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Sorry for the late reply. I was not familiar with Pantheon. I listened to most of the 2 hr podcast they had on their recent results. Never seen a company put out such a long explanation. Obviously at 500+million market cap, this is not a small company. They obviously have some big money betting that they are right and they can bring in substantial production from the North Slope. The chart is very good since you asked about the stock. Hope you have some.
The issue that they spent hours explaining is why they hit so much gas in their latest test well. Obviously they are very sensitive to the topic otherwise they wouldn't have spent two hours going over and over it. This worries me. Any time a company has to spend so much time explaining an issue, it's obviously a worry for the markets. The North Slope is far away from user markets. Lots of ngas is NOT what they are looking for. They want light sweet crude that can fill up a mostly empty Trans Alaska Pipeline. They emphasized over and over again how close they are to the Pipeline and the Dawson Highway. So IF they can drill multiple wells and IF it's a high percentage of light sweet crude, this is a big project in a world that doesn't have many places to go besides the Permian Basin.
The cost of the wells is in the high teens of millions so this isn't going to be cheap drilling. They fracked the test well so they need service companies and infrastructure that probably isn't there. Of course if they got a big oil company to jv with them, the service companies would probably spend the time and capital to go up to the North Slope with equipment and source the sand and water.
If you look at the 1 yr chart, the market has been selling this project off. The peak price for the stock was $1.99 in early 2022 so the market cap was US$1.5 billion! versus US$500+million now. So it's not a slam dunk.
I worry about the oil/gas mix, the remote location and the need for big money to step in. I didn't hear that they intend to develop this project themselves. I think they spent all that time on the podcast because they need to convince some deep pockets that this will work. They do have 100% of these projects so that's great. They do have room to give a JV partner a significant share and still retain a decent share for themselves. I am not that familiar with the players that already are working in the North Slope so don't know who their target JV partner might be. Is the project big enough for a new player to step in? Probably. They are talking hundreds of millions of barrels.
For me, this is already fairly expensive and the market isn't terribly enthusiastic about the project. The shares have been positive this year and I do think we need more oil for the intermediate term. World use of oil isn't going away soon enough and yet big oil is paying dividends rather than spending money to look for new oil. Personally I would pass but it could turn out to be a big project but it's probably a few years away and I'm too old to wait! LOL! Good luck and again sorry for the delay in response.
Hey Bobwins
Are you familiar with
PTHRF. a test well in
North slope near Prudhoe Bay
Any of you guys look at PTHRF ?
Alaskan Notrh Slope Alkaid 2 well
located off Dalton Hgwy 20 miles south
of Prudhoe Bay. 500+ bpd test well flowing despite sand
blockage.
Pick 4 Contest # 17 Deadline Just a little over 6 Hours Away
Remember to get your picks in before Today's Close. Below is the link to the board.
https://investorshub.advfn.com/Pick-4-Contest-No-17-41659
Pick 4 Contest # 17 Deadline Friday
Remember to get your picks in before Friday's Close. Below is the link to the board.
https://investorshub.advfn.com/Pick-4-Contest-No-17-41659
PTRUF/PRQ.TO US$1.77
Petrus Energy is a Canadian energy company. I like this one because of the financial results so far, projections for next year AND the mgmt.
Petrus changed mgmt in 2021. Ken Gray took over as CEO. They wanted to increase production but their bank was not helpful so they refinanced their debt. Ken and his brothers put in a tremendous amount of equity resulting in 74% insider ownership. In addition one of the brothers loaned the company $25million for three years in a second lien position to the bank that provides Petrus with a revolving line of credit. In addition to the tremendous equity contribution, Don Gray is the largest shareholder and Chairman, holding 34% of the common shares. Don Gray is also founder and CEO of Peyto,. a natural gas producer that started out as a penny stock and is now a 2.2 billion dollar major in Canadian natural gas production.
Petrus has 122 million shares outstanding.
In the latest Q3 report, Petrus averaged 6,639boepd at 71% gas and 29% liquids. Petrus is projecting exiting 2022 at 10,500boepd.
Guiding for $130-135million capex in 2023 allowing the company to average 13,000 to 13,500boepd. That should result in a 75% increase in production in 2023 as well as a 65% increase in cashflow to C$140-150million depending on commodity prices.
Petrus's main production comes from the Ferrier fields in Alberta. In addition to substantial acreage, Petrus owns the processing facilities for their production.
Petrus has low debt of C$48million. In addition to Ferrier they have substantial acreage positions in Thorsby and Foothills with steady, low decline production. They also have drilling sites in Kakwa which are oil heavy and represent future growth. Petrus focuses on high payback wells that payoff drilling costs within 6 months. They are a leader in this drilling metric.
Petrus is already a success story, starting with an C$.81 share price a year ago vs C$2.44 now. 52week hi was c$3.42. I missed this stock in 2021 but with a double in production coming in 2023, this should still take off.
The change in lending and decrease in debt allowed Petrus to rapidly expand production.
TRLEF/TCF.CN +.03 to .3812
Nice pop today. Apparently yesterday was the last day for warrant holders to exercise on a certain set of warrants. Trillion announced an accelerated expiration in late October. So there was heavy selling yesterday as some warrant holders sold stock and signed up to exercise warrants.
Yesterday Trillion announced very good news. Their second well is coming online this week about two weeks after their first well was drilled successfully and came online. This second well is a recompletion. They fixed some bent tubing and perforated a new sand measuring 7 meters. The new sand performed so well in the testing that they decided to just put the new sand on production and go back and perforate the original sands when production drops off.
