Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
This is going to be along and profitable ride. Sit back and enjoy.
Red
Oh my gosh
http://www.angelnexus.com/o/web/50122
Red
Interesting article, considering that on the new September NZ PresentTION, AND ALSO CONSIDERING THE COLOR MAP IN THAT PRESENTATION, it appears that NZ has more acreage than the other players.
Good read :
http://www.321energy.com/editorials/moriarty/moriarty090313.html
Red
McBeanburger, thanks for bringing this up. NZ does not have a JV with Marauder at this point. However, should Marauder have to come up with some future money to cover it's 50% partnership pre-drilling or drilling expenses or donation to the XOP/Marauder combined expenses, it's likely a deal with Lundin may arise, because Marauder is not unfamilar to Lundin or Hill.
JMO
Red
not sure what you refer here Red:
NZ energy has a 50% JV with Marauder's extensive acreage in this same structure
Canadian Overseas has a 50% JV with Marauder or are you saying that NZ's acreage is besides XOP/MES's property?
I hope u are right red lundin would make a good financing partner!
Korpin, ...and because of the oil-in-place, some are predicting a $27 share price.
We'll know how Tag's drill results ( on a different section of the same structure ) came out on Monday through Casey Energy reports.
I'm convinced this is a play that Lundin will not pass on. Also, not figured into the predictions is the fact NZ energy has a 50% JV with Marauder's extensive acreage in this same structure. Lundin and Keith Hill are friends with Bobby Shields, CEO of Marauder.
Red
hey red! I think its worthy of risk..bought 5000 shares myself at .33 a few days ago...not as big as AOIFF but a great entry point at less than face value..check out lightstream resources also selling near low...AND gives monthly dividend!
Shares pretrty tight. Every purchase was only partial buys, and then they bumped up the ask.
Red
thanks tamtam! VERY creative financing for origin blocks perhaps not ideal but no dilution or loan!...now if they can get production costs down...looks like this horse has a chance to run!!
September Corporate Presentation
http://www.newzealandenergy.com/files/doc_presentations/NZECPPT_201309_06.pdf
Tamtam
high production costs
from what I have read,it is costing NZERF 73.62 USD per barrel to produce PLUS a 5% royalty to the New Zealand govt which comes out to 22.46 per barrel profit IF oil is selling at 100.96 a barrel average...I have read that due to high production rates in north America,average price per barrel is set to fall to around the 86.00 dollar range in 2014...which means 8.00 USD profit per barrel if everything else stays the same this company is finished UNLESS they can bring down production costs I may buy on a dip in the hope of lower production costs/their new blocks pay out
]
as far as the acquisition goes IF they do indeed go the dilution route do you people on this board believe that is already priced in or there will be a further drop in stock price?
I think this is a very good entry point.
I like this play. Have been taken to the woodshed a little bit, but am averaging down now. I have the faith.
Twister,Do you hold any TXXV:NZ stock? May I inquire as to why you are so negative on this Company?
Thanks pennybuster. I am finding it difficult to get the latest info on this stock, even with half a dozen sources, and NZERF puts out info infrequently. Any suggestions? Thank You
from here, short term 2013 i'd give it a 9.
overall is anyone's guess.
Anyone concerned about capital needed for Origins? Can anyone describe confidence level in this stock from 1(lowest) to 10? Appreciate any and all feedback
New Zealand Energy Announces First Quarter Results and Operational Update
VANCOUVER, BRITISH COLUMBIA --(Marketwired - May 29, 2013 ) - New Zealand Energy Corp. ("NZEC" or the "Company") (TSX VENTURE:NZ)(OTCQX:NZERF) has released the results of its first quarter ended March 31, 2013 . Details of the Company's financial results are described in the Unaudited Consolidated Financial Statements and Management's Discussion and Analysis which, together with further details on each of the Company's projects, will be available on the Company's website at www.newzealandenergy.com and on SEDAR at www.sedar.com. All amounts are in Canadian dollars unless otherwise stated.
HIGHLIGHTS
Quarterly results
30,179 barrels of oil ("bbl") produced and 27,246 bbl sold in Q1-2013, generating pre-tax oil sales of $3,061,064
Positive net cash flow from petroleum operations in Q1-2013 of approximately $1.2 million
Average field netback of $45.29 /bbl in Q1-2013, a 16% increase compared to Q4-2012
Cash invested in resource properties, plant and equipment during Q1-2013 of $12,048,313
Cumulative results
43,360 bbl produced and 43,634 bbl sold year to date ( May 24, 2013 ), generating pre-tax oil sales of approximately $4.7 million
Cumulative production of 251,581 bbl since commencement of production, generating pre-tax oil sales (including sales from pre-production testing) of approximately $26.8 million
Developments
Engaged independent reservoir management firm to analyse Copper Moki wells and reservoir with the objective of optimizing oil recoveries
Completed 50-km 2D seismic survey on Wairoa permit in the East Coast Basin
Initiated consent and permitting for two East Coast Basin exploration wells
Extended the maturity date of the HSBC operating line of credit to September 30, 2013
Progressed acquisition of assets from Origin: received Overseas Investment Office approval related to Waihapa Production Station land, working with Origin to finalize certain terms of the agreement
FINANCIAL SNAPSHOT
Current
quarter
ended
March 31, 2013 Preceding
quarter
ended
December 31, 2012 Comparative
quarter
ended
March 31, 2012
Production 30,179 bbl 29,516 bbl 39,852 bbl
Sales 27,246 bbl 29,901 bbl 34,659 bbl
Price 112.35 $/bbl 103.98 $/bbl 117.94 $/bbl
Production costs 62.08 $/bbl 59.63 $/bbl 22.25 $/bbl
Royalties 4.98 $/bbl 5.39 $/bbl 5.16 $/bbl
Field netback 45.29 $/bbl 38.96 $/bbl 90.53 $/bbl
Revenue 2,925,258 2,948,042 3,908,683
Pre-production recoveries - 338,321 1,351,630
Total comprehensive income (loss) 1,313,397 (1,333,805 ) 799,032
Net finance expense (income) 17,887 (11,548 ) (18,311 )
(Loss) earnings per share - basic and diluted (0.02 ) (0.02 ) 0.00
Current assets 48,199,638 49,137,637 76,167,931
Total assets 129,545,992 116,059,939 96,979,923
Total long-term liabilities 3,273,617 2,598,840 250,559
Total liabilities 33,939,619 23,442,632 6,017,299
Shareholders' equity 95,606,373 92,617,307 90,962,624
Note: The abbreviation bbl means barrel or barrels of oil.
During the three-month period ended March 31, 2013 , the Company produced 30,179 barrels of oil and sold 27,246 barrels for total oil sales of $3,061,064 , averaging $112.35 per barrel. Total recorded production revenue net of a 5% royalty payable to the New Zealand Government (an average of $4.98 per barrel) was $2,925,258 . Production costs during the three-month period ended March 31, 2013 totalled $1,691,405 , or an average of $62.08 per barrel, generating a field netback on average of $45.29 per barrel during the first quarter. NZEC calculates the netback as the oil sale price less fixed and variable operating costs and a 5% royalty. While the field netback in Q1-2013 increased compared to the last quarter as the result of a higher realized oil price, field netbacks have declined compared to Q1-2012 as the result of decreased oil production related to well declines coupled with higher fixed production costs as a result of more wells coming into production during the prior year. Each new well site brings additional production costs to the Company in the form of equipment rentals and manpower.
