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PEI.V (I'm still here!)
Bob - thoughts on Prospera? Looks like they achieved their goals in 2023 but are still close to 52 week lows so I'm interested!
I laughed when I read the latest press release as it looks like through should have said "receivership" but instead said "receivables" in reference to the financial condition of their JV partners on one (or a few) assets? This is probably why they are at 52 week lows.
I've done extremely well on energy coming out of Covid and am now mostly on #fintwit (twitter) under @energyrealist if anyone interested.
Thanks in advance Bob!
TCF.v/TRLEF
Yes I'm still here sometimes :)
Trillion's Nat Gas price for March is down to USD 12.92/MCF at the end of March vs. USD 31/MCF that was being heavily promoted and marketed to Canadian Investors. Still a great story once Natural Gas prices normalize this year after 2022 Euro Gas Crisis. Back in January I spend a few hours doing research and here is how you go from the EPIAS exchange price in Turkish Lira per 1000m3 to USD/MCF:
Since this took me WAY too long to find a primary source and translate here is how you can vet the US 31/MCF price "marketed" in Trillion's latest presentation. Euro gas crisis peak is over so it will be important to follow prices 2022. Go to the Epias Energy Exchange Istanbul link below and look at the November Monthly Report where gas prices averaged TL 20.518/1,000 cubic metres. Easier to write as TL 20,518/1000 cubic metres. TL 20,518 / 35.3 MCF in 1000 Cubic Metres x 0.053 TL/USD FX = USD 30.8/MCF.
If you look at the current MARCH report you'll see gas was right around TL9,000/1,000 cubic metries at the end of March. At current FX the translation is TL 9,000 / 35.3 MCF in 1000 Cubic Metres x 0.051 TL/USD = USD 12.92/MCF.
EPIAS Monthly Gas Reports
ROK.V - cheapest oily small tsxv producer
Disclosure: bought CAD $100k here before latest presentation was out at 0.26. Still should double from today in 2022. Sharing here as this is where my investing board journey started!
Me = energy realist on CEO
My ROK back of envelope
IPO.TO/IPOOF updated comp sheet
@tr8dervic - reserves here, or, look at InPlay's press release for this week.
Reminder: I'm very long since the 0.70s but I think many here have tagged along!
Updated Comp Sheet
IPO,TO/IPOOF
Follow me on Twitter and I’ll update my TSX small oil producer (5000-20,000 boepd, >50% oil and liquids) compset. Likely tomorrow. Art to this but idea is to use all company disclosures, no judgement, hinged completely on reality, not fantasy.
This is the last attempt linked below but I was too bullish across the board on price increase on NGLs (most getting CAD 50-60/bbl currently).
Nevertheless IPO was, and still is, the cheapest company in this range on a cash flow or free cash flow basis. Yangarra appears to have cheaper reserves but they are lower quality assets that consistently underperform on capex requirements.
Disclosure: locked and loaded here with multiple 6 figure position but I haven’t diversified YET because InPlay keeps remaining cheap!
My Comp Sheet
IPO.T it will come
No big banks cover it. Word will get out. It is only the small niche Canadian iBanks (or rather iDesks) that cover it:
Analysts
MGR.V /MGLQF - 2 hour analysis posted...
...of if/how Magna could achieve a 100k gold ounces/year production rate.
A lot to digest but link below to a PDF I posted.
If you look at the big pre-feas exhibit you'll see the strip ratio drops significantly in 2023 & 2024. If we're able to keep daily mining rates even flat from 2022 (~82,000 TPD) it appears we could fill up the 22,000 TPD crushing capacity and achieve at least a 90k oz/year run rate.
My analysis at CEO.CA
MGR.V /MGLQF - what to watch for...
...once you have taken a position:
1. Open pit mine burning a lot of diesel. We need gold to rise along with oil prices. This is a low-grade open pit.
2. Ounces laid on leach pad (e.g, assayed grade x tonnes) vs. Ounces produced (e.g. recovery). Will be important to look at recent quarters to see it actual recovery = 43-101 recovey. Issue with Timmins Gold under the second management team who apparently messed mine up was the build up of inventory as they weren’t hitting targeted leach pad recoveries.