The recompletion should flow similar volumes to the first well, resulting in about 3MMCFPD net to Trillion from the two wells. Remember Trillion is getting $31/mcf for this gas. 3MMCFPD @$31/mcf = $2.79 million dollars per month gross revenues to Trillion. The pipelines and onshore processing plant are already there and operating. The field has been producing for over 10 years so all the infrastructure is there and already paid for. The onshore gas plant can process up to 75 MMCFPD. Trillion projects a new well will be drilled, completed and producing every 45 days. The next well should come online around early January 2023.
TRLEF -.0079 to US$.35
down on good news?? Oil down so this goes down too. Doesn't matter. This new well is another paycheck that will happen every month. First check in December!
Trillion owns 49% of the output so if they run it at 3MMCFPD, Trillion will get 1.5MMCFPD @ $31/mcf!
TRILLION ENERGY ANNOUNCES FLOW TEST RESULTS FOR AKCAKOCA-3 WELLAkcakoca-3 Well Successfully Tested at a Rate of 7.0 MMcf/day
GLOBENEWSWIRE 7:00 AM ET 11/21/2022
Vancouver, B.C. , Nov. 21, 2022 (GLOBE NEWSWIRE) -- Trillion Energy International Inc.(TRLEF)(“Trillion” or the “Company”) (CSE: TCF) is pleased to announce flow test results for the Akcakoca-3 natural gas well at the SASB gas field, offshore Turkey.
Three sands with a total of 34 metres of natural gas pay were identified for perforation in the Akcakoca-3 well. Upon the first perforation of the upper 7 metre sand occurring, the well immediately experienced a pressure buildup up to 7.0 MMcf/d (32/64” choke). Well head pressure measured 1,400 psi.
Based on initial gas flow and reservoir pressure data from perforation of the first sand, a decision was made to commence producing this zone and perforate the remaining two sands (totaling 27 metres) at a future date, after production from the initial perforated interval starts to decline.
The final production flow rate will ultimately be established at the process facility.
Arthur Halleran CEO of Trillion stated:
“We are very pleased that our multi-well drilling program is off to a very strong start. We are “Two for Two” so far with both South Akcakoca-2 and Akcakoca-3 wells now successfully producing gas. Each well additionally has 10s of metres of identified gas sands ready for perforation and production in the future to keep production levels up. This is a desirable situation for the Company to be in.”
About the Company
Trillion Energy (TRLEF) is focused on natural gas production for Europe and Türkiye with natural gas assets in Türkiye and Bulgaria. The Company is 49% owner of the SASB natural gas field, one of the Black Sea’s first and largest-scale natural gas development projects; a 19.6% (except three wells with 9.8%) interest in the Cendere oil field; and in Bulgaria, the Vranino 1-11 block, a prospective unconventional natural gas property. More information may be found on www.sedar.com, and our website.
Contact
Art Halleran: 1-250-996-4211
Corporate offices: 1-778-819-1585
e-mail: info@trillionenergy.com
Website: www.trillionenergy.com
Cautionary Statement Regarding Forward -Looking Statements
This news release may contain certain forward-looking information and statements, including without limitation, statements pertaining to the Company's ability to obtain regul a tory a pproval of the executive officer and director appointments . All statements included herein, other than statements of historical fact, are forward-looking information and such information involves various risks and uncertainties. Trillion does not undertake to update any forward-looking information except in accordance with applicable securities laws.
These statements are not guaranteeing of future performance and are subject to certain risks, uncertainties, and assumptions that are difficult to predict. Accordingly, actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. These factors include unforeseen securities regulatory challenges, COVID, oil and gas price fluctuations, operational and geological risks, the ability of the Company to raise necessary funds for development; the outcome of commercial negotiations; changes in technical or operating conditions; the cost of extracting gas and oil may be too costly so that it is uneconomic and not profitable to do so and other factors discussed from time to time in the Company’s filings on www.sedar.com, including the most recently filed Annual Report on Form 20-F and subsequent filings for the first quarter of 2022. For a full summary of our oil and gas reserves information for Turkey, please refer to our Forms F-1,2,3 51-101 filed on www.sedar.com, and or request a copy of our reserves report effective December 31, 2021 and our Prospective Resource report effective October 31, 2021.
Source: Trillion Energy International Inc.(TRLEF)
2022 GlobeNewswire, Inc.
Research Capital reiterated their buy recommend on Trillion Energy and their price target of US$1.35. Report shows projected cashflows and projects 1.35 as a reasonable 3X cashflow.
https://mcusercontent.com/5e269838a16742a97c90596c2/files/9ddac5b5-85ab-85d2-e245-5bb6978631ae/TCF_11_14_22.pdf
REI $3.09
The more I look, the more I like. Ring Energy completed their purchase of the private oil company in August and so included results of only one month of the combined companies. Production increased from 10K to 13K. In Q4, with all three months from both companies, Production will jump to 18K to 19K.
Ring operates in areas of the Permian that are not shale. They drill horizontal wells and frack but at much lower levels than in the true shale. Their land already has oil porosity. The fracking helps but isn't as necessary to get oil to flow. This leads to slower declines in production over the life of the well AND allows the company to apply secondary and tertiary methods to squeeze additional barrels out of the ground. So the life of these wells in the 30 to 50 year range of economic production. Offsetting these positives is the fact that these are not big wells. The initial production levels are in the 300-700bpd range. It takes a lot of wells to boost company wide production.