The Company has also undertaken a number of reservoir and production tests in recent months with the objective of optimizing oil production, and these tests have added to production costs. During the three-month period ended March 31, 2013 , fixed production costs represented approximately 89% of total production costs. The Company is implementing measures to reduce production costs and increase oil production. In order to reduce production costs associated with manpower and equipment rentals, the Company installed permanent production facilities at the Copper Moki site. Installation was completed in May and the facilities are currently being commissioned. Permanent facilities are expected to reduce production costs considerably in future quarters as the equipment is owned by NZEC and operated and maintained by NZEC employees. In addition, the Company has engaged an independent reservoir management company to review the Copper Moki wells and identify opportunities to enhance recovery and optimize oil production from the wells.
At May 22, 2013 , the Company had an estimated $12.0 million in net working capital. This includes US$35 million that has been placed on deposit to satisfy the balance of the purchase price of the acquisition of assets from Origin, as summarized below in Property Review, Origin Agreement. The Company has secured a US$34.5 million operating line of credit against the US$35 million deposit and to date has drawn down US$27.4 million . The Company is considering a number of options to increase its financial capacity to carry out the acquisition of assets and other anticipated activities.
PROPERTY REVIEW AND OUTLOOK
Taranaki Basin
The Taranaki Basin is situated on the west coast of the North Island and is currently New Zealand's only oil and gas producing basin, with total production of approximately 130,000 boe/d from 18 fields. Within the Taranaki Basin , NZEC holds a 100% interest in the Eltham Permit; a 65% interest in the Alton Permit in joint arrangement with L&M and a 60% interest in the Manaia Permit in joint arrangement with New Zealand Oil & Gas ("NZOG"). The Eltham Permit covers approximately 93,166 acres (377 km2) of which approximately 31,877 acres (129 km2) are offshore in shallow water. The Alton Permit covers approximately 119,204 onshore acres (482 km2). NZEC increased its interest in the Alton Permit from 50% to 65% by completing the acquisition and processing of approximately 50 km2 of 3D seismic across the northern end of the permit. Transfer of the additional 15% interest was approved by NZPAM on December 21, 2012 . The Manaia Permit covers approximately 27,426 onshore acres (111 km2) and was granted to NZEC and NZOG in December 2012 as part of the annual New Zealand block offer for exploration permits.
NZEC also expects to acquire four Petroleum Licenses and the Waihapa Production Station upon completion of the acquisition of assets from Origin, as outlined below under Origin Agreement.
Production
NZEC has drilled ten wells on its Eltham Permit and made six oil discoveries, with results still pending from one well. At the date of this MD&A, four wells have been advanced to commercial production. The wells are producing light oil that is trucked to the Shell-operated Omata tank farm and sold at Brent pricing. Cumulatively, as of the date of this report, the Company has produced approximately 251,581 barrels of oil, with cumulative pre-tax oil sales of approximately $26.8 million , including sales from oil produced during testing (net results of operations are discussed under Results of Operations). Over 20 production days in May 2013 , the wells have collectively produced oil at an average rate of 225 bbl/day and generated gas at an average rate of 621 mcf/day.
Copper Moki-1 has been producing from the Mt. Messenger formation since December 10, 2011 . Copper Moki-2 has been producing from the Mt. Messenger formation since April 1, 2012 . Copper Moki-3 has been producing from the Mt. Messenger formation since July 2, 2012 . The wells produce ~42° API oil and flowed from natural reservoir pressure until October 2012 , when NZEC began installing artificial lift (pump jacks) to stabilize production rates. All three wells are now producing with artificial lift.
Waitapu-2 has been producing from the Mt. Messenger formation since December 20, 2012 . The well produces ~40° API oil and has continued to flow from natural reservoir pressure, and will require artificial lift in the near term. To assist with reservoir studies at the Copper Moki wells, NZEC has run down-hole gauges into Waitapu-2 that will continually measure the bottom hole temperature and pressure of the reservoir. Like the Copper Moki wells, Waitapu-2 is producing from the Mt. Messenger formation and the data will provide a good analogue for the Copper Moki reservoir. Waitapu-2 will be shut in towards the end of May for up to 90 days to gather valuable information for the planned reservoir study, while the Company also evaluates artificial lift options for the well.
Production declines from the Copper Moki wells have been greater than expected and have prompted the Company to initiate a reservoir review. These wells are known to produce low pour point oil with associated wax. While a decline in production is expected over time, it is possible that the higher decline rates may be due not to reservoir conditions but rather to mechanical issues, including wax build-up down-hole. Oil analysis shows that the wax appearance temperature may be only slightly lower than the bottom-hole temperature, allowing wax to build up around the pump, in the perforations and potentially in the formation itself. The Company has conducted a number of tests to resolve this issue and has found that flow from the wells improves following condensate washes, which dissolve wax that has formed around the pump. The team is analysing the results of condensate washes conducted to date in order to identify the optimal interval between each wash. Information collected from the Waitapu-2 gauges will provide additional insight into the formation temperature and wax issues. Further work has been carried out by an independent firm to develop a pour point depressant that could be used to treat wax deposition at the pump and well bore. A trial is planned in the near term. In addition, the Company has engaged an independent reservoir management company to investigate the cause of and identify remedies to these issues in an effort to optimize oil production. Such remedies may include stimulation of well flow with condensate washes, modified pumping mechanisms or other forms of reservoir stimulation.
All four producing wells generate both oil and liquids-rich natural gas; however, the Company is not yet generating cash flow from natural gas production. The Company has completed a natural gas pipeline from the Copper Moki site to the Waihapa Production Station and is considering a number of options to tie-in the Waitapu site, including the possibility of building a pipeline to deliver Waitapu's rich gas to the Copper Moki site and on to the Waihapa Production Station through the existing Copper Moki pipeline. A pipeline would minimise infrastructure at the Waitapu site, and ultimately reduce production costs associated with the well. The Company will consider all options as it evaluates the economics associated with artificial lift and infrastructure at the Waitapu site.
Origin Agreement
In May 2012 , the Company entered into the Origin Agreement with Origin to acquire upstream and midstream assets (the "Acquisition"). These assets include four Petroleum Licenses totalling 26,907 acres as well as the Waihapa Production Station and associated gathering and sales infrastructure.
Under the terms of the Origin Agreement, and pursuant to an exclusive arrangement, the Company has agreed to pay Origin consideration in the amount of $42 million in cash, payable in the US$ equivalent at a fixed C$/US$ exchange rate of 1.0349 ( US$40.6 million ), and such other adjustments as may be required at closing. A $5 million deposit was paid with the remainder due on closing.
Closing of the Acquisition is conditional on the following:
Condition Status
1. NZPAM approval for transfer of the Petroleum Licenses NZPAM has voiced support for the transaction
2. New Zealand's Overseas Investment Office approval for acquisition of the land upon which the Waihapa Production Station is situated Approval obtained
3. Origin completing recommissioning of the TAWN LPG plant Plant has been certified for operation
4. Origin and/or NZEC entering into an agreement with Contact Energy regarding the use and development of the Ahuroa gas storage facility In process
5. TSX Venture Exchange conditional approval Approval obtained
While certain delays have been experienced in completing the Acquisition and related documentation, the Company has continued to engage with Origin in order to finalize certain terms contained in the Origin Agreement. Management continues to work diligently with the aim of concluding this transaction during Q2-2013, subject to increasing the Company's financial capacity in order to meet its commitments under the Origin Agreement.
Outlook - Taranaki Basin
On February 25, 2013 , the Company announced the decision to delay the remaining two wells in its Eltham/ Alton drill program to focus on commercial opportunities in the pending acquisition of assets from Origin. The Company's objective is to increase near-term production and cash flow while reducing exploration expenses, and the Company believes that opportunities exist on the Petroleum Licenses to achieve this objective. While this decision in no way diminishes the Company's view of the prospectivity of the Eltham and Alton permits, NZEC intends to focus in the near-term on lower-cost opportunities that are close to infrastructure. The acquisition from Origin includes Petroleum Licenses that are central to a network of oil and gas gathering pipelines and the full-cycle Waihapa Production Station .