San Francisco was the mine of Timmins Gold (who became Alio Gold after screwing up.
Magna team is the team that successfully brought San Francisco into production and ramped it up, not the management team that ran it into the ground!
MGR.V - gold favourite and strong buy!
Woke up today planning on buying a big position in Magna because in my gold producer chart list literally every single producer has exploded up in last month EXCEPT MAGNA. At least for a trade it was a no brainer.
Disclosure: I bought 60,000 shares at 0.83 this morning, but paying up with stock up 12% this morning on the Argonaut news. No position before.
Then news dropped this morning that Argonaut sold the 9.74mm shares they owned. It traded in a single Cormark-to-Corkmark block trade yesterday (Mar 7). Magna issued the shares to Alio Gold when buying the San Francisco mine exactly two years and two days ago and Alio and Argonaut later merged.
It think this block trade will mark the 2022 bottom in Magna gold. So I paid up for my position today.
I've been chatting with shareholders that have been long there for over a year and the consensus for 2022 is:
- hitting close to a 100k production run rate (25k poured per quarter, would require like ~35k placed on pads. Later in 2022 thing.
- resource update for higher gold price showing +10 year mine life at 100k/year. This could be in March! You can see this coming from the latest presentation (1.4mm in M&I resources at $1000 gold) to over
- Higher production than last quarter (21k oz placed on pads, 15.5k oz produced), leading to falling cash costs through the year.
There is a great board over at CEO.CA (mostly Canadian resource investors). I've been blowing it up this morning if you want to look. I'm @energyrealist over there! I'll post some high level stuf on valuation there now.
See page 9 of the presentation for the M&I resources at $1500 gold.
Presentation
Here is the CEO board:
CEO Magna Board
TCF - huesos were you trolling LOL?
Can confirm I looked hard at TCF last week. I doubt anything will happen quick now with seas around Crimea militarized.
There is a good board over at ceo.ca on this. I asked a question and it sounds like the financing needed to start production is almost a done deal it just needs to close.
I'm @energyrealist over at CEO:
Question on TCF financing
HME.V CEO interview today
Use Twitter on your laptop for the Spaces add-in. I’m on my ipad so can’t see time but Shubham will record it.
All set for our Spaces tomorrow with @djsdjs77 of Hemisphere Energy. Intro to $HME.V followed by open Q&A session. See yall there! 🛢💰
— Shubham Garg (@WhiteTundraSG) January 25, 2022
https://t.co/rpkrPRleBu
GCM.TO/TPRFF - Thanks but....
...GCM really doesn't have USD 300mm cash, they have zero net debt as they got that USD 300mm cash from borrowing USD 300mm. Nets to zero.
This is important as my head was spinning "opportunity" when I saw USD 300m cash and a US 438mm Market Cap.
Anyways - It looks like they are fully funded to build Toparu as it looks like Wheaton Precious Minerals will fund another US $138mm during construction.
The risk with Guyana will be INFLATION plus IN-COUNTRY INFLATION from all the off-shore oil development.
I see mention of a PEA-only on Toparu from December 2021, but, they already secured USD 300mm in financing so I assume the banks are comfortable with GCM putting Toparu into production without a pre-feas or full feasibility study?
Andre
GORO Fun...
...just a fun post. Am catching up on my 2020 taxes as we speak (have a big refund so haven't filed) and my favourite trade sequence of 2020 was selling GORO literally right at the pre-US-heap-leach-about-to-be-commissioned top of US 5.50 (near double) and then then buying it back 20 days later at 2.63 and then selling in June 2020 again for 4.10. Like +175% on that sequence.
Did very well in early 2020 going nearly all-in high beta gold miners from March-July 2020 when the gold commodity price rebounded hard up out of the initial covid sell off. Was like the 2008 financial crisis.
A bit of entertainment over the holidays. Too bad all my trades aren't like that!
MPM.V and Venture Tax Loss
Venture is dropping off a cliff in tax loss season. All my oil holdings and MPM.V (which I don't own yet) are drifting down only slightly as a result.
