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by Stockwatch Business Reporter

West Texas Intermediate crude for August delivery added 21 cents to $46.16 on the New York Merc, while Brent for September added 26 cents to $47.87 (all figures in this para U.S.). Western Canadian Select traded at a discount of $13.70 to WTI ($32.46), up from a discount of $13.80. Natural gas for August lost 0.1 cent to $2.755. The TSX energy index lost 1.12 points to close at 192.76.

Clay Riddell's Trilogy Energy Corp. (TET), focused on the Alberta Montney and Duvernay, added five cents to $6.12 on 362,300 shares. It has risen from $5.47 so far this month, taking a particularly big jump on July 6, the day on which Paramount Resources Ltd. (POU: $12.49) -- another Riddell family promotion and the company that spun out Trilogy in 2005 -- arranged a $1.9-billion sale of Montney assets in Alberta's Deep basin to Seven Generations Energy Ltd. (VII: $27.24). Analysts have since busied themselves speculating on what the sale could mean for Trilogy. Raymond James analyst Kurt Molnar sees it as evidence that the "probabilities of positive developments regarding Trilogy's Duvernay [assets] are rising rapidly." Trilogy has nearly 200 Duvernay sections and has long expressed interest in sales or joint ventures to ease the pressure on its balance sheet. It did manage a sale of 11 sections last year, fetching $85-million (U.S.), but net debt remains daunting at over $560-million (as of March 31). Mr. Molnar says the Duvernay could be used to "effectively delever" the balance sheet and allow Trilogy to "re-engage high return on capital growth." It could, for example, focus on its "superior but unrecognized" Montney oil assets. The Riddells have a history of "transacting strategically," continues Mr. Molnar, pointing to both Trilogy's asset sale in November and Paramount's asset sale this month. Given the Riddells' "newfound financial flexibility" and other factors, Mr. Molnar is raising the bar for what Trilogy's Duvernay assets could fetch. He had previously valued the assets at $5-million a section, but now says $6-million. He has also raised his price target on Trilogy's stock to $10 from $8.50.

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