The Company's technical and engineering teams, working with independent experts, continue to investigate options to enhance recovery and performance from the Copper Moki and Waitapu wells. In addition, a review is underway to evaluate NZEC's drilling and completion operations to date, in parallel with reprocessing and interpretation of the Company's extensive 3D seismic data, with the goal of recommencing drilling operations early in the third quarter of 2013. The Company has one remaining commitment well on its Alton permit and expects to commence drilling a Mt. Messenger target well in Q3-2013. The Company is responsible for expenditures and is entitled to profits for its respective interest (65% NZEC / 35% L&M).
Upon closing of the acquisition of assets from Origin, NZEC plans to reactivate six wells in the Tikorangi formation using an established gas lift system. Reactivation of these wells is pending the completion and commissioning of Contact Energy's new 18" pipeline, which is expected to provide the gas source to lift these wells. NZEC has also determined that six previously drilled wells on the Petroleum Licenses have uphole completion potential. Recompletion of these wells would be significantly less expensive and faster than drilling new wells, and economic discoveries could be quickly tied in to the Waihapa Production Station using existing oil and gas gathering pipelines. Both the reactivations and uphole completions could bring near-term, low-cost production and cash flow to the Company.
NZEC's technical team has also identified five high-priority Mt. Messenger targets in the southwest corner of the Petroleum Licenses. NZEC has completed permitting for a new site called Waipapa ( Oru Rd ) and expects that drill pad construction will be complete by mid Q3-2013, allowing the Company to access these targets shortly after the acquisition has closed.
Longer-term exploration plans on the Petroleum Licenses include accessing Mt. Messenger targets from existing drill pads, many of which have gathering pipelines in place, that offer lower-cost exploration potential and can be tied-in to the Waihapa Production Station on an expedited basis. NZEC is advancing a number of new commercial opportunities to use the Waihapa Production Station to its full potential and in order to maximize facility revenues, while ensuring that NZEC's gas and associated natural gas liquids production can be efficiently delivered to market.
Commercial oil discoveries on NZEC's properties and those of its peers have confirmed the prospectivity of the Mt. Messenger formation, which remains NZEC's primary exploration target in the near term. Mt. Messenger leads continue to be refined as the Company interprets its propriety database of 3D seismic. NZEC's technical team has also identified a number of leads in the deeper Moki, Tikorangi and Kapuni formations on both the Petroleum Licenses and the Eltham and Alton permits. Discoveries by other companies have demonstrated significant flow rates and long-term production from reservoirs in these deeper formations. NZEC will continue to advance these leads to drillable prospects and will move these targets higher on the Company's priority list as warranted.
East Coast Basin
The East Coast Basin of New Zealand's North Island hosts two prospective oil shale formations, the Waipawa and Whangai, which are the source of more than 300 oil and gas seeps. Within the East Coast Basin , NZEC holds a 100% interest in the Castlepoint Permit, which covers approximately 551,042 onshore acres (2,230 km2), and a 100% interest in the Ranui Permit, which covers approximately 223,087 onshore acres (903 km2) and is adjacent to the Castlepoint Permit. On September 3, 2010 , NZEC applied to the Minister of Energy to obtain a 100% interest in the East Cape Permit. The application is uncontested and the Company expects the East Cape Permit to be granted to NZEC upon completion of NZPAM's review of the application. The East Cape Permit covers approximately 1,067,495 onshore acres (4,320 km2) on the northeast tip of the North Island .
In addition, NZEC has entered into a binding agreement with Westech to acquire 80% ownership and become operator of the Wairoa Permit, which covers approximately 267,862 onshore acres (1,084 km2) south of the East Cape Permit. Preliminary approval of transfer of ownership was obtained from NZPAM on December 20, 2012 and formation of a joint arrangement with Westech is subject to completion of a joint operating agreement and final NZPAM approval. The Wairoa Permit has been actively explored for many years, with extensive 2D seismic data across the permit and log data from more than 15 wells drilled on the property. Historical exploration focused on the conventional Miocene sands. NZEC's technical team has identified conventional opportunities as well as potential in the unconventional oil shales that underlie the property. NZEC's team knows the property well and provided extensive consulting services (through the consulting company Ian R Brown Associates ) to previous permit holders, assisting with seismic acquisition and interpretation, wellsite geology and regional prospectivity evaluation. In addition, NZEC's team assisted with permitting and land access agreements and worked extensively with local district council, local service providers, land owners and iwi groups, allowing the team to establish an excellent relationship with local communities.
Exploration and Outlook
NZEC has cored two test holes on the Castlepoint Permit. The Orui (125 metres total depth) and Te Mai (195 metres total depth) collected core data across the Waipawa and Whangai shales. NZEC also completed a test hole on the Ranui Permit. Ranui-2 was drilled to 1,440 metres, coring the Whangai shale across several intervals. In Q2-2012, NZEC completed 70 line km of 2D seismic data across the Castlepoint and Ranui permits.
A review of the geochemical and physical properties of the two shale packages, coupled with information from seismic data, has focused NZEC's exploration strategy for the East Coast Basin . NZEC plans to drill one exploration well on both the Ranui and Castlepoint permits in Q4-2013. The Company has met regularly with local communities to discuss its exploration plans, and has initiated the permitting and consent process for the drill locations.
The Company recently completed and is processing a 50-km 2D seismic program on the Wairoa Permit that will help to identify exploration targets on the property, and will finalize its exploration plans for the permit after reviewing all of the seismic and well log data.
The Company's application for the East Cape Permit is uncontested and NZEC expects the permit to be granted upon completion of NZPAM's review of the application.
SUMMARY OF QUARTERLY RESULTS
2013
Q1
$ 2012
Q4
$ 2012
Q3
$ 2012
Q2
$
Total assets 129,545,992 116,059,939 98,882,087 98,814,102
Exploration and evaluation assets 49,610,922 37,379,726 26,377,188 25,373,718
Property, plant and equipment 25,793,089 23,867,758 16,293,123 8,674,152
Working capital 17,533,636 28,293,845 45,204,695 53,844,035
Revenues 2,925,258 2,948,041 3,708,254 5,910,993
Accumulated deficit (22,386,089 ) (19,992,243 ) (17,804,045 ) (15,613,594 )
Total comprehensive income (loss) 1,313,397 (1,333,805 ) (2,018,634 ) 1,317,915
Basic (loss) earnings per share (0.02 ) (0.02 ) (0.02 ) 0.01
Diluted (loss) earnings per share (0.02 ) (0.02 ) (0.02 ) 0.01
2012
Q1
$ 2011
Q4
$ 2011
Q3
$ 2011
Q2
$
Total assets 96,979,923 31,152,804 33,566,611 10,683,239
Exploration and evaluation assets 12,103,712 6,052,699 9,509,095 4,641,525
Property, plant and equipment 8,150,802 5,509,511 63,421 68,366
Working capital 70,401,191 18,030,398 18,699,022 5,333,999
Revenues 3,908,683 974,517 - -
Accumulated deficit (16,548,180 ) (16,911,070 ) (17,057,134 ) (13,258,649 )
Total comprehensive income (loss) 799,032 (1,258,314 ) (4,279,538 ) (773,524 )
Basic (loss) earnings per share 0.00 0.01 (0.04 ) (0.01 )
Diluted (loss) earnings per share 0.00 0.01 (0.04 ) (0.01 )
On behalf of the Board of Directors
John Proust, Chief Executive Officer & Director
About New Zealand Energy Corp.