Like most US oil producers, Ring is not seeking production at all costs. They seek positive free cashflow, paying for all new drilling out of profits AND still having cashflow in excess of capex. Their most recent guidance is for 2023 production slightly higher than Q4 guidance of 18-19K. They also have to pay down debt from the acquisition that just closed. Their line of credit has $100+million plus in excess credit limit and given they are at a free cashflow level, this should be an adequate cushion. Company goal is to reduce outstandings next year from excess cashflow.
Ring is almost a pure play on oil. The level of liquids in their production in the 90+% range, counting oil + NGL. I think ngas pipelines in Texas will reach capacity soon and that will limit oil production since flaring is no longer allowed. Ring should have less problem with excess ngas production.
The oil porosity and the lack of need to frack as much leads to low cost oil wells. Ring has an extremely low cost of break even. Their break even is in the $25 to $30 range. This also leads to quicker drill times and completions. Wells can be drilled and turned to production in less than two weeks.
In addition to these cheaper horizontal wells, Ring also has hundreds of cheap vertical wells. The average production of these wells is in the 150bpd range. Again, not going to attract headline news but contributes to the company's low break even levels and long life assets.
Bottom line, I think Ring Energy will substantially increase net profits and cashflow in Q4 as production rises from 13K to 18K. They are very cost conscious and operating in areas that provide low cost, high return opportunities. The mgmt team founded Arena Resources and took that stock from nothing to a big cashout.
LEU +.42 to 39.87
LEU was cruising in the mid forties until they announced Q3 earnings. Big drop in revs and profits so stock crashed to around $30 on Nov 9th.
I bought more at $35, 35.17 and 31.50 on the way down. LEU is the only licensed supplier of HALEU in the US. HALEU is projected to be the version of fuel for advanced design reactors going forward, including most of the new Small Modular Reactors(SMR) that are on the drawing board.
Then Thursday the price started recovering based on an announcement out of the Dept of Energy.
https://finance.yahoo.com/news/u-centrus-energy-pact-next-165950899.html
LEU and Dept of Energy will share the $150million dollar cost to produce a limited amount of HALEU at the Centrus plant. This subsidy is obviously designed to encourage US based production of the fuel for the future and allow LEU to get ready for regular production in the future to fuel the US based nuclear plants.
RING ENERGY REI, -.12 to 3.08
Ring Energy is a Permian explorer and producer. They recently closed the purchase of a private energy company with wells and land in the Permian. Q3 results included 1 month of combined company.
Q3 they earned 1.09eps but that included a large derivative profit from hedging of $42million. After eliminating hedging, adjusted net was similar to Q2 of .28eps.
Assuming they can maintain .28eps, they are trading for around fwd p/e of 3.
They are guiding for 2023 production of ~18,000 boepd versus 13,000boepd they produced in Q3. I expect improved results from the gradual expansion of production as the new year unfolds. +~35% seems reasonable.
.28 X 4 = 1.12 fwd eps. X 1.35= 1.51 fwd eps or about a 2 fwd p/e.
Opened a small position. Investors may be spooked by share issuance to fund purchase and waiting to see how combined company performs. Also the private company owners could sell REI to cash out and cause near term share price weakness.
https://finance.yahoo.com/news/ring-energy-announces-record-results-222600475.html
TRLEF/TCF.cn +.0289 to US$.365
Gas if flowing. Trillion turned on their first SASB well and it's flowing about 3MMCFPD. Operator is monitoring and will likely increase it over time to 3.5 to 5 MMCFPD range.
2nd well is a recompletion. Well had bent tubing that prevented full production. Installed bigger tubing, fished old wiring out of hole and preparing to perforate well this week. Should turn to gas production by this time next week. Expect similar production to AK-2.
First paycheck should be mid December at $31/mcf! Trillion's partner and well operator is the national energy company of Turkey. Trillion has 49% interest in SASB field.
This is my biggest position. Company is guiding for 17 wells to be completed in the next two years. Expects each well to take approximately 45 days from spud to production. Has funds in hand to complete first 7 wells. Expects cashflow from these initial wells to pay for remaining 10. After the first 17 wells, Trillion will explore several prospect sites that have similar characteristics to SASB field where the first 17 wells are located. Onshore production facility can accomodate up to 75 MMCPD and can be expanded. Likely won't need expansion for this initial production phase of 17 wells. If they average 3 to 5 MMCFPD, that will total 51 to 85MMCFPD.
TRLEF -.0144 to .3156
Trillion Energy down a bit today on pretty good news. Total depth and testing in the next few days. I've seen some pretty good pre testing PR's that turned to dust but overall the drilling has gone as planned and on time and on budget is a good start to a good well. We'll find out in the next couple of weeks. After that, very quick turnaround to production and cash because of existing undersea pipelines and onshore processing facility.
https://finance.yahoo.com/news/trillion-energy-announces-td-logging-130000476.html
VET 23.18
Vermillion has had a big drop since hitting a peak of over US$30 a couple of months ago. Part was due to falling oil prices, hitting an interim peak of $122 in June and falling to below $80 in Sept. VET fell to a low of 18.41 in late September before rallying recently to today's price. One factor in the share price decline is the excess profits tax in Europe. VET gets most of its free cashflow from it's European natural gas production. Prices in Europe have been crazy high and VET has about 10Kbpoed production from natural gas. They are due to increase their share of the offshore Corrib field production late this year or early next when their purchase of additional interest from a jv partner is completed.
The tax will likely take a 25% bite out of VET's free cashflow. Still a very profitable company with increasing ngas production in Europe. They have production in Canada, US and Europe and should fare well in the next few years.