I think MPM.V is a great candidate to rotate any of your advanced exploration miners you are selling a loss into.
For Gold Producers I took a quick scan of charts and these 5 junior/intermediate producers could be good buys over next week as they have been selling off for months. I have not looked into if there are other causes expect sector and TSX/TSXV pressure:
DPM.TO
EDV.TO
GORO (junior)
MUX.TO
OGC.TO
Hello again board and MPM.V @Lone Clone
Shout out to Lone Clone keeping this board going and quality with his great updates!
I've been all in oil producers for like 14 months except for Emerita Resources EMO.V who is advanced VMS mining developer in Spain which is a huge holding for me and my early retirement ticket. If you're interested the place to start is the CEO board>Community Wiki link>Doc jones diligence reports. I think report 8 is a good place to start for Emerita. It is still an epic opportunity IMO and stock could double in the next 3 months when the company is successfully awarded the Aznalcollar mining rights.
click on the 'community wiki'
I'm happy to report i've had MASSIVE success with my oil producer bet I talk about here.
Value Microcaps JE Post
I don't have any original ideas but i've been getting a lot of my ideas following Doc Jones at ceo.ca. He brought MPM.V Millenial Precious Metals to my attention recently and I've just finished a podcast and the year end investor webcast tonight. Here is the summary.
MPM.V is a former team that has discovered 59mm gold oz between 7 mines and 5 of those mines are in production or construction (see presentation). They went to Nevada after looking at 350+ projects on their desktop and doing 50+ site visits** and have 1.2mm gold oz between two sister projects (Mountain View & Wildcat) at the highest "effective" open pit grade in Nevada which is 0.42 which is grade/strip ratio. They have CAD 16mm in cash, are undervalued and misunderstood from IPO-ing during covid and are drilling through 2022 consistently and think they can get to 1.5-2.0mm open pittable oz at a higher grade using more core. PEA in Q3-2022 which is being done closer to a PFS level. All inferred oz but most of ore is OXIDE and any sulphide material is non-refractory. They purposely avoided refractory sulphide properties. Out of the rest of their projects Red Canyon has the most potential and even if it doesn't grow from the smashing 54m @ 4.5 g/t drill hole they probably have 300-400k Au oz they can sell to McEwen Mining who is right next door as they share the Red Canyon mine access road with McEwen's Gold Bar/Tonkin mines**.
As of friday MPM.V had a CAD 70mm market cap and if everything goes as planned in 2022 and 2023 they could be re-rated to a 250mm market cap which would be valuation in line with Gold Standard GSV.V.
**These two starred facts is from the CEO in the doc jones podcast and you otherwise would not have heard them without me!. See Below.
MPM.V Start with the Dec 7th. year end investor webcast for DD:
Webcast
MPM.V And then listen to this Doc Jones Podcast and you'll see how impressive, astute and disciplined the CEO is:
Podcast
HME.V Cheap Micro-Alberta Oil Producer
Page 8 of November Pres is a good place to start. 2P (TP) NAV at $70 WTI is $2.68/share vs. $0.98 close today ($C).
$C 90mm market cap currently.
[urlhttps://www.hemisphereenergy.ca/sites/default/files/2021-12/HME%20Corp%20PPT%20Nov%20MARKETING%20TRIP.pdf][/url][tag]November Pres[/tag]
Otherwise this is a 2022 2,550 boepd (90%?) oil producer with only $C 16mm of debt and a very low decommissioning liability and a 19 year reserve life index. They have two oilfields under waterflood and production growth in 2022 is already paid for and comes from a polymer flood. 2023 production upside is from polymer flooding the other oil field.
Opportunity best summarized here:
Seeking Alpha Article
GASX.V Took a long look.
It is very overvalued now. Overhyped during the 2021 global gas crunch and will digest the big run for a while IMO. Serafino the CEO is very astute at dropping nuggets that simply aren't realistic like getting to 200,000 mcfd in a few years (Canacol still isn't there sustainably) and their SINU-9 wells producing at 30,000 mcfd (not realistic, ONE of Canacol's well produced above this for 24 hours from two zones, LT production rate more like 10-15,000 mcfd).