NZEC is an oil and natural gas company engaged in the production, development and exploration of petroleum and natural gas assets in New Zealand . NZEC's property portfolio collectively covers approximately 2.25 million acres (including pending permits) of conventional and unconventional prospects in the Taranaki Basin and East Coast Basin of New Zealand's North Island . The Company's management team has extensive experience exploring and developing oil and natural gas fields in New Zealand and Canada . NZEC plans to add shareholder value by executing a technically disciplined exploration and development program focused on the onshore and offshore oil and natural gas resources in the politically and fiscally stable country of New Zealand . NZEC is listed on the TSX Venture Exchange under the symbol "NZ" and on the OTCQX International under the symbol "NZERF". More information is available at www.newzealandenergy.com or by emailing info@newzealandenergy.com.
FORWARD-LOOKING INFORMATION
This document contains certain forward-looking information and forward-looking statements within the meaning of applicable securities legislation (collectively "forward-looking statements"). The use of any of the words "objective", "implementing", "in order to", "expected to", "review", "identify", "enhance", "optimize", "is considering", "increase", "carry out", "expects to", "upon completion", "will require", " will", "pending", "will provide", "will be", "analyzing", "planned", "investigate", "may include", "would", "will consider", "evaluate", "may be required", "conditional on", "goal of", "recommencing", "entitled to", "plans to", "potential", "could", "expects", "can be", "will continue", "to acquire", "subject to", "initiated", "will help", and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct. Such forward-looking statements included in the document should not be unduly relied upon. These statements speak only as of the date of the document. This document contains forward-looking statements and assumptions pertaining to the following: business strategy, strength and focus; the granting of regulatory approvals; the timing for receipt of regulatory approvals; geological and engineering estimates relating to the resource potential of the Properties; the Company's future production levels; the estimated quantity and quality of the Company's oil and natural gas resources; supply and demand for oil and natural gas and the Company's ability to market crude oil, natural gas and natural gas liquids production; and expectations regarding the ability to raise capital and to continually add to resources through acquisitions and development; future commodity prices; the Company's ability to obtain qualified staff and equipment in a timely and cost-efficient manner; the ability of the Company to progress through the conditions precedent to conclude the acquisition of assets from Origin on schedule, or at all; the ability of the Company's subsidiaries to obtain mining permits and access rights in respect of land and resource and environmental consents; the recoverability of the Company's crude oil, natural gas and natural gas liquids resources; future capital expenditures to be made by the Company; and future cash flows from production meeting the expectations stated herein.
Actual results could differ materially from those anticipated in these forward-looking statements as a result of the risk factors set forth below and elsewhere in the presentation, such as the speculative nature of exploration, appraisal and development of oil and natural gas properties; uncertainties associated with estimating oil and natural gas resources; changes in the cost of operations, including costs of extracting and delivering oil and natural gas to market, that affect potential profitability of oil and natural gas exploration; operating hazards and risks inherent in oil and natural gas operations; volatility in market prices for oil and natural gas; market conditions that prevent the Company from raising the funds necessary for exploration and development on acceptable terms or at all; global financial market events that cause significant volatility in commodity prices; unexpected costs or liabilities for environmental matters; competition for, among other things, capital, acquisitions of resources, skilled personnel, and access to equipment and services required for exploration, development and production; changes in exchange rates, laws of New Zealand or laws of Canada affecting foreign trade, taxation and investment; failure to realize the anticipated benefits of acquisitions; and other factors. Readers are cautioned that the foregoing list of factors is not exhaustive. Statements relating to "resources" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the resources described can be profitably produced in the future. The forward-looking statements contained in the document are expressly qualified by this cautionary statement. These statements speak only as of the date of this document and the Company does not undertake to update any forward-looking statements that are contained in this document, except in accordance with applicable securities laws.
Contact Information:
New Zealand Energy Corp.
John Proust
Chief Executive Officer & Director
North American toll-free: 1-855-630-8997
New Zealand Energy Corp.
Bruce McIntyre
Executive Director
North American toll-free: 1-855-630-8997
New Zealand Energy Corp.
Rhylin Bailie
Vice President Communications & Investor Relations
North American toll-free: 1-855-630-8997
New Zealand Energy Corp.
Chris Bush
New Zealand Country Manager
New Zealand : 64-6-757-4470
info@newzealandenergy.com
www.newzealandenergy.com
-------------------
To unsubscribe from this list please visit the email alert section of the New Zealand Energy site.
Date Sent: 5/29/2013 7:07:10 AM Powered by Q4 Web Systems
I still follow it-
Here's an interesting piece-
http://stockgumshoe.com/reviews/crisis-and-opportunity/new-zealands-bakken-sniffing-around-christian-dehaemers-oil-teaser/
futr
New Zealand Energy Corp. is an oil and natural gas company engaged in the exploration, development and production of petroleum and natural gas assets in New Zealand. The company's property portfolio collectively covers nearly two million acres of conventional and unconventional prospects in New Zealand's North Island. Its management team has decades of experience exploring and developing oil and natural gas fields in both New Zealand and Canada, with a track record of successful discoveries.
NZERF On the Pinksheets.
Expert Comments:
David Buma, M Partners (4/26/13) "We continue to rate New Zealand Energy Corp. shares Buy with a one-year price target of $1. . .we highlight the material growth expected out of the Taranaki over the medium term combined with the potential upside offered by the East Coast Basin. Near-term catalysts include progress in identifying the production issues, conclusion of the Origin deal and its related funding, and increased interest in the East Coast as industry activity has commenced in the region with TAG Oil Ltd. spudding its first well there earlier this week."
David Dudlyke, Dundee Securities (4/25/13) "It is worth pointing out that New Zealand Energy Corp., at an enterprise value of some $45M (versus TAG Oil Ltd. at $264M) clearly offers superior leverage to any future exploration success in the East Coast basin. By way of context, New Zealand Energy holds a larger acreage position and almost twice the unrisked unconventional prospective resource within New Zealand's East Coast Basin than that of TAG Oil."
David Popowich, Macquarie Capital Markets (4/4/13) "New Zealand Energy Corp. has been swab testing the Arakamu-2 well for a period of 13 days, recovering a total of 407 bbl 42° API oil; while the simple headline test rate (approximately 30 bblpd oil) appears underwhelming, the company is optimistic this will improve on pump. Nevertheless, with an oil cut of just 20%, even the ability to pump 500 bblpd total fluid would imply initial oil production of ~100 bblpd."
David Buma, M Partners (4/4/13) "New Zealand Energy Corp. announced yesterday that workover efforts at Arakamu-2 were successful. . .this well does represent the company's sixth oil discovery in the Taranaki Basin. . .cash flow generation is not expected until the pump is installed, potentially in late Q2/13. . .we continue to rate New Zealand Energy shares a Buy, based on the material growth expected out of the Taranaki over the medium term combined with the potential upside offered by the East Coast Basin, where industry activity is set to begin as early as this month."
Deborah Bacal, Proactive Investors (4/3/13) "New Zealand Energy Corp. has made its sixth oil discovery in the Taranaki Basin, showing what the company called a strong inflow of oil, gas and water. The junior oil and gas producer started testing the Arakamu-2 well in the middle of last month. . .last week, in a step forward, the company announced that it received approval from New Zealand's Overseas Investment Office to obtain the Waihapa Production Station site, putting it one step closer to completing its acquisition of assets from Origin Energy. . .it expects to meet all conditions in order to conclude the transaction in the second quarter of this year."
New Zealand Energy Corp. Content
NZ E and P Activities
NZ: Energy Production and Exploration Activities
New Zealand Energy Al Korelin
NZ's Strategic Acquisition
Corporate Presentation (4/26/13)
Fact Sheet (4/3/13)
http://www.theenergyreport.com/pub/co/3614
The Bakken formation in North Dakota has made plenty of millionaires, not just among the ranchers who owned those cold and dusty acres in the decades before shale oil production became feasible, but for those who invested early in the companies that made the best discoveries or gobbled up the best acreage.