Trillion Energy TRLEF/TCF.cn +.02 to US$.3485 Trillion has been moving up lately as they finally have a drill bit working. No results, although the first well is a recompletion of a previously drilled hole. Should be low risk but they need these first two wells to produce as advertised to avoid a collapse in price. Lots of optimism built into share price.
There are positive reasons for optimism. Offshore drill platforms are already built and in place. 5, I think. The first 17 wells are very low risk due to previous drilling and testing. They were just never produced in a much lower ngas price environment. In addition, Trillion has pipelines already in place to an onshore facility with 75mmcfd capacity. So they drill, complete and almost immediately can produce ngas. That doesn't happen normally. Also their prices are locked in at US$30/mcf. Not Turkish Lira. Which is excellent because Turkey is experiencing 80% inflation. Don't want to be holding Turkish currency.
There are definitely risks due to Black Sea location, Turkey country risk and the normal offshore production issues. But in addition to the first 17 wells, Trillion holds rights to several exploration locations that could be huge. The plan is to use the first 17 wells cashflow to explore nearby locations from the existing platforms.
First well scheduled to be drilled, completed and producing by November. Short wait to find out if they can deliver.
SQZ I have been adding here and there. Biggest downside risk is dry hole on the Eigg drilling underway but the company is cheap regardless based on FCF.
If you don't read Alexander Stahel you should
https://twitter.com/BurggrabenH?t=G9ztsoz9E0OaQy3-HMK2CA&s=09
CTRA $28.78
I have been holding SD for exposure to ngas in the US. Been disappointed in relatively poor performance, in spite of generally strong ngas prices. So bought some Coterra Energy on Friday to see if a different horse can help me.
Coterra is 50/50 oil gas. They have exposure to Permian, Marcellus and Anadarko basins. They are relatively big cap at 22 billion vs only 700 million for SD. They have big acreage and reserves. While I was looking for primarily ngas exposure, I like the 50/50 balance of their production and the cheap production costs in the Marcellus for ngas. Coterra has a low p/e of 7 vs 3 for SD. I think market likes strong margins at CTRA AND growth in production.
SD has been maintaining production by opening shut in wells from the prior price collapse of a few years ago. As a result, they have very low capex requirements and NO HEDGES! So I love the free cashflow but apparently the market does not. So even though I will stubbornly hold SD, I wanted to try a bigger cap energy stock to see if I can capture what I think will be an energy bull market going forward.
market will want to see production and $$ flowing before they reward Trillion stock price. November will seem like a long way off in the distance. And that's assuming no glitches, which are entirely possible on the first well. Stock is up a little today at .358 but off recent highs.
Trillion Energy's SASB Natural Gas Drilling Program Begins
The Company has started its multi-well development program at SASB targeting much needed natural gas in times of scarcity and record high prices
September 19, 2022 - Vancouver, B.C. - Trillion Energy International Inc. (“Trillion” or the “Company”)(CSE: TCF) (OTCQB: TRLEF) (Frankfurt: Z62) is pleased to have commenced its multi-well drilling program on the SASB natural gas field, upon successful arrival of the Uranus Rig which was mobilized last week after delays due to maintenance and weather conditions in the Black Sea.
The Uranus Rig is situated at the Akçakoca platform where the first wells are being drilled. A total of three directional wells will be drilled from the Akçakoca platform, plus one recompletion of an existing well will occur. The Company estimates the four operations will be completed within 6 months.
The Company planned to pair completion of the Akçakoca wells to reduce cost and rig skid times, but each well will produce gas upon completion and sold to market. First gas production is expected early November 2022.
After the work at the Akçakoca platform, the Uranus rig will move to the next of the three platforms at SASB to continue the work program. The Company has plans to drill/complete these initial 7 wells followed by another estimated 10 wells prior to further exploration occurring.
Arthur Halleran, CEO, stated:
“The commencement of drilling operations marks a transformative step towards the Company’s bright future, with drilling to lock in much-needed locally sourced gas supplies for the winter months at prices over US$30/mcf. These long reach advanced engineering production wells will allow gas production to immediately be sold under our existing gas contract where we get paid monthly and can then use the revenues to continue to drill new wells.”
The Company’s development program initially includes seven production wells coming online during a time when acute natural gas shortages are menacing Europe and Turkiye. Drilling of additional 10 targets are expected to follow. Natural gas prices continue to spike, breaking historical records as the prospect of a cold winter looms with the worst shortages expected yet to come.
Trillion Energy is an international gas and oil producer. The Company has a simple clear strategy to add value to shareholders by developing extremely profitable proven non-produced gas reserves on the SASB gas field through existing infrastructure and facilities commencing 2022.
Visit our website
For Investor inquiries please email:
info@trillionenergy.com
Director & CEO
Arthur Halleran
+1 (250) 996-4211
Corparate Offices
+1 (778) 819-1585
Admin Office (Canada)
Suite 700-838 West Hastings St.
Vancouver, BC V6C 0A6 Canada
Operations (Turkey)
Turan Gunes Bulvari, Park Oran Ofis Plaza
180-y, Daire:45, Kat:14, 06450
Oran, Cankaya, Ankara, Turkey
Should You Invest in Silver as an Inflation Hedge?
Silver can help diversify an investment portfolio, but as an inflation hedge it's had mixed results.
https://money.usnews.com/investing/investing-101/articles/how-to-invest-in-silver #Silver #inflation
Trillion Energy TRLEF .3898
Finally Drillship Uranus is at the site. Should start drilling in the next few days. These are not exploratory wells. The wells have been drilled and tested previously. The platforms and undersea piples are in place, as is the onshore processing facility. Trillion will drill new wells because of the time since they were drilled but should be very low risk drilling.
