TRCH - Torchlight Energy Resources: Special Dividend Likely To Be Of Limited Value

• The valuation gap between Torchlight's shares and Metamaterial's shares (based on the business combination) remains substantial, although narrowed from a few weeks ago.
• Torchlight's special dividend is likely to have limited value though.
• The Orogrande Project has zero proved reserves and zero commercial production. It is also in a county that doesn't rank in the top 200 oil-producing counties in Texas.
• Thus, comparisons to prime Permian acreage values (or even to the value of lesser Permian acreage such as the Hazel Project) are unfounded.
• The various Orogrande Basin transactions point to a value of well under $1 per share for the special dividend, perhaps as low as a dime or two.

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