And the Bakken is in the headlines every day as the key to US energy independence (or, at least, lessened dependence on oil imports), so it’s perfectly understanding that the copywriters trot out the name whenever they’re trying to sell the next big shale discovery — we’re always looking for the “next Bakken”, whether it’s in Argentina or Paris or Poland or, as in this teaser today from Christian DeHaemer, in New Zealand.
Ring a bell? Yes, we ran a piece on a shale oil teaser from Keith Schaefer way back in October, also using the same basic “Next Bakken” pitch … that particular stock hasn’t worked out well so far, with some weak drilling results (that’s an understatement — it’s down from about $1.50 to 35 cents), but, well, nothing about the energy exploration business is guaranteed or easy, right? I don’t know yet whether Dehaemer’s touting this same company, but I’m at least curious enough to feed the clues into the Thinkolator so we can find out for you.
Here’s the big picture tease, all about how the New Zealand shale is bigger and thicker than the Bakken and therefore hugely exciting:
Irregulars Quick Take
Paid members get a quick summary of the stocks teased and our thoughts here. Join as a Stock Gumshoe Irregular today (already a member? log in at top right)
“New Zealand’s Bakken!
“A massive shale formation found in the Kiwi Nation is so huge and untouched, the New Zealand Herald reports: ‘It’s literally leaking oil and gas’
“An independent report released in October 2012 says this shale field could hold more oil than the combined reserves of Chevron, ConocoPhillips, and Royal Dutch Shell…
“Geologists have discovered at least 300 spots where oil and gas are bubbling at the surface.
“These two companies (both trading below $10 a share) control over 5,000 square miles of the emerging oil field… and production has already started….
“On the North Island of New Zealand — about 268 miles from Auckland — sits the small town of Hastings.
“For decades there’s been nothing remarkable about this small port town… until now.
“Massive oil deposits surrounding Hastings have been found that are 10x larger than the infamous Bakken oil field.
“And the major permit holders to these deposits are two companies that I’m about to detail for you today….
“The Kiwi Nation’s Billionaire Dreams
“The geographical similarities between the Bakken and East Coast Basin are striking.
“And the government can already see the dollar signs.
“The Taranaki Basin on the North Island is already under development. So it’s clear the officials there are embracing fracking as a tool to their economic growth.
“‘I would love to see other regions experience the same economic boost, and fracking is one of the technologies than can allow that to happen.’ — Energy and Resources Minister Phil Heatley”
So … you can probably insert your own cautionary notes here: Every oil formation is different, there’s no guarantee that this shale oil will produce like the Bakken, the people of New Zealand might rise up against fracking, these are probably small companies without a lot of wherewithal to survive disappointing results, etc.
But that said, let’s see what Dehaemer’s clues are and try to ID the stocks for you. Here we go:
“New Zealand Bakken Opportunity #1
“The first opportunity you need to act on is an explosive growth stock that holds extensive amounts of oil and gas-laden land all over New Zealand.
“The last time they released news that they acquired new land for drilling… their stock shot from $.58 to $3.59 — a stunning 518% gain in just three months!
“They already control over 200,000 acres in the Taranaki Basin that hold nearly 78 million barrels of oil….
“They are snatching up land in the oil-rich East Coast Basin at a breakneck pace. Right now, they have the drilling rights to over two million acres. You didn’t read that wrong: Two million acres of land that are literally leaking oil everywhere.
“That’s huge! And it’s exactly what is going to shoot their share price into the stratosphere.
“They are slated to start drilling in an oil seep region of the East Coast Basin any day now…
“And when they hit oil, all hell is going to break loose with this company’s share price.
“… Their reserves are estimated at a stunning 22 billion barrels of oil by an independent research firm…
“Right now their stock is trading for less than a buck. This is a tiny company. But when they start pumping oil out of the East Coast Basin, their shares could easily balloon to $27 a share, according to some analysts.”
So … hoodat? Thinkolator sez that we are almost certainly looking at New Zealand Energy here (NZ.V in Canada, NZERF on the pink sheets). Yes, the same one teased by Keith Schaefer last Fall — though back then it was around $1.50 (stabilizing there briefly on the way down from $3.50 or so), and now it’s right around 35 cents.
When it comes to matching clues, New Zealand Energy did not trade at 58 cents on the Venture exchange before rising to $3.59, as far as I can tell — the lowest price between their 2011 IPO and the spike in 2012 was around 80-90 cents. But it did rise to close at $3.60 early in 2012, and it has certainly been well below 58 cents since then … and pretty much everything else is a spot-on match. Their holdings in the Taranaki Basin, which is on the west side of the North Island and is where pretty much all New Zealand oil and gas production has been taking place for decades, does indeed have “best case” resources of just under 78 million barrels (77.1 “Net Unrisked Prospective Recoverable” million barrels, per their latest presentation), and a lot more potential oil and gas that hasn’t been discovered. They recently invested more in this producing area, picking up some assets from Aussie giant Origin Energy (and perhaps further stressing their balance sheet, which, in addition to recent bad drilling results, seems to be part of the reason the shares are down).
The “New Zealand Bakken” bit, though, refers to their search for unconventional oil on the east side of the island — that’s where the 22 billion barrels number starts getting thrown around, though even a consultant shouldn’t be putting the word “reserves” next to that 22 billion, that’s what they have on their estimate as “Net Unrisked Undiscovered Petroleum.”
And it should perhaps be obvious, but I’ll say it anyway: “Undiscovered” oil is not as useful, nor nearly as valuable, as oil that you’ve found and can produce.
I’m certainly no expert on New Zealand oil, but this strikes me as now becoming an extremely levered play on New Zealand discoveries — they’ve made an acquisition to increase their current production from the Taranaki basin, an area where the ongoing search to replace dwindling large gas fields is certainly underway, but the market is giving them essentially no credit for that conventional oil and gas production, the market cap is down to about $40 million now, very, very small and not much more than they agreed to pay for the Origin Energy fields they’re trying to buy (they’re also using a line of credit for that, apparently).
That’s probably largely because they’ve rescinded their production guidance this year after having several wells disappoint (the four they’ve drilled this year have resulted in one “waiting for artificial lift analysis”, two dusters, and one with “completion pending” with “good hydrocarbon indications” … which is not what investors were looking for after they had hit on a few successful producing wells in a row. You can see the latest from them in their corporate presentation here or their latest quarterly press release here (both are from last month) — they have a lot of exploration blocks and some other assets, including the production equipment, they are producing from some of their conventional wells, but they’re running pretty low on cash and have a lot of exploration work to do before (if) they book any big reserves, particularly on those possible “New Zealand Bakken” assets. Production grew a lot in 2012 as they brought their first wells online, but that lack of production guidance for this year raises, it seems to me, some questions about how fast they’re going to burn through their relatively small pile of remaining cash — they spent about $40 million last year in exploring and acquiring blocks and equipment, and brought in $16 million in revenue, but the production did grow throughout the year so without guidance I wouldn’t want to guess what their production or revenue will be for 2013.
One thing they did that was clearly quite brilliant was raise a lot of cash when the shares were at $3 — that’s why they have some financial wiggle room — but I think they’ll need some production or exploration success pretty soon to get any recovery in the share price over the coming months. On the flip side, the stock is so beaten down, getting down close now to the value of their proven and probably reserves, that any success could certainly drive the shares higher very quickly. I expect there are probably some Gumshoe readers who follow this one more closely than I, so feel free to chime in if you’ve got some more details or prognostications to share.
And the second “New Zealand Bakken” stock? Here are our clues:
“New Zealand Bakken Opportunity #2
“Not to be outdone is my second New Zealand Bakken opportunity…
“This company — trading at just over $4 — has been involved in the New Zealand energy market for over 11 years.
