focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
As well if you all look the differential for Edm sweet is now sub $2 the move from 6$-2$ on each 1000b/d = 1.46 million usd added to fcf
Tony you are using the WCS Mar 31 price not the April 3, if you use Oilprice.com you have to look to the right to see the date of price shown (mar 31) WTI is current but many others are always delayed 1-2 days. Wcs does move independently of Wti its price is a function of WTI - CME differential.... the April 3th price is 51.45$ as showed here https://boereport.com/markets/
Current May differential is $10.35
Go look at price History of wcs realized price on Oilprice. Com it goes back to 2016 we are close to 8 year high in printed price in USA but are at highs in Canadian dollars when you consider the currency exchange. Highest price since 2013. Currently I think i3 only produces Edmonton Sweet crude, Clearwater doesn’t have any production yet..... we ll know all in a few weeks with the q1 filing.
Podcast* typo lol
Doc Jones shares his views on the oil and gold sectors on the KE Report Weekend Show, check out the last segment. (Last 19 min of show) Highlights the tremendous value in Canadian oil/gas sector and his top pick, i3 Energy. https://podcasts.apple.com/ca/podcast/the-korelin-economics-report/id914229141#episodeGuid=http%3A%2F%2Fwww.kereport.com%2F%3Fp%3D76608
Wcs prices are getting better, differentials continue to narrow to wti “Canadian heavy crude’s discount to West Texas Intermediate (WTI) narrowed on Thursday to the narrowest level since mid-November:
Western Canada Select (WCS) heavy blend crude for May delivery in Hardisty, Alberta, settled at $9.75 per barrel below WTI, according to NE2 Canada Inc, narrowing from Wednesday’s settlement of $10.30 per barrel below the benchmark.”
Catalyst for ng is record ngl export from USA, low storage coming out of injection season and supply down due to lack of oil drilling to name a few. As well lack of drilling in Canada ensures a robust market in 2021 2H -2022
Gdp forecast to 2025 and non-opec supply and forecasted demand under all reference case non-opec supply peaks 8 years prior to demand which means higher prices for longer as well as increasing demand for NATURAL GAS as more ng become seabound in the form of ngl for industrial and electrical generation.
Charts in links
https://ceo.ca/index?9a2f40ce99c9
https://ceo.ca/@drjimjones?dc6bd05feaa7
(In Canadian dollars) If we agree fcf in 2021 is 40 million and keep it flat in 2022 another 40 million = 80$ million current Enterprise Value is $140 million. Now minus fcf after 8 million a year in dividend = 140 million - 64 million fcf after dividends = 2022 ye Enterprise Value of $76 million / annual fcf 40 million = free cashflow yield of 52.6%. What!? That mean they could buy back every share in under 2 years from fcf.... now consider production growth, higher oil/gas prices, etc ... enthralling isn’t it, really straightforward to see why it’s the best investment in sector
But you are not including for approx 1/2 the q their liquids was getting an average price 15% below what the liquid in the second half of q received. Liquid account for the vast majority of rev and fcf, Which had a large effect on fcf for q1 .... So at current prices the annual run rate of fcf is at least 40 million. Canadian. Then add in Noel and other wells throughout year easily 55-60 million in fcf especially considering oil only accounts for 15- 17% of production and 43% of rev. Adding a few hundred barrels let alone a 1000 barrels of production of oil will have a tremendous effect on fcf, dividend and share price.
Personally I’d stop worrying about every tick, there is always “sell on the news money” let retail sadly do what it does best as a whole, miss the boat. Enjoy the next 2 years of growth, based on fcf presented here today the company will be net debt free by the end of q2. Here’s the new slogan for the company “ Hi we’re a new kind of oil company in Canada, no debt, low cost, high dividend paying with a portfolio of low risk multi-decade drilling opportunities as well as a possible Estimate of +100 million barrels in the Clearwater oil play with IRR exceeding 300% and possibly a few hundred million barrels of North Sea Brent (200 million identified already) We plan on at least tripling in size, we already have the infrastructure built for that capacity, bought it for pennies on the dollar, might as well fill it up, looking forward to getting to know you all better, from Uk to Calgary, we are I3!” Might not fit on a coffee mug but do you get the point on why following every tick or trying to understand irrational thinking is a waste of time. Focus on the data. Best Doc
$2 million q 1 ( that’s really good because Jan oil liquids prices was 10$ lower then current) If you say $8 million Canadian is 20% of annualized fcf then total fcf is $ 40 million Canadian Annually, without Noel tie in, including Jan lower liquids price, production flat etc). 5.7% dividend yield, +40 million in fcf, at 5-6x fcf it’s a double, add in production gains and oil/ng price increases a triple +.... then North Sea JV and/or Clearwater development.. Year 1 looks very strong
HI Tony, I'm just saying those who are selling in the UK... some inst. and market makers have an interest in keeping the price depressed in Uk vs. TSX because in theory you could sell on TSX and buy on UK and profit the spread.... For now anyway until investors in both countries realize they are being gamed by a few inst. houses that have to ability the transfer shares across 2 exchanges.... Can't prove it but where there is an opportunity to scalp 5-10% I'm sure there are those who will take it. So if you are planning on selling in general check the price on TSX first.