Here is a research report forecasting target price of C$1.35 after full production in 2023.
https://mcusercontent.com/5e269838a16742a97c90596c2/files/5ff37a7a-e306-edc6-3a9d-7edc27742f48/TCF_09_13_22.pdf
On their website, they said news in October! Hope it’s good news! US$ is hurting us a bit on Serica
SQZ From what I have read it sounds like the windfall profit tax is going away with this price cap and the UK government is just going to pay the difference.
I have a hard time seeing how the price cap doesn't add incremental demand.
I am eager to hear news on the Eigg drilling that spud back in July
Serica, SQZ..L still sliding a bit. Down to 3.6550 from 3.73 yesterday.
Russians have shut off gas to Europe but apparently investors think problem will be solved by price controls and storage approaching 90% full. I don't think so.
TRLEF +11.76% to US$.3676
Trillion Energy is still saying they will start drilling any day but rig is stuck in port doing some repairs. Rig owner is on the hook for daily penalties since rig wasn't on site on 9/1 but Trillion just needs the rig so they can start drilling and prove their previously drilled holes can produce ngas.
https://finance.yahoo.com/news/trillion-energy-receives-47-natural-130000211.html
This PR is the cause of today's bump. Raising ngas prices to only $30/mcf.
Now all they need is some gas~!~~! They say 40 days to first gas from date of spud. Let's see how long it takes to get the rig on site and drilling. It's been a struggle with delays upon delays. Such is the life of a microcap in a turbulent world.
SQZ.L -.50 to 3.73 GBP
Bought a few more Serica today at 3.735. Russians will likely turn Nord1 back on but just barely. They want to squeeze Europeans coming into winter. Lots of talk about govt capping the price of oil and gas. Might work short term and of course, they will print more money to finance it. Since European Union loves central control, they will establish a big commission to govern it but it won't fix the underlying problem.
Serica is printing money and should be fine even if there are caps installed.
VET +2.8% to US$30.01
One thing I read about VET that encourages me is their hedging. I normally hate hedging because it ensures cashflow but typically takes away upside.
But the prices in Europe for ngas are unsustainable. Who can afford $400/barrel oil/ngas???
So VET has hedges that were required for the Corrib purchase. The hedges will likely fall off as most of the purchase price is going to be eliminated by the time the deal closes. VET gets to deduct the profits from 1/22 until the deal closes so instead of paying $600 million, they will likely owe 150million at closing! What a steal!
Anyway VET is putting on hedges now to ensure they get the elevated pricing for awhile longer. One of these days, the floor is going to drop away but VET should be somewhat protected.
Has to be one of the best calls of the year in terms of precision and timing. Outstanding work.
VET: Great call Bob, Vermillion has been gaining some attention lately, their acquisition of Corrib will pay off in about a year and some hedges come off at the end of this year. They also have another huge land position in Europe, with nearly 2 million acres in their Central & Eastern Europe Pannonian formation play across Croatia, Hungary, and Slovakia, see Slide 32 of their August investor presentation:
https://www.vermilionenergy.com/invest-with-us/events--presentations.cfm
Hopefully the Ukraine situation can end peacefully soon, but Europe should learn about the dangers of their dependance on Russian energy and encourage further development of some of their own resources.
SPUT they're locking it up and throwing away the key. At some point that U308 will go to a productive use but not anytime soon.
I just can't tolerate buying equity on money burning operations or explorers. U308 price may go up or down but it sure isn't going to have a 50% or greater drawdown over the next 12-24mo. Same cannot be said for U companies that have zero FCF
uranium starting to percolate......
LEU +2.70 to 41.50
BSENF +.64 to .64
GLATF +.13 to 2.80
UUUU +.29 to 7.27
URNM +2.02 to 70.73
Congress is intent on rebuilding uranium production and enrichment for energy security. Govt money will flow into this sector over the next several years.
Completely with you on the uranium trade. Started buying about a year ago. Own DNN MGAFF ANLDF UEXCF FDCFF FCUUF. Continue to accumulate.
LEU +3.29 to $36.37 The only fundamentally sound play in Uranium took off today on a big earnings beat. Centrus beat earnings with 37.4 million in earnings on 99.1 million in total revs. EPS of $2.51.
This was WAY over Q2 2021 totals of 11.6 earnings on 62.4 million gross revs.
Also secured $135million in new orders bringing their book to $1billion.
Centrus is the ONLY US Nuclear Regulatory Commission licensed provider of HALEU( High Assay Low Enrichment Uranium) This is the future of nuclear fuel in the new reactors and Centrus is in the drivers seat in the US.
https://finance.yahoo.com/news/centrus-reports-second-quarter-2022-200500824.html
Overall uranium stocks have done well recently, moving up from 0 to 30+% since I bought mid June. LEU has done the best followed by UEC. Long term contracts tend to be negotiated and closed in the fall of each year as utilities review their needs and secure long term supplies of U308. Will this be the kickoff to another big U308 rally? I think so. Ukraine/Russia has exposed the vulnerability of the current/future energy systems. Without ngas as the bridge fuel, the new fangled solar/wind/EV revolution doesn't work. A new battery storage solution may be coming but it ain't here yet.
re SPUT
I understand the appeal of the physical stuff but don't get where the fund ends up. They state that they won't sell so what are they going to do with 50 million pounds of U308?
