It would be great to be the emir of Qatar, sitting atop massive reserves of natural gas as prices for the commodity parallel the rise in crude oil prices and top $13 per million Btu.

But as a small-cap investor you can get the next best thing with GMX Resources, Inc. (Nasdaq:GMXR), a “pure play” exploration and production company based in Oklahoma City. 

“Pure play” is when a company’s stock price correlates highly with a single product or investment theme — in this case, natural gas. Much of the play in this pure play is the next big thing in U.S. gas production — the Haynesville Shale in eastern Texas and western Louisiana, which some experts think may turn out to be as big as the Barnett Shale under the Dallas Fort Worth metro area.

A test in late May of a well owned by Penn Virginia (NYSE:PVA) that lies just west of GMX’s acreage showed strong production potential at relatively low cost and is prompting GMX to accelerate its own plans for development.

Tests on Haynesville and Bossier shale sites neighboring that of GMX's acreage have been running so positive that analysts at Jefferies & Co. decided to raise their target on GMXR to $63 from $48 on June 2, 2008. On June 17, GMX announced the acquisition of 9,865 gross / 7231 net operated developed and undeveloped acres mostly in Harrison County, East  Texas and Caddo Parish North Louisiana, which includes an average of 85% working interest in 11 units, producing 1,900 mcfepd. The news sent the stock price up to new highs over $70.    

To reflect the increased acreage position and rig development in Haynesville, on June 18, Jefferies raised their price target on GMXR to $82 from $63. This price target upgrade was on the heels of Collins Stewart's June 17th increase in price target to $86 from $67, also to reflect GMX's increased acreage position.   

Referring to the Penn Virginia test, GMX chief executive Ken Kenworthy said on a May 7 earnings conference call that indications are that the GMX properties have even bigger seams of porosity — that is, where gas is likely to be . . .

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