Trading at 20.5 Canadian now or 11.8p... why on earth would anyone in the uk sell at such a discount so an institution can arbitrage and screw you.
477k on bid 18.5 ask 222k on ask at 19.... volume 1.4 million shares
Last trade TSX Canadian 18.5 cents bid 18.5 ask 19.... 10.6p
Clearwater is being worked currently, but understand it's not an over-night drill situation. The prior owners never exploits oil zones, I3 first must do geophysics on ground first, requires time. I suspect if they haven't already, first well in clearwater will be in q2. The competitive advance they have in several pre-existing NG well bores that can be reenters and used to do all the test work and possibly for production with some mods. That cuts cost an improves time to market and cost.
Basically up to 8 oil pay zones, offset operations have hit very productive zones in the E,F,G oil productive zones.
“• Well-delineated resource – large inventory of legacy Lower Mannville gas well penetrations
(Note: cheap to develop use prior bore)
• Petrophysical interpretation is hampered by radioactive clays and pyrite which suppresses
resistivities, resulting in many operators dismissing potential pay (Doc note: thus why prior didn’t exploit they couldn’t see it )
(Doc note: The risk, but many others are able to cope the this)
• Challenges include varying permeability and viscosity (100-2500cp.), clay content (10% Smectite – 15% Kaolinite), fines migration and carbonate cementation
(Doc Note: Hard data, means possible over saturated oilzone below and the oils migration to gas sand zone, very positive )
• Toscana acreage – several Clearwater (Marten Creek) gas wells in the southern block produce oil that operators have found in tanks, separators and pig traps
• Documented oil shows in drill cuttings from multiple prospective Clearwater sands
(Excellent data point)
• Offsetting cores in the
Clearwater E/F/G with heavily oil saturated sands, high perms 200 – 1,000 mD and high porosities 25-30%”
? A music video link?
Go to the links I posted or boe report .com search Clearwater, use tve then click around and you’ll find the info on I3 inherited wells drilled decades ago it ng pay zones, oil zones never exploited. Plus if you go to the links you’ll see offset operators close by drilling and producing oil, therefore the odds of i3 producing oil are very very high. The Clearwater acres they inherited from what I can see haven’t seen a drill in decades.
It’s also an easy win, quick to cashflow ties directly into Gains infrastructure.
Noel was a new well. Testing that area, no reserves booked prior for drill location or offsets wells. It’s very positive, ip,d at 700boe/d under choke thrn produce at 500boe/d at a further choke. It’s conventional so low decline rate. Adds cashflow, reserves and drill locations
https://ceo.ca/ite?67a867e8c28f
https://ceo.ca/ite?320e5dab557e
Clearwater is now being recognized by analyst community as a reason for a prem. multiple, ite will get its recognition soon imho. This came out today, notice the justification for tve upgrade, i3 has the potential of 100-200 million barrels of recoverable oil in their Clearwater acreage
“ Analyst Jeremy McCrea with Raymond James raised his price target on shares of the Calgary-based oil and gas company to $3.50 from $2.50.
While investors have been pushing E&P share prices higher on expectations of stronger WTI, there remains a few names that we expect to also see a multiple expansion (and not just a reversion to the mean)," McCrea said in a note to clients.
....Historically, where we typically see the largest multiple expansions in the sector is when a company discovers a new play/formation, especially in a resource play where there remains plenty of running room (as investors price in this future undrilled inventory)," the analyst said.
McCrea said Tamarack's recent entry into the Clearwater play is not being recognized by the market.”
Another point tve, great company has a ev of + 900 million, but has a lots of hedges in place and analyst say it’s under valued, if you accept that then i3 with its 130-135 million EV and no hedges almost net debt free is extremely undervalued ( I’m aware tve has more production etc but barrel for barrel and fcf and upside i3 is extremely cheap to the cheap) i3 will be reports it’s first q ever in Canada in a few weeks, so unknown but once the Inst/analyst dig in and see the infrastructure, Clearwater, North Sea etc repricing will happen. Oh right we also will be paying a nice dividend as well.
Institutional Money has arrived in Canada, today over 3.7 million shares bought by Anonymous in 7-8 block trades averaging 440k each trade. https://money.tmx.com/en/quote/ITE/trade-history 4 .Good sign