It is Colombia and if you followed Canacol there will be disappointments on drilling timelines, but mostly, pipeline completion and connection timelines. I've looked at retail investor comments on CEO.CA and everyone is so bullish on this stock and have bought into the 200,000 mcfd hype that there will be a big stampede to the exits at some point in 2022 when those expectations aren't met.
I looked at what Canacol trades at on an EV/boepd basis and the market is currently valuing GASX like they are production 36,000 mcfd while they are actually producing nothing.
Near term opportunity would be if their Maria Conchita assets come online at a far lower production level than market anticipated (they are expecting 20,000 mcfd+) OR it turns out they actually can't sell their gas at US 7.00 to 7.50/mcf like Serafino was promoting and this fact becomes another highly promotional point.
I will own at some point in 2022 most likely but will wait for a big sell off when the global winter gas market chills out. Stock will probably come down with that as most of the SINU-9 wells won't be drilled yet.
The SINU-9 assets could be a company maker so I'm following.
Update! and some recommendations
I’ve guided the combined portfolio of myself and my partner into millionaire status thanks to going all-in oily producers since September 2020 (plus one miner)! Whoo hoo!
All this years of early morning PST market wake ups and patience paid off in a very short time frame!
A couple notes:
- check out HME.V Hemisphere Energy for a little known Alberta oily producer
- have a big position in TAL.V which is drilling Mart Resources-style wells (9000 boepd) into their Bretana Peru Amazon Basin field. Only problem is getting oil to market. Added more on last selloff at 0.30 and would love a triple on that. Will sell on big move as shipping oil on the Peruvian Amazon-to-Coast pipeline is a nightmare. Will always be undervalued but can produce up to 30,000 boepd in 2023!
- still holding IPO.TO as a smaller Alberta Producer still trading at 2022 2.5X EV/FFO at $70 WTI. Another big position.
- rationalized more capital into FEC.TO today. Not really any downside and is about to report results on KAWA-1 offshore well in Guyana in next couple weeks. FEC.TO owns more than 80% of OYL.V who is drilling the well. 35,000 boepd Colombia producer, formerly part of Paific Rubiales
I’ll post my thoughts on GASX.V and HME.V seperately.
IPO.TO vs. GXE.TO
This ceo.ca poster is who alerted me to IPO.TO. Here is a comparison he made between them from May 21
https://cdn-ceo-ca.s3.amazonaws.com/1gafued-Screenshot%202021-05-21%20111904.jpg
GXE.TO Huesos IPO.TO
FYI - I had a big position in GXE. I sold down half and rationalized other positions and have IPO.TO now as my largest single portfolio position.
My portfolio is pretty much all Canadian oil producers too.
Check out the last week of posts on the IPO board over at CEO.CA. I’m now posting there under the handle energyrealist as I lost my old dr_airtime login.
You’ll see my thesis in the most recent posts. IPO.TO is a small producer like GXE.TO (5000 boepd), but I bet IPO.TO is the cheapest oily (>60%) producer on the TSX/Venture. EV/boepd around $C 25,000/boepd at today’s close.
If you click on my id (energyrealist) you’ll see my latest posts on all boards. Most are on IPO.TO recently.
I kept a big slug of GXE.TO (like $C 50,000) cuz the chart looks so damn good!
CEO IPO Board
REG.V - waiting for Election
Great buy opp on or after June 6 if Keiko Fujimori wins. A double to 52 week high from here. No need to do anything till results.
Saying in Peru is you are always voting for lesser of two evils in the Presidential election.
Castillo announcement
ITE.TO podcast
Here is a podcast with the CEO from Friday. Gives a nice status update on plans through March 2022.
https://www.voxmarkets.co.uk/media/60952d81017903524c8e097b/
GXE.TO
Took a few months but GXE basically consolidated flat at $0.50 for two months and just exploded + 30% today on Eric Nuttal's top pick from last Friday. GXE was formerly (as of last Friday) the cheapest producer he covered on an EV/FFO or EV/CF basis.