“Just like our first opportunity, this company has been fracking in the Taranaki region of the North Island. Their property there holds over 600 million barrels of oil and 7 trillion cubic feet of natural gas!
“They also own and operate 100% of all their facilities… including the pipelines….
“It’s paid off: They saw a 227% increase in production during 2012. And in 2012 revenue increased 228%, right along with production….
“they went on an aggressive land-buying spree… to the tune of 1.7 million acres! That’s an area bigger than the state of Delaware.
“They did what they needed to and grabbed as much land as they could. And it was all around the oil seeps in the East Coast Basin.
“They believe there is up to 14 billion barrels of oil there.
“At the $100 per barrel they can command for their premium product, their revenues are about to soar.
“They’re currently trading at just over $4 a share — but they won’t be for long…
“They’re about to drill four test wells in the East Coast Basin any day now.
“When news of their success gets out, I fully expect their shares will shoot up to $35, maybe higher… good for a whopping 775% winner!”
So though that sounds quite sexy, indeed, a gain of 775% is far less than the moonshot gains teased for New Zealand Energy — which makes sense, because here, according to the machinations of the Mighty, Mighty Thinkolator, we’re talking about a profitable, decent-sized (~$300 million) company called TAG Oil (TAO in Toronto, TAOIF on the pink sheets).
TAG Oil is over $4 a share, right around $4.85 at the moment (it’s down a bit today, it’s been over $5 for most of the month so far), the 14 billion number is in their data — that’s the “best case” number for their “undiscovered resources”, which are almost all in the unconventional shale plays to the East — though, like New Zealand Energy, they are actively producing oil and gas in the Taranaki region. Unlike New Zealand Energy, they are profitable and have no debt, so the exploration programs to potentially tap into that “New Zealand Bakken” seem to me, at just my first blushing glance, to be much more immediately feasible for TAG than for New Zealand Energy (even if the acreage or “undiscovered resource” is a bit smaller).
TAG Oil is in the process of drilling their first exploratory wells in the East Coast Basin (that’s the “Bakken-like” shale part), and it sounds as though the drilling has been challenging but there are no real results yet. They did have a farm-in partner, Apache (APA), on these blocks, but Apache backed out this year and paid them off with a lump sum — I don’t know whether that’s an assessment by Apache that the project isn’t going to work, or that it simply didn’t fit in with their investment priorities (the company, of course, says the latter). Regardless, they say they’re funded for the four-well drill program in the East.
They’re also continuing to expand production from their larger finds in the Taranaki basin, where they also own much of the infrastructure and pipelines and can get the oil, gas and condensates to market — so they seem to be clearly the more stable of the two. They also certainly have some big upside potential if those unconventional shale plays turn out to be worthwhile — if they get a technique or a system or the right kind of fracking or whatever is needed to release that oil. And yes, fracking is used in New Zealand and has been for many years, though it is politically fraught — New Zealand’s government seems to approve permits for oil and gas as much as they can, given their strategic focus on growing that industry (which is already substantial, including some large offshore finds) both for internal consumption and for export, but I don’t really know New Zealand at all and I assume that could change. There are other players in the New Zealand energy patch, including some of the global majors and a smattering of others ranging from the decent-sized New Zealand Oil & Gas (NZO in Australia or New Zealand, NZEOY on the pinks) to the teensy Marauder Resources (MES in Canada, MESNF on the pink sheets), and many more that are partially or significantly focused on New Zealand (there’s a good list at the local petro association here), but none match our clues as well as these two … and I don’t think anyone else has as big a bet placed on the East Coast unconventional stuff, at least not that I’ve seen.
So that’s what I can offer you for now — looks pretty clear to me that the Thinkolator’s on target in pegging TAG Oil and New Zealand Energy as the two plays being teased by DeHaemer, and he has picked some good early exploration stories before (and some bad ones, of course). Will these really create a business on the scale of the “next Bakken?” Well, we’re very early in the game for that call — but drill bits are spinning and I expect we’ll be hearing (and seeing both stocks move) on the results of their unconventional shale exploration this year. I’ve never bought a company in New Zealand or a foreign shale explorer (well, unless Quebec counts — and that dabbling didn’t work well for me) … so let us know what you think with a comment below.
http://stockgumshoe.com/reviews/crisis-and-opportunity/new-zealands-bakken-sniffing-around-christian-dehaemers-oil-teaser/
futr
you still got this one. new update 4/25
http://www.newzealandenergy.com/)
cash down to 11 million.
only good news i see is tag may hit on the east coast and allow nzerf to raise more money.
anyone here
dough
nzerf new presentation no mention of the number 3000.
but with that said they still have some good property.
but can we ever trust mgt?
http://www.newzealandenergy.com/files/doc_presentations/NZECPresentation_201302.pdf
twister
you are correct no argument
Credibility crisis; 3000 barrels of smoke and mirrors!
What a change... To mom and pop style. First sign of success and right away they change focus from REAL production into building their pipe-dreams of processing tomorrow, while ignoring today. Instant success. The big time.
No additional drill rigs; not enough money.
Just rig hop-scotch and stuck tube.
And it seems they're now content drinking their own kool-aid 24/7 instead of doing some simple math to properly revise production estimates downward.
The slide continues.
What a change.
What a mess.
Clueless.
futrcash anyword on closing of the acquisition of the Origin Oil Assetts???
taoif is looking more and more like the clear winner in nz.
No way-
They'll be lucky to hit 1,200 even with good results.
This company is back to square one,and I'll be watching I'm not selling here,but I certainly don't see any reason to load up right now.
They have a lot to prove before they regain the markets confidence.
futr
alot depends on this well--Arakamu-1A reached target depth in the Moki formation at a vertical depth of 2,650 metres.
otherwise i dont see how we hit 3000 barrels like there calling for in few months?
New Zealand Energy Operational Update
Date : 01/17/2013 @ 7:00AM
Source : MarketWire
New Zealand Energy Operational Update
Print
Alert
New Zealand Energy Corp. ("NZEC" or the "Company") (TSX VENTURE:NZ)(OTCQX:NZERF) today provided an update on the Company's exploration and production activities in the Taranaki Basin of New Zealand's North Island.
Waitapu-2 commenced continuous production at the end of December 2012 and produced at an average rateof 151 barrels of oil per day over the first two weeks of January. The three Copper Moki wells (CM-1, CM-2 and CM-3) have collectively produced at an average rate of 273 barrels of oil per day over the first two weeks of January. All four wells are producing light (approx. 40 degrees API), high-quality oil from the Mt. Messenger formation. Oil is trucked approximately 45km to the Shell-operated Omata Tank Farm in New Plymouth and sold at Brent pricing, generating a top-tier netback.
Completion operations are underway at two wells on the Arakamu site. Arakamu-1A reached target depth in the Moki formation at a vertical depth of 2,650 metres. NZEC has cased the well to depth and will perforate the Moki formation shortly. In December the Arakamu-2 well was perforated across two intervals in the Mt. Messenger formation. A service rig is working on the well to remove stuck tubing in order to allow completion operations to proceed.
NZEC's contracted drill rig has been moved to the Wairere site and the Company expects to spud the Wairere-1 well by the end of the week, targeting the Mt. Messenger formation at approximately 1,900 metres. Wairere is NZEC's fourth drill site, located approximately 3.75 km southwest of the Company's Copper Moki site and 7.5 km southwest of the Waihapa Production Station.
On behalf of the Board of Directors
Bruce McIntyre, Executive Director
About New Zealand Energy Corp.
