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by Stockwatch Business Reporter

West Texas Intermediate crude for May delivery lost $3.56 to $50.42 on the New York Merc, while Brent for May lost $3.55 to $55.55 (all figures in this para U.S.). Both benchmarks gave back most of their gains over the previous two days, as data from the U.S. Energy Information Administration showed the largest weekly rise in domestic crude supplies in 14 years. Western Canadian Select traded at a discount of $12.05 to WTI ($38.37), up from a discount of $12.35. Natural gas for May lost 6.1 cents to $2.61. The TSX energy index lost 5.25 points to close at 226.11.

Henry Hamm's DeeThree Exploration Ltd. (DTX) lost 57 cents to $6.50 on 4.16 million shares. The market frowned on its plan to reorganize into two public companies, each of which will focus on one of DeeThree's two core areas, the Alberta Bakken play (producing 3,900 barrels of oil equivalent a day) and the Alberta Belly River play (producing over 8,000 barrels a day). The Bakken assets will form the basis of Granite Oil, which will pay a monthly dividend of three cents. The Belly River assets will be held by a growth-only company called Boulder Energy. Investors will receive 0.5 of a share of Boulder and 0.33 of a share of Granite for each DeeThree share. DeeThree clearly thinks the sum of the parts is greater than the whole, but the market is less sure. The wild card for Granite is the production decline rate of the Bakken assets. This has averaged 40 per cent over the last few years, which is high for a company trying to support a dividend. DeeThree has been working to improve its decline rate through a gas-reinjection EOR (enhanced oil recovery) program. This program is less than two years old, however, and although the results so far have been encouraging, full-scale implementation has only just begun. Granite's commitment to a dividend despite this early stage of work may worry investors. Boulder, meanwhile, will focus on increasing production in the Belly River, a play that has certainly supported that ambition so far. DeeThree entered in 2011 and has since taken production to 8,000 barrels a day from less than 1,000. Martin Cheyne, DeeThree's president, CEO and founder, has chosen to stick with this play. He will become CEO of Boulder. Clayton Thatcher, DeeThree's vice-president of exploration, will become president of Boulder. Over at Granite, the president and CEO positions will be held by Michael Kabanuk, DeeThree's executive chairman. Before becoming a director of DeeThree in mid-2008, Mr. Kabunuk was COO and operations vice-president at Cyries Energy, and before that held various positions at Cequel Energy.

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