Didn't sell any on the pop. I think we'll open a bit down tomorrow but GXE will keep moving up in 2021.
"I mad all my money sitting still" - Jesse Livermore.
I haven't been trading this oil price rally at all. Only movement I have done is to sell leaders like WCP.TO, VET.CO, CPG.TO and move it downmarket into the smaller proucers like GXE.TO, SGY.TO and ITE.TO.
SGY.TO is due for a bounce upwards this week. Still waiting on ITE.TO to move but as soon as market wakes up to ITE.TO it will be a very, very good day for me!
ITE.TO
Since it was essentially a new issuer in Nov 2020, i think they only have to report their fiscal Q1 (Jan-Mar 2021) by May 17. Perhaps there is an exemption and they don’t need to report 2020 audited FS for the full yeae because of TSX listing timing. We will get audited FS for the year on the AIM by June 30 I believe.
OSC TSX & Venture deadlines
ITE.TO - locked and loaded.
Have $CAD 100k in ITE.TO mostly in TFSA accounts looking for a multi bagger this year. Good introduction presentation linked below. Here are some highlights. Reminder that Market Cap is CAD 133mm. Net Debt should come in <CAD 40mm when they report year end in a couple weeks*
*unless there is an exemption to delay past Mar 30 as dual AIM-TSX listed entity.
Gain (9000 boepd) and Toscana (1000 boepd) acquisition notes from Proactive Presentation below
- Toscana: 1000 boepd producer but gave them a management team in Canada.
- Gain & Toscana - bought assets for <$3000/bbl. Stupid Cheap.
- They do have more gas than oil in portfolios
- 500 production wells from Toscana/Gain assets currently.
- 200 drilling locations with IRRs>50% at WTI $55 at Clearwater.
Cleawater has gone from zero to 30,000 boepd in 3 years in WCSB (think Tamarack Valley TVE.TO is biggest player here)
- 18 different production facilities that came with Gain Acquisition. Operated infrastructure. 120 MMSCFSD, 20,000 boepd capacity in Gain Infrastructure. Also generate $2mm/year in 3rd party revenue. Easy path to 200-250% production growth.
- Have maybe 1 billion barrels of OOIP at Clearwater Acreage. Heavier Crude. Drill, complete and tie-in in 30 days. Wells cost ~$1.5mm come on at 300-500 bbls/day.
December Proactive Presentation
ITE.TO Update (also there is an OTC ticker apparently)
Bought most at 0.155 and at 0.19 it has grown into my second biggest O&G position. I also sold down some of my larger intermediate caps up big (CPG, MEG) to buy ITE. CPG was formerly largest position.
This guy Doc Jones on CEO.CA released a diligence report that arguably was the first public analysis of this company. His twitter account blew up overnight and volume on AIM and TSX ramped starting last Friday.
Market is still going to wait till a) they see a presentation from the company outlining what Dr. Jones has pulled up and b) a balance sheet post merger reflecting the new company which is i) old i3 energy (north sea assets) ii) Toscana (old 1000 boepd venture junior) and iii) Gain energy (8000 boepd producer owned by Canadian pension OMERS who jettisoned it during oil bloodbath and anti-carbon sentiment peak of 2020).
Doc Jones Report that Woke up ITE this week
ITE in Canada is all about the Clearwater play. Assumption is that ITE's development will look like TVE.TO's. TVE's corporate presentation is down but I'll post next week.
Also - it should be noted that two of the board members of ITE are from the IONA energy failure (TSXV listed North Sea Junior that went bankrupt, but really due to factors our of their control - minority interest, oil prices down 45% YoY, funding partner that backed out). I think this is a GOOD THING this time as they won't want to screw up the second time and IONA was a worst case scenario. Also check the pedigree of the CEO - former Managing Director - Corporate Finance of First Energy - biggest energy investment bank in Calgary - now Steiffel First Energy.
Board
Graham Heath And Neil Carson are IONA team (latter founded Ithaca Energy).