NZEC is an oil and natural gas company engaged in the production, development and exploration of petroleum and natural gas assets in New Zealand. NZEC's property portfolio collectively covers approximately 2.27 million acres (including pending permits) of conventional and unconventional prospects in the Taranaki Basin and East Coast Basin of New Zealand's north island. The Company's management team has extensive experience exploring and developing oil and natural gas fields in New Zealand and Canada, and takes a multi-disciplinary approach to value creation with a track record of successful discoveries. NZEC is listed on the TSX Venture Exchange under the symbol "NZ" and on the OTCQX International under the symbol "NZERF". More information is available at www.newzealandenergy.com or by emailing info@newzealandenergy.com.
futr
Guess that helps explain the pop today.
encouraging!
Might Something Similar be Developed in New Zealand?
Peak Oil or Peak Energy-a-Happy Solution?
http://www.ritholtz.com/blog/2012/12/peak-oil-or-peak-energy-a-happy-solution/
futr
New Zealand Energy Expands East Coast Exploration Land Package
PrintAlert
New Zealand Energy Corp. (TSX VENTURE:NZ)(OTCQX:NZERF) is pleased to announce
that the Company and its wholly-owned subsidiary, NZEC Wairoa Limited
(collectively "NZEC"), have entered into a binding agreement with Westech Energy
New Zealand ("Westech"), a wholly-owned subsidiary of Energy Corporation of
America. Pursuant to the terms of the agreement, NZEC will enter into a joint
venture agreement with Westech whereby NZEC can acquire 80% ownership and become
the operator of Petroleum Exploration Permit 38346, covering 267,862 acres
(1,084 km2) in the East Coast Basin of New Zealand's north island.
In consideration for the transfer of the 80% interest, NZEC will immediately
assume 100% responsibility for the permit and completion of the related work
program and will pay Westech US$725,000. Upon completion of the related work
program, Westech will refund US$225,000 to NZEC and all future expenditures for
the permit will be funded 80% by NZEC and 20% by Westech. Transfer of the 80%
ownership and operatorship of the permit, formation of the joint venture, and
proposed amendments to the work program are subject to approval by New Zealand
Petroleum & Minerals.
The proposed work program requires NZEC to complete various technical studies,
reinterpret existing seismic data, shoot and interpret additional 2D seismic,
and drill two exploration wells by March 2016. NZEC has the option to withdraw
from the joint venture after drilling the first exploration well, in which case
it would transfer ownership and operatorship of the permit back to Westech.
"With PEP 38346 in our portfolio, NZEC will hold more than 2 million net acres
(including pending permits) in the East Coast Basin from which to unlock the
potential of New Zealand's oil shale formations," said John Proust, Chief
Executive Officer and Director of NZEC. Ian Brown, NZEC's Chief Operating
Officer, added, "This is a property that NZEC's technical team knows well from
previous consulting work in the area, and we have an excellent relationship with
the local community. NZEC looks forward to working with Westech to advance this
exciting exploration opportunity."
On behalf of the Board of Directors
John Proust, Chief Executive Officer & Director
About New Zealand Energy Corp.
NZEC is an oil and natural gas company engaged in the production, development
and exploration of petroleum and natural gas assets in New Zealand. NZEC's
property portfolio collectively covers approximately 2.25 million acres
(including pending permits) of conventional and unconventional prospects in the
Taranaki Basin and East Coast Basin of New Zealand's North Island. The Company's
management team has extensive experience exploring and developing oil and
natural gas fields in New Zealand and Canada, and takes a multi-disciplinary
approach to value creation with a track record of successful discoveries. NZEC
plans to add shareholder value by executing a technically disciplined
exploration and development program focused on the onshore and offshore oil and
natural gas resources in the politically and fiscally stable country of New
Zealand. NZEC is listed on the TSX Venture Exchange under the symbol NZ and on
the OTCQX International under the symbol NZERF. More information is available at
www.newzealandenergy.com or by emailing info@newzealandenergy.com.
futr
New Zealand Energy Operational Update and Filing of Third Quarter Financial Results
http://ih.advfn.com/p.php?pid=nmona&article=55256336&symbol=NZ
futr
good post on stockhouse on nzerf
Waihapa0
11/28/2012 8:38:00 PM | | 196 reads | Post #31836905 Rate thisclarity
5 clarity : 5
Rate this:
This company is not a one well wonder. The land position is worth more than the trading price. All the market cares about is BBL/day, yet where does the future BBL come from...it has to come from the scientists ability to define high probability drilling targets using 2D or 3D seismic. The inventory of targets this company has is impressive, it had to be, otherwise why did the in country team of geoscientists sell a 26 year old company for shares in nz energy? They know what everyone else is figuring out, the volcano has created a insane number of conditions geologically that have all the right attributes for exploration. this is exploration, meaning stepping into the unknown, taking risks, reaping the rewards for the patient ones. At these stock prices you get the East coast basin for nearly free, the Taranaki Basin is much less risky as there is ample geologic data and drilling data to plan from. east coast shales are much less established, but any economic discover in that area will float all boats, meaning regardless of who hits success first...everybody with land near east coast benefits. 2013 will be a major year for this exploration company,once the waihapa is in their possession they will have their own little ATM machine to print money from the sales infrastructure plugged into Omaha tank farm etc. Waihapa comes with ready-to-drill drill pads...26 high profile targets...this fast tracks a ton of time and the well log data gives the exploration team a cheat sheet to do uphold completions on whichever wells are included in this origin deal.The only caveat is its NZ which means much of the technology and manpower for specialty technologies is from other regions like western Canada...this means sometimes delays as scheduling certain companies or expertise requires waiting for the right time of the year to get what you want. Canada is very busy in nov-mar certain technologies are more apt to be used in NZ after march or during breakup in Canada. The upside of NZ is its a new frontier in a stable part of the world. any discoveries will be easy to market...40 API oil is very easy to find a buyer for. In Canada the Bakken created believers out of non-believers, and I think the Shale technologies learned in the Bakken will be deployed in New Zealand by 2013. This company is sitting on the shale plays of a lifetime, the thickness of the east coast shales are mouthwatering. go to nz govt website, you will see everybody, and their dog has been snapping up exploration permits...WHY? They see compelling targets on preliminary seismic, the reservoirs have thickness to die for, permeability to allow for economic flow rates and porosity that suggests Bakken like attributes. If you wait for safety in this stock I think you will miss the boat,
It would take considerable time to permit, build, connect 49 kilometers of pipelines, construct and fix the bugs in a 25,000bbl oil facility and besides time, cost, the advantage is strategy. NZ Energy gets oil, gas, water handling that nobody else has. Waihapa Production Station may be small by some standards but it's a major deal to an outfit the size of NZ Energy. No cash from natural gas has been realized from 2012 wells, but once Waihapa is a done deal, that will change. These shallow moki wells are not huge producers, but keep in mind, until they get control of Waihapa they are paying to truck any oil, or store it in Tanks. This cost shrinks big time when they get their own facility. The operator from origin who ran the facility is changing coveralls from origin to nz energy so they won't have issues in transition as the deal finalizes. This plant is spitting distance from a Discovery Well in 2006 that tapped the Tikorangi...much deeper than the moki, under extreme pressures but produced near $300,000/day back then. If any of the "midstream assets" include prospects next door to this facility at Waihapa then you have potential for multiple stacked zones in the same well that are in close proximity to the production station that links to the markets. This kind of production could self-finance new wells in rather short time frames. The "Strategic Acquistion as they called it, suggests well log data from 27 wells, some of these wells I would speculate could be duds in the lower formations but be commercially productive uphole in shallower formations. If they only need run in and complete them the cost would be a fraction of drilling, so these 27 wells are worth factoring in to the equation of what the potential growth is next couple years. I think I suggested in an earlier post a large number of established drill pads come with the 4 licenses with the Acquisition, it was suggested 16 of these pads are ready to drill on...the number A million per pad, was thrown around as a number it would cost to get permits, access, and excavate as ready to go. So there is some serious value to this transaction, but even if it goes through as planned, the stock will likely not see big moves until the BBL/Day numbers reach the magic number for conservative analysts to jump in with institutional money. I think this company has a good story, a good team, but more important the right attributes for a future home run, or several.The tough part is explaining the esoteric parts of why the geology, geophysics and reservoir numbers for the land position are so compelling to public folks who want simplicity or certainty in a world that just ain't, so that is why the early adopters of this stock seem to be knowledgeable or more accepting of the Exploration aspect of this company.I titled this post why Waihapa is a game changer, I am referring to both the saving of money, the making of money, the long term strategy and the assets that fast track new oil production for this company. Time will tell but, as the benefits of the Aquisition are digested by the various followers of this stock, it should become apparent that the future lies in translating 3D seismic leads into barrels per day via Waihapa Production Station. The reserves can only go up with an inventory of new targets, and with the size of land position now held 1.8 Million Acres in east coast and 170,649 in Taranaki, you get this today for less than a coffee, it's a bargain that won't last when the $42Million Transaction is completed
Lot of shares changing hands here-
At this point I'm a bit miffed.