They have effectively soaked up the slack in the spot market, forcing spot prices up and basically taking away a source of U308 from the utilities that will eventually have to contract for the stuff at higher long term pricing.
Japan still appears to be the closest near term source of real demand. They had long term contracts for U308 and have periodically sold into the spot market, helping create the long term bear market. But if they speed up their revival of refurbished plants, they might impact near term contract pricing.
Of course China is building many new plants as well. But they will probably get their U308 cheap from their comrades, who will probably have a surplus.
Uranium - I have a decent position of Sprott Uranium Fund. At some point uranium is going to skyrocket and while these juniors that will never get into production will go ballistic I feel a lot more comfortable waiting in SPUT who won't have a dilutive financing and also doesn't face inflationary pressures.
Uranium: archived, as tidy valuable recap, as once it becomes a settled no-brainer prices may have already doubled.
I recently got interested in Uranium again. It blasted off in late 2020 without me. The U stocks faded this year so about a month ago I bought UUUU, URNM, UEC and LEU. I also bought smaller positions in GLATF and BSENF. I did so after reviewing a bunch of youtube videos presented the bull case for uranium. Obviously the war in Ukraine has turned a spotlight on energy and Uranium is becoming a pretty big part of the story.
Russia is a big supplier of uranium but probably more importantly is a major player in enrichment, turning the raw U308 into a usable fuel source.
I always thought it was kind of crazy to rely on Russia for this task but it worked for several decades. Unfortunately they did it so cheaply that the uranium enrichment industry in the US went away. France still relies on nuclear more than us so they still have enrichment capacity but not enough to totally replace Russia right now. Luckily the nuclear reactor utilities typically plan well in advance and have sufficient fuel supplies on hand for awhile.
But the resurgence of the US uranium industry is really going to happen. The existing players aren't really producers. They have mothballed projects that can be activated with money and time. I expect US producers to be subsidized at first. So here's why I bought the various stocks:
UUUU Energy Fuels has the only licensed plant in the US able to turn yellow cake into U308. The plant is currently being used to separate rare earths. They have survived the nuclear winter and the White Mesa plant ensures that they will be part of any nuclear renaissance in the US.
URNM is an etf with uranium stocks run by Sprott.
UEC has been collecting uranium assets for a long time. They have several uranium producing projects in mothballs waiting for the price of U308 to rise so they can profitably produce. They bought Uranium One and acquired several projects as well as 5 million pounds of U308. They are a billion dollar market cap player with no production! But they are well positioned with several ISR projects that can be restarted relatively easily.
LEU Centrus Energy is an active supplier to the worldwide nuclear power plant industry. They help design solutions for utilites and provide the potential for improved fuel rods for the industry. They actually have revenues! Their stock was hurt by the fact that they have contracts for enrichment with Russia and could be hurt by tough sanctions. But if there is a nuclear revival in the US and new, better fuel is part of it, it's hard to imagine LEU won't benefit.
GLATF Global Atomic is building a uranium mine in Africa. They are well into construction and will likely beat many of the restarts into production.
BSENF Baseload is further down the chain and is a true junior explorer. They are much small in market cap than the others on this list.
A secondary theme in Uranium stock revivals is that the whole clean energy revolution has turned up a big problem. Solar and wind are intermittent. They haven't been able to provide baseload power. Ask Germany if pouring billions into solar and wind has worked. In addition, whether they like it or not, nuclear emits no CO2. Yeah, we still have the spent fuel problem but this winter, Germans and Europeans will have a much bigger problem than theoretical arguments about spent fuel. They could freeze to death. Nuclear provides safe baseload power. That's why the Chinese are building 150 nuclear reactors. The Chinese are building traditional very large reactors. Another interesting part of the nuclear story is SMR. Small modular reactors could become very important to the mining industry as well as small remote towns and villages. These smaller reactors can theoretically be built in a more factory like manner and bring down costs and time to build. US plants can take 30 years to design and build. The first Western SMR is scheduled to be built and operating by 2027. Success here could invigorate the industry and open up much wider usage of SMR's.
VET Vermillion +1.42 to 21.53
energy stocks went up today. Russia has cutoff gas to Europe. Vermillion has onshore gas in the Netherlands and also produces gas offshore in the North Sea.
They are diversified with oil production in Canada as well. Vermillion should report another solid quarter and has two catalysts coming. They bought out their partner in the Corrib gas fields off Ireland. They have 20% and are buying another 36% but the deal doesn't have govt approval yet. In the meantime, the gas is accruing to VET from 1/22 and will be added to the P&L when the deal is closed. They also have another purchase pending. Vermillion is getting $35+/mcf for their gas. If Russia does cutoff Europe from further Nord1 gas, ngas in Europe will spike even higher and VET will be one of the beneficiaries.
Here is a Seeking Alpha article discussing Vermillion:
https://seekingalpha.com/article/4523712-vermillion-offers-protection-to-the-biggest-risk-to-the-market-right-now?mailingid=28399114&messageid=2800&serial=28399114.3211&source=email_2800&utm_campaign=rta-stock-article&utm_medium=email&utm_source=seeking_alpha&utm_term=28399114.3211
SQZ Serica merger proposal at incredibly laughable premium
Info and discussion at below thread
Kistos Seeks Merger With Serica.
— Alexander Stahel 🌻 (@BurggrabenH) July 12, 2022
We warned @MitchFleggCEO of such a risk while the board allows for its share price to continue to drift instead of buying back shares with authority & transparency. Now, I can only hope shareholders reject. Frustrating.$SQZ @SericaEnergyplc pic.twitter.com/ohWUSedD6k
sqz.l +.41.4 to GBP3.465 big pop in Euro nat gas due to Russians shutting off Nord 1. Will they turn it back on after the turbine gets installed? I think they will but they'll make the Europeans squirm before they do it.
