Citadel has active exploration projects at Rancho Grande and Project Indian. My concern with Rancho Grande is the company's stated plan to eventually truck the oil to regional refineries, which I interpret to mean there is no pipeline network serving the area. I'd like to see how much the cost of truck transportation adds to each BOE, or if the company would consider building out a pipeline connection. My concern with Project Indian is the oil's heavy API gravity. Heavy oil is more costly to refine than light sweet, so this may eliminate the 10% price premium to WTI that California refineries are supposedly willing to pay for California production.
The company admits to going concern doubts in its 10-K dated August 13, 2013. I noticed that executive compensation makes up a significant part of their operating expenses and has been increasing since 2012. They had $307K cash on hand as of June 30 and a burn rate of approximately $100K/month. The good news is that they have successfully raised cash and wiped out notes payable in early 2013.
This is a young company with an old history. I want to hear more details on well results and logistics. The stock has traded below a buck since July but if oil is in this family's blood, they may strike pay dirt once again. That's why I'm going to keep watching this company's results.
Full disclosure: No position in COIL at this time.