Guess the next couple of weeks should tell the story.
futr
Expert Analysis
David Phung, Credit Suisse (11/26/12) "New Zealand Energy Corp. announced a successful well at Waitapu-2. . .the company currently plans to flow test this well for roughly two weeks before conducting a pressure build up. Based on initial results, Waitapu-2 could realize a stabilized rate of approximately 300 bbl/day once artificial lift is installed. . .New Zealand Energy continues to progress its drilling program to achieve its objective of 3 Mboe/day by the end of Q1/13. . .we remain relatively optimistic of future exploration results; we currently maintain our Outperform rating and target price of CA$2.75."
Bill Newman, Mackie Research Capital (11/26/12) "New Zealand Energy Corp.'s Waitapu-2 exploration well is currently flowing at a rate of 325 bbl/day of 40° API oil plus 0.8 MMcf/day of natural gas through a 24/64" choke. . .the company continues to target a production rate of 3 MMboe/day by the end of Q1/13. The successful Waitapu-2 exploration well, plus the potential from the Arakamu-2, Arakamu-1A and four additional wells should help New Zealand Energy to achieve this ambitious target—if achieved, we expect the company to generate over $60M of cash flow in 2013. . .we maintain our Buy recommendation and $3.90 target."
New Zealand Energy Announces New Oil Discovery
PrintAlert
New Zealand Energy Corp. (TSX VENTURE:NZ)(OTCQX:NZERF) ("NZEC" or the "Company") today announced that the Company has made its fifth oil discovery in the Taranaki Basin of New Zealand's North Island.
The Waitapu-2 well was drilled to a total measured depth of 2,085 metres, encountering approximately 6.2 metres of net pay in the Mt. Messenger Formation, a thick sequence of turbidite sandstones in New Zealand's Taranaki Basin. The Waitapu-2 well is currently flowing at a rate of 325 barrels of oil per day and 800 thousand cubic feet of natural gas per day through a 24/64th inch choke. The well is producing sweet, high-quality 40 degrees API oil that is being trucked to the Shell-operated Omata Tank Farm, approximately 45 km north of the site, and sold at Brent pricing. To date the Waitapu-2 well has produced 1,880 barrels of oil. The well will be flowed for approximately two weeks and then shut-in for pressure build-up. Subject to assessment of ongoing production, a decision will be made to lay 1.3 kilometres of new pipeline to tie-in to the Waihapa Production Station through the existing Copper Moki pipeline.
"The fact that the Waitapu-2 well is flowing from natural reservoir pressure, as the Copper Moki wells did, further confirms NZEC's geological model," said Bruce McIntyre, Executive Director of NZEC. "Most Mt. Messenger wells in the region have required artificial lift almost immediately. We are continuing to refine our geological model based on drilling success to date and interpretation of the recently completed 3D seismic survey, and have many more prospects to drill that we feel are comparable to the Copper Moki and Waitapu discoveries."
The Company's first well drilled at the Waitapu site, the Waitapu-1 well, was drilled to a measured depth of 2,213 metres, then cased and completed across a gross interval of 30 metres in the Mt. Messenger Formation. While a significant sand interval was identified with oil and natural gas shows, the permeability and porosity was such that the well did not yield economic production. The well has been suspended pending further evaluation and/or sidetrack to an alternate target.
NZEC has reached target depth on the third well in its current eight-well program. The Arakamu-2 well, NZEC's first well at the Arakamu site, has reached target depth at a measured depth of 2,380 metres. NZEC has commenced casing the well, with completion to follow. The well encountered 8.1 metres of net pay in two potentially productive zones in the Mt. Messenger Formation. The lower zone will be completed first with the second zone to follow. The Company will announce results from the Arakamu-2 well once testing has yielded enough information for the Company to estimate the well's productive potential, with testing expected to commence in late November. Following completion of the Arakamu-2 well, NZEC will move the rig to spud Arakamu-1A, which is targeting the deeper Moki formation.
NZEC will drill four more wells after Arakamu-1A with the objective of completing its eight-well program and increasing production to 3,000 boe/d(1) by the end of Q1-2013.
NZEC will report its third quarter financial results on November 30, 2012, including a full update on exploration activities and the results of production optimization of the three Copper Moki wells, which are now producing under artificial lift.
On behalf of the Board of Directors
Bruce McIntyre, Executive Director
About New Zealand Energy Corp.
NZEC is an oil and natural gas company engaged in the production, development and exploration of petroleum and natural gas assets in New Zealand. NZEC's property portfolio collectively covers approximately 2.25 million acres (including pending permits) of conventional and unconventional prospects in the Taranaki Basin and East Coast Basin of New Zealand's North Island. The Company's management team has extensive experience exploring and developing oil and natural gas fields in New Zealand and Canada, and takes a multi-disciplinary approach to value creation with a track record of successful discoveries. NZEC plans to add shareholder value by executing a technically disciplined exploration and development program focused on the onshore and offshore oil and natural gas resources in the politically and fiscally stable country of New Zealand. NZEC is listed on the TSX Venture Exchange under the symbol "NZ" and on the OTCQX International under the symbol "NZERF". More information is available at www.newzealandenergy.com or by emailing info@newzealandenergy.com.
futr
nice article on nz
http://www.grahamanalytics.com/CompanyFiles/NZEC/kapuni.html
VP Rhylin Bailie Interview
NZEC VP Rhylin Bailie gave an update on the status of the company in an interview with Al Korelin: Watch the NZEC interview here
Good Coverage here-
What a buying opportunity yet again-
http://www.theenergyreport.com/pub/co/3614#quote
futr
Bill Newman, Mackie Research Capital (10/24/12) "New Zealand Energy Corp. released the results of an independent reserves report effective September 30, 2012. Since year-end 2011, estimated proven reserves increased by 232%. . .the before tax NPV discounted at 10% increased by 73% to $20.8M. . .the eight-well drilling program currently underway has the potential to add significant additional reserves before year-end. . .we maintain our Buy recommendation and $3.90 target price on the company's large land base in the Taranaki Basin which provides conventional growth opportunities and large land positional in the East Coast Basin that has both conventional and unconventional resource upside."
David Phung, Credit Suisse (10/24/12) "New Zealand Energy Corp. provided an interim reserves report that includes the first three Copper Moki wells. . .on a 2P oil equivalent basis, reserves have grown by 150% to 706 Mboe, net of production since 2011A. Before tax NAV10 has increased to ~C$21M, which is an approximate increase of 73%. . .we believe the company remains a bright light among international jurisdictions for oil and gas exploration, but relatively remains underexplored. . .New Zealand Energy looks to benefit here from its relatively large land base; we currently maintain our Outperform rating and target price of CA$2.75."
Followers
|
12
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
245
|
Created
|
09/02/11
|
Type
|
Free
|
Moderators |
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |