at how BGX fits so perfectly into this crisis/opportunity narrative.

1. BGX Is Seated Right in the Trump Tariff Crisis Sweet Spot

Between a turbulent stock market and tumbling oil prices, there’s something of a double whammy crisis hitting publicly listed oil companies right now. Black Gold Exploration Corp. (BGX) [CSE: BGX | FSE: P30], in particular, has felt the full force of these effects.

To illustrate just how strong the impact was, we first need to look back two weeks ago. That’s when BGX announced the results of its Fritz Well drill program, which were overwhelmingly positive. Here are a few highlights:

• Multiple Pay Zones Confirmed: The Drill Program confirmed multiple shallow pay zones, all above 1,900 feet depth.
• Accuracy of Seismic Analysis Confirmed: The identified pay zones corresponded with earlier 3D seismic analysis with migratory pathways into multiple zones with high porosity, confirming the accuracy of the analysis.
• Strong Potential for Greatest Pay Zones at Deeper Depths:  The analysis also identified a deeper motherload with significant reserves beyond 2000 feet.
• Offset Well Potential: Results suggest strong potential for several offset wells, which could really fuel exponential growth by creating a flywheel effect as initial revenues are used to develop new wells.
• 30-60 Days to Production: The Well could be completed and producing within 30–60 days, with BGX now working with LGX to complete the well and commence extraction.

In short, what we have is massively positive news. Particularly that last item. 30-60 days to production is a huge breakthrough for a junior.

Let me repeat that for emphasis: 30-60 days to production is a huge breakthrough for a junior. It’s the sort of news that would normally drive enormous investor interest. After all, this is exactly the sort of news that transforms the company from a high-risk “exploration” company into a proven “producing” company generating cash flows.

Instead, all we got was a little sideways action, followed by a bit of a sell-off following Trump’s “Liberation Day”.

Ouch. That’s gotta hurt if you were a BGX investor. Particularly if you were a long-term believer — incredible news on the drill results finally arrives, only to have negative sentiment crash the party and ruin it.

Anyway, as they say, someone’s loss is someone else’s gain. And boy, oh boy, are there gains to be had here. When this “crisis” clears up — and if history’s any indicator, it will — it will be hard to overstate just how big the upside potential on BGX is.

In fact, I might even go out on a limb here and say the crisis might not be as big as some people are imagining it to be. For instance, remember the Chinese Christmas tree story I highlighted at the beginning?

Notice how the manufacturers are only talking about U.S. orders? Nowhere do we see them worrying about all of their orders. And that’s an important point.

Why?

Because it runs somewhat counter to a popular narrative we’re hearing right now — that the current oil crisis is similar to the COVID-era crash.

Think about it. When oil prices crashed to negative dollars in 2020, it wasn’t because U.S. demand for Chinese goods was down. It was because global demand for just about everything was down.

Now, that’s not to say there aren’t some parallels with the COVID-era crisis. For instance, during COVID, we had the Saudis and Russians waging a price war — something similar could happen now that OPEC+ has unexpectedly accelerated its production cap hikes.

In any case, whether the current crisis is truly as deep as the COVID-era one, or whether it’s simply an overreaction, the important thing to remember here is that it’s only temporary. After all, if the price of oil has already bounced back from negative dollars to over $100 a barrel, it will certainly do so again.

Ditto for the stock market.

2. BGX Is Aligned With Trump-era Policies, Yet Also Politics-Proof

Alright, let’s move on to our next point on the checklist — aligned with Trump-era policies, but also politics-proof. To start with, let’s quickly recap what I mean by policy-aligned and politics-proof.

• Trump-era Policy-aligned: The current Trump administration has made no secret of the fact it’s leaning heavily into U.S. oil and gas. Thus, any opportunity in this crisis should have heavy exposure to U.S. oil and gas.
• Politics-proof: Big Oil has expressed concerns about election cycle risks. Namely, if they fire up new drilling operations in freshly deregulated zones, they’re at the mercy of possible backtracking by future post-Trump administrations. Thus, any opportunity should be centered around well-established production zones with minimal political risk.