Serica is almost all ngas so it should respond to Euro nat gas pricing.
VET is puzzling. They get 20% of their revs from European nat gas and they are down today because oil is down. Investors don't seem to get it. Amazing free cashflow is coming from the Euro nat gas. Oil is the major source of revs but their competitors don't have the same pricing on the nat gas. Oh well, have to wait for Q2 p&l to wake folks up. VET will be debt free in 2023 from free cashflow and are talking about raising dividends and buybacks after that happens.
watched video from Eric Nuttall and Nine Point Energy on youtube. He had a guest on that reviewed the prospects for oil usage and prices going forward. Very convincing review of prior recessions and the fact that energy usage hasn't fallen that much during prior recessions PLUS European situation.
SQZ.L -.115 to 2.835 gbp
Serica should have an excellent Q3 based on this story regarding European gas prices:
https://www.nasdaq.com/articles/column-europe-forced-to-pay-even-higher-prices-to-fill-gas-storage%3A-kemp
Thanks for the tip Matt. Bought some SQZ.L today at 2.955 gbp. Had to chase it but it's a nice combo of European ngas prices/crisis and the chance for some upside if they hit their exploration well in Q3/4. Hedging is declining too. Wish they reported quarterly but that's part of investing overseas.
Yeah, there's no easy answer. Nukes can't be brought back online quickly or cheaply(Germany you dummies)
There are no big new sources of natural gas to replace a huge producer like Russia.
They can probably crank up some old coal fired furnaces a little more quickly.
Winter is coming and Europe is going to pay thru the nose! Who's going to get reelected if nobody has heat in their homes.
We've redirected LNG from Asia to Europe but that's not going to last very long. Asia(China) is going to need that LNG to reopen their country and if there is a cold winter, LNG is going to fly.
SQZ.L I own on London exchange. Yes, simplistically it is a gas prices higher for longer bet. I don't see how anyone would think EU natgas prices revert completely
are you buying Serica in London SQZ.L or the otc symbol sqzzf. SQZZF doesn't trade much. Hasn't traded for a few days.
Looks pretty interesting. Mid level producer. Not a startup by any means.
The Central Bankers threw a wet blanket on the stock markets, energy, metals, you name it. Might wait a bit for the dust to settle. Fundamentals are pretty solid unless world economy goes into a BIG recession. Still need energy to keep the lights and heat on. Still need food. Still need metals to make anything.
I have an enormous VET position. If you want to add some torque one EU gas producer to check out is Serica. Their FCF % is insane and there is wildcatter upside when they drill this year.
Looking for a conservative way to play the natural gas crisis in Europe. Vermillion, VET, has oil and gas but specifically ngas produced in Europe. They are getting those massive $40/mcf prices. It may not get a lot higher but spectacular gains for the next few quarters. Vermillion has a nice mix of oil and gas in safe jurisdictions. 52 week range is 5.51 to $25. Bought around $20.
Vermillion gets 40-45% of it's cashflow from European ngas. VET fell along with other oil names but those other companies don't have the ngas on the continent.
P/E around 4. Don't see a solution anytime soon for the Euro gas crisis. Wait until this coming winter!
$BDCO: YOU CALLED IT !!!!!!!!!!!!!!!
Its happening again............ Fundamentals better than EVER for $BDCO
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=103470513
GO $BDCO
The Junior Energy board is designed to highlight undervalued junior energy stocks. Commodity prices are going to be volatile and difficult to predict even though the fundamentals point towards higher prices. To help offset the volatility in prices, we are looking for strong increases in production and low price to cashflow or p/e ratios.
Uranium stocks are more difficult to handicap because there are so few producing companies and even fewer profitable companies. To help narrow the search, we will focus on near term producers that have defined deposits and have goals to produce uranium within the next three years.
Many energy stocks are listed in Canada. That is especially true of uranium explorers. However we will discuss any stock that can be traded in the US and Canada thru direct listing or a pink sheet alternative.
Bobwins
Favorite oil plays:
Sundance Energy Australia Limited SEA.ax/SDCJF.pk
S.O 276.7 M
Sundance has assembled 115,450 net acres in various shale oil plays in the US. Their holdings are focused in the Bakken and Niobrara. Company philosophy is to buy the land early and cheap and then sell to bigger JV partners who pay a majority of the cost of drilling. This reduces risk and costs to Sundance. During 2011, Sundance and it's partners will be drilling up to 114 Bakken wells. Sundance exited 2010 around 1,000boepd and is forecasting a 2,000boepd exit rate for 2011. The Niobrara is the next big opportunity for Sundance. They have sold land to Noble Energy with a 3.7% ORRI and JV'd a small parcel with Halliburton. Right now they have a higher working interest in the remaining Niobrara acreage but could sell down more to reduce risk. Sundance also has another early shale oil play in the Atoka, which is in Colorado. May be some exploration by others in the area in 2011. Pawnee is a new area in Kansas/Oklahoma that Sundance has just entered. Sundance has a nice land package in several areas. Their mgmt is excellent and has been grown the company in a low risk way by selling land and working interest to lower cash requirements. As production is increasing, cashflow will provide much of the funds needed to drill and acquire land, reducing the need to issue shares.
http://www.sundanceenergy.com.au/ http://www.sundanceenergy.com.au/2011/03.07.11-SEA%20March%20Roadshow%20Presentation.pdf
Mart Resources MMT.v/MAUXF.pk
S.O 335.5 M F.D. 342M
Mart Resources is a Canadian producer working exclusively in Nigeria. They have been developing what Nigeria considers a marginal field,Umusadege. Umusadege production has grown significantly over the past two years as Mart drilled UM-6 and 7 in 2010 and each tested multiple zones with test results over 10,000bpd each. Each is producing in the 3,000 to 5,000bpd range with several zones behind pipe. UM-8 is being drilled in July 2011 and should be completed and producing by late 2011. Gross production for the field should move over 10,000bpd. Recently Mart has suffered from takeaway pipeline capacity problems. They had an outage in December 2010 when the pipeline was damaged in an explosion. That caused a shutdown for several weeks. Mart still got the revenue from the pipeline company and had to make it up during Q1 2011. With the new wells coming online, Mart has tried to arrange for more capacity. They had a preliminary agreement to boost takeaway capacity to 20,000bpd gross from AGIP, the pipeline operator. Recently they were told the fee for pipeline losses would jump from 1 to 1.5% to over 11%. Mart refused to pay and AGIP has restricted capacity back to the original agreement of around 8500bpd. Mart is negotiating with Shell to build a second pipeline but is at least 1 year away from having a second option. There is likely room for negotiation with AGIP but this takeaway capacity is a crucial near term issue for Mart. In addition to several more development wells at Umudasege, Mart is actively trying to secure additional marginal fields that Nigeria is putting up for bid.
Mart is an undervalued producer. The Nigerian location is a negative as well as the dependence on Umusadege field for all their production. However the production could grow to as much as 30,000bpd gross in 2012 so the company has near term upside. Mart is selling for around 2X fwd cashflow. However the pipeline issue could delay achieving the projected cashflow.
http://www.martresources.com/
Latest presentation from 2011 AGM:http://www.martresources.com/wp-content/uploads/2010/06/21/events/Mart-Resources-corporate-presentation_June24_updated-2.pdf
Saratoga Resources SROE.ob
S.O. 19.7 million
Saratoga Resources is a US based driller with significant acreage in the shallow Gulf of Mexico. Their acreage is in areas governed by the State of Louisiana versus the deeper Gulf waters governed by the Federal authorities. Saratoga got into cashflow problems and went into Chapter 11 bankruptcy to protect it's assets. The lenders wanted to dilute common shareholders out of the picture and take over the assets. Mgmt are big common shareholders and resisted the proposals and worked thru the court system. Two years later, Saratoga has paid off all vendors and has finally refinanced the old lenders. This should free them up to get better financing and aggressively drill out their near term prospects. Current production is around 2,850bpd with plans to increase production to 4,000bpd by the end of Q3.
Saratoga has a PV10 value of 1.3 billion using total resources and 438million using total reserves and 12/31/10 strip pricing. The current market cap is around 100million. Very undervalued versus resources. Cash has not been available for Saratoga to aggressively drill. The situation is improving with a recent financing giving Saratoga an expanded capex budget to pursue what they say is hundreds of drilling opportunities. They are focusing on oil heavy prospects but the majority of their reserves are gas. Saratoga has several deep Gulf prospects that they are seeking to JV. The recent refinance of their long term debt should allow them to negotiate from a stronger position. Many would be partners have been concerned about Saratoga's ability to finance their end of the deal.
http://www.saratogaresources.net/
Favorite gas play:
Favorite Oil Sand Plays:
Oil Sand Charts: http://investorshub.com/boards/read_msg.asp?message_id=21045182
PETROBANK ENERGY AND RESOURCES PBG.to PBEGF.PK
http://www.petrobank.com/
S.O. ~76million
F.D. ~89million(8.9million convertible+4 million options)
Southern Pacific Resources Corp. STP.v STPJF.PK
http://www.shpacific.com/
S.O. 41M
F.D. 55M
STP has 80% interest in 25 contiguous sections of oil sands.
If STP can deliver the increased new 43-101 resource estimate at 300-500 million barrels in early June, with only 55M shares fully diluted, it will be one of the cheapest oil sand resource companies in Canada.
Alberta Oil Sands(Platform Resource) AOS.v AOSDF.PK
http://www.platformresources.com/
S.O. 39.0 M
F.D. 42.5 M
PFM owns 40 sections (25,600) Acres of lease in Athabasca oil sands area in northeast Alberta. 23 sections have estimated an undiscovered resource of 1.15 billion barrel of initial bitumen
in place (IBIP). The other 17 sections are not explored.
Patch International PTCH.OB
http://www.patchenergy.com/s/Home.asp
F.D. 33.4M
PTCH own 75%-80% interests of oil sand leases, after spending the exploration capital.
Ft. McMurray Oil Sands Area
The Ft. McMurray Oil Sands Area oil sands leases consist of Dover/Ells (32 gross sections, 25.6 net sections) and Firebag (18 gross sections, 13.5 net sections).
PTCH claims to have 1.5 billion bbls bitumen in place (gross)
Muskwa Oil Sands Area
In townships 85/86 and ranges 24/25w4 the Corporation has 10 gross sections (7.5 net) of oil sands leases in the Muskwa area.
NORTH PEACE ENERGY (NPE.V NPCEF.PK)
http://www.northpec.com/
S.O. 26.3 M
F.D. 34.3 M
Approx 60,000 net (86,000 gross) acres of prospective oil sands leases in north central alberta
Initial results confirm the estimated discovered resource in the order of 2 to 3.1 billion barrels.
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