Telecom and oil are an unlikely pair. But for IDT Corp. (NYSE: IDT). which specializes in telecom services and oil exploration, the combination has worked well. Shares of IDT Corp. were up 13 percent from Friday’s (June 25th, 2010) close, likely because of a new CNBC interview with the company’s founder, chairman and CEO, Howard Jonas that outlined the company’s oil shale venture in Colorado (below).
IDT’s shale operation focuses on heating shale rock and extracting oil. “So we can bring this up without any environmental consequence,” said Jonas. “The problem in Colorado up to now was that there were aquifers that run through the rock. So what we did was find a way to go down into the clay level.”
IDT’s energy business, Genie Energy, holds IDT’s interests in the American Shale Oil, LLC (AMSO), a joint oil shale research and development venture in Colorado with Total, S.A.; and in Israel Energy Initiatives (IEI), which holds an exclusive shale oil exploration and production license in the Shfela region of Israel.
According to Jonas, it costs the company about $25 per barrel to extract the oil from shale rock, which is about $10 cheaper than ultra-deep water fuel extraction — the kind of extraction that was being used by British Petroleum (NYSE: BP) in the Gulf of Mexico.
Shares of IDT Corp. are up about 57 percent over the past three months.