On both of these fronts, BGX comes up trumps (excuse the pun).

On the Trump-era policy-aligned side, BGX has heavily invested in U.S.-based projects. Namely, its interest in a group of oil and gas leases in Vigo County, Indiana, including its interest in the Fritz Well and surrounding mutual interest zones.

This has BGX poised to benefit maximally from the current administration. Particularly if an all-out trade war breaks out, in which case the U.S. will require new companies like BGX to supply its energy needs.

As for the politics-proof side, we need only take note of where BGX’s projects are located. That is, smack bang in the middle of the Illinois Basin — an oil and gas-friendly jurisdiction with a long (and highly fruitful) history of production.

In other words, even if the White House finds itself occupied by the disciples of Al Gore come the next election cycle, the Illinois Basin will be one of the last places to go.

3. BGX Is Cheap, and It’s Ready to Rebound

To a certain extent, this final point is somewhat redundant by now. Just to recap, we’ve already seen that:

• BGX has taken a hit to its stock price owing to general fear and uncertainty in both oil and equity markets in the wake of Trump’s tariff war — fear and uncertainty from which both will undoubtedly bounce back.
• BGX is fundamentally sound. (While we haven’t delved too much into it here, here’s a good deep dive covering BGX’s projects, leadership, and potential.)
• BGX is primed for a massive rebound, owing to the overwhelmingly positive news it has been dropping right now.

Now, this last point is something I want to dwell on just a little bit more. After all, this is what’s going to turn any rebound into a true breakout moment. So let’s turn our attention back to BGX’s recent drill results announcement for a moment.

To put a little more context around the results (and the speed at which we should start seeing further developments), let me outline a bit of a timeline here:

• August 2024: BGX makes its first move into the U.S. with the acquisition of a 30% interest in a group of oil, gas, and mineral leases in Clay and Vigo County, Indiana.
• October 2024: BGX doubles down, adding an additional 822 acres to the package it acquired in August.
• January 2025: BGX enters into a purchase and sale agreement with LGX Energy Holdings for a 10% working interest in the Fritz Well in Clay County.
• February 2025: BGX commences drilling at the Fritz Well.
• April 2025: BGX completes its Fritz Well drill program with better-than-expected results. Some highlights that were identified:
  • Multiple shallow pay zones identified above 1900 ft
  • Potential for even larger pay zones at deeper depths
  • Potential for several more offset wells
  • Confirmation that the Well can be completed and brought to production within 30-60 days

All of this is to highlight the pace BGX is moving at here. In the space of 8 months, the company has gone from having zero U.S.-based assets to a point where it’s achieved every oil and gas junior’s dream — to strike viable pay zones that are ready to be brought into production rapidly.

So that now leaves us with the question: Where to from here?

Unfortunately, I don’t have a crystal ball, so I can’t be 100% certain here. But there are a few things we do know at this stage:

• BGX’s drill results aligned with earlier 3D seismic analysis, which revealed multiple high-porosity zones, thus confirming the accuracy of the seismic analysis.
• Swab and flow test results confirming the well’s productivity and reservoir characteristics are due in the coming weeks. Again, if the earlier 3D seismic analysis is any indication, these results should be exceedingly positive.
• The Company is working with LGX Energy — founded by natural resource legend Howard Crosby, whose track record includes taking Cadence Resources from under $1 million to over $400 million — to complete the Well and commence extraction.
• The Company is on the cusp of production, which should act as a re-rating catalyst to drive a value increase in the Company.
• Multiple offset wells also position the aggressive growth for the coming years.

In short, the narrative we have here is one of a fast-paced zero-to-production story that could very well see BGX hit full-scale production in a matter of months. Now couple that with the inevitable rebound of oil and equities markets, several offset wells that could be put into production, and it becomes hard to see how any of this ends in anything other than a serious breakout.

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(Featured image by Jan Zakelj via Pexels)

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