What a rally! + new company I3 energy
Rally of a lifetime for me as family's portfolio has been 90% oil producers since oil price started climbing in November! Opportunity of a lifetime in oil market really playing out which was original thesis.
Haven't tried to trade at all including (unwisely perhaps) not taking anything off the table before yesterday's OPEC meeting.
Anyways - here is a producer that is off everyone's radar as I think they were originally an AIM junior that only listed on the TSX in November after an acquisition of 9,000 boepd from privately listed Gain Energy that was perhaps also rationalizing assets during the downturn.
i3 Energy IET.TO. They also have an AIM listing that may be more liquid? As of today they trade at a $C 98mm Market Cap and as of June 2020* they had £15mm or $C 27mm of notes/debt issued for an EV of approx. $C 125mm with current Alberta/Saskatchewan production of 9,150 boepd (41% liquids) so are trading at $C 13,700/boepd (EV/boepd) on production below plus it looks like they have a nice North Sea discovery with a P50 STOIIP of 197MMbbls. They have logging results in a PR and the presentation so perhaps they drilled an exploration well but need a partner (and a permanent platform) to turn it into a producer. Icing on the cake.
*last set of public FS from mid-year 2020 per AIM semi-annual reporting requirements only
This is last PR.
i3 last ops release
This is last Corporate Presentation.
Presentation
Hard to find but this is last set of FS I found. Didn't search SEDAR but didn't find anything disclosed via stockwatch since i3 traded on the TSX.
June-20 AIM Report
SYTA - this popped up...
...in my twitter feed today and I have never mentioned nor followed anything with Siyata. Candian first responders would need Uniden technology to access this (Rogers one of the big 3 Canadian carriers)
twitter bot says buy?
SYTA..
that is a 0.17 target for most of us here :)
GXE.TO (Huesos)
..Huesos I think you have joined a few of my positions! I find the CEO board is a good indicator of astute retail Canadian resource industry interest. It was pretty quiet when I bought SGY and the GXE board does not have any real posts since early December.
Volume has picked on GXE. It will explode higher like SGY within a week IMO.
Just posed some questions on the CEO.CA board if anyone wants to follow. Only red flag for GXE is the large abandonment liability but the market will not care about this in 2021 IMO.
CEO GXE Board
SGY - next one GXE.TO
SGY should be a big winner for me. I should have bought more. Oops!
FYI - I just traded some of my largest cap intermediate Canadian oil producers that have been big winners (CPG - Crescent Point, MEG) today that turned into outsize positions in certain accounts for this little Canadian producer:
Gear Energy GXE.TO.
Just looked and ended up buying 205,000 shares across accounts this morning!
Basically all the small Canadian oil producers went stratospheric last week and today while the larger caps have not as much. Small Cap space playing catch up.
This is a catch up-trade for little 5000 boepd oil producer with low costs and some of lowest relative debt in the Alberta Oil Patch (only ERF.TO/ERF may be lower).
Read the last PR and then flip the presentation below and then look at the chart and my buy should be crystal clear.
Last Press Release
Presentation: see slides 3, 9 & 18
*See Slide 9 for Dec-21 FFO/Net Debt @ WTI $60
*Also see slide 18. I bet at Feb 8 Strip prices Gear will do $CAD .40/share FFO in 2021 (Slide 18 at January 8th strip). It is trading at just north of $CAD 0.30/share ($CAD 61mm market cap) with $CAD 61mm of Net Debt. Quick math and GXE.TO is at 1.6X 2021 FFO/EV today. Stupid Cheap.
Note I did not do the calculation before I bought 200k+ shares but am now glad I did! This is why I like posting here as it forces you to write out your thesis...I would go and buy some! Easy to get filled today.
ORV.TO thanks for the reminder
Let me take a look. They are mostly a copper miner from Spanish assets if I remember and copper miners except Orvana have gone nuts.
(FYI - after buying intermediate cap gold stocks out of Covid bottom I basically sold out and spend H2-20 monitoring and nibbling on the Canadian O&G producer trade and have since made a killing in that in last 2 months. Like 80% of portfolio there that is why I have been absent here)
One more thing (Bullish)
Suncor SU.TO one of largest public cos on TSX, formerly largest oil producer (now second I think after CNRL-Husky merger underway) has had a golden cross.
