Golden Opportunities Fund Reaps Major Gains
Release Date: July 28, 2005
We all dream of huge returns on our investments — for a Saskatchewan company, that dream has become a reality.
Golden Opportunities Fund Inc. has announced that by selling its shares in a local oil and gas exploration company, it has realized a return on its investment of 124 per cent, amounting to a gain of more than $3.7 million.
“We haven’t held the investment for that long so for us to make that kind of profit in two years, we’re ecstatic,” said Grant Kook, Golden Opportunities Fund Inc. CEO and chair.
In March, 2003, Golden Opportunities invested $1 million in Romulus Exploration Inc., an oil and gas exploration development company that focused on southeastern and western Saskatchewan. Golden’s acquisition amounted to more than 2.8 million shares. The investment company acquired another 1.4 million shares after investing a further $571,429 in June, 2004. The average cost per share was 37 cents.
On Wednesday, Golden announced that it has sold its shares in Romulus Exploration for $1.17 per share. The investment fund received more than $5 million in addition to about 612,000 shares of a new oil and gas company called Tiberius Exploration.
“Another company came in and bought Romulus and we agreed to the sale,” said Kook. “What they didn’t buy was some certain assets and those assets were rolled into Tiberius which will go forward as an ongoing entity.”
Golden has a history of investing in companies run by the same group of oil executives. One of Golden Opportunities’ first deals in 1999 was to invest in Empire Energy. When that company was sold in 2002, the management team moved on to build Romulus Exploration. With Romulus being sold, the management team has started Tiberius Exploration.
“Our job is to try to, as best we can, pick the winners and losers in private sector companies. For us, it always starts with management. This management team has shown that they know oil and gas in Saskatchewan. They have tremendous geology skills. Their success rate in drilling is always between 80 to 90 per cent,” said Kook.
He credits strong management expertise and the amazing drilling success rate combined with continued strong oil prices for Golden’s strong investment return from the sale of Romulus shares.
Golden Opportunities is Saskatchewan’s first and largest labour-sponsored fund and holds investments in 38 private companies across nine industry sectors in the province.
© The StarPhoenix (Saskatoon) 2005