This is the go to no brainer name for generalists looking for oil exposure. Very good for all the mid and small caps I own!
Largest Energy COs Canada
Bought SGY.TO
Sold half of a an oversize position that doubled in MEG.TO which should have been a leader, and was.
Just take a look at the chart and if oil market stays flat to up I think SGY will get bid up to fill the gap at 0.60 to 0.75.
So I’m moving down into a smaller oily producer doing 17k boepd now at maybe 70% oil and NGL with a 20% corporate decline rate.
They have a lot of debt and company was going to be forced to sell but that pressure has been alleviated now. Jusf read the Q3 PR a couple times.
Thoughts posted here tonight. Board quiet. Very few Candian oily producers that haven’t leaped yet in 2021 and this is one!
CEO Board
FEC.TO
CEO.CA. board pretty active. It is mostly active Canadian retail investors there who primarily play in resources. Pretty good crowd I found.
Key fact pattern I got from there today is that the old Pacific Rubiales took on too much debt and this crashed the company. FEC.TO is what emerged and the shareholders are mostly lenders so this explains why they hedged basically 6 months of production at Brent 35 which will go down in history as one of the worst moves in the sector in H2-2020!
FEC.TO quick facts
- interested because chart has a ton of upside and they are a large producer and International Canadian listed companies just started moving early last week.
- i think they do mostly heavy oil. The Q3 Results PR discloses ‘net realized sales price’ and I remember seeing a US 10/bbl ‘quality, royalty and transportation discount’ in maybe the 2019 MD&A. So assume $10 less than Brent.
- they now own a strategic bulk liquid cargo terminal near Panama canal. Need to look at this history but don’t think Frontera is given any value for that.
- they did 70k boepd production in Q1 not my 63k from before. It looks like it is all the higher cost (read: transport) production in Peru they shut in. A bit of a free call option for when Brent prices eventually rise.
GTE.TO/GTE - sold and here is plan
Bought first, asked questions, took my 20% gain and sold today. Poster over on IV made a point and FEC.TO is dramatically cheaper, less riskier, and should be able to ramp back up to 60,000 boepd pretty quick (they did maybe 63k in Q1 before Covid shut ins).
GTE (US listing all $USD) has 785mm of debt, 20mm of cash and a 142mm MC for an EV of 902mm and has guided for 29,000 boepd in 2021.
FEC.TO has an EV of 359mm ex-strategic port assets (see slide 6 of presentation below, adjusted $C 2.10 SP for current 3.43 SP) and 239mm of cash. They are not even close to going under. They screwed up big time and hedged most of Q4 and Q1-21 production at $35 Brent. Big Oops. Market will look past this eventually. Currently producing 43k boepd.
FEC.TO is the old Pacific Rubiales that was pumped to the moon and had a stratospheric valuation. I don’t know the whole story but it is mostly Colombia and Ecuador so there is risk. Look at the latest pipeline PR for example.
Key links:
Q3 earnings slides
CEO.CA board has a good discussion
GTE.TO/GTE
Posted some thoughts over here as old board might now wake up.
IV GTE Board
Huesos ERF.TO
Definitely watch the Eric Nuttal BNN segment from friday. “Market Call” show. They usually split the segment up into like 15 parts.
Think Eric said He bought 500k-1m shares in last part of week as money is flooding into his fund and it is his top pick last week because of the high royalty structure in US Bakken ERF’s free cash flow really starts to ramp when WTI goes from $50 to $60. If the contested (Dakota?) pipeline gets shit down the incremental transport cost is $2/bbl. Bakken production will not be stranded.
Watch the clip. Around 2/3 of way through show. Here are my notes I typed out:
ERF.TO - could be 2-to-3 bagger. Prinary asser is bakken and has high royalty. Above $50 the cash flow really, really ramps. FCF yield at 25% . Daffold pipeline market scared. Eric bought a lot in last 2 days. 500k-1m shares.