Member Info for Drjimjones

45% of the volume on the TSX is Block Volume, generally associated with institutional investors. fyi

This is positive, too soon to say it's a trend yet, but I believe the TSX will be the dominant exchange for I3 in the next quarter and therefore the price setting exchange. That's good for the UK investors because i3 has always traded at a premium on the TSX compared to LSE

See, we are all right and wrong. The inputs will vary a little, but in the end, I think we can all agree that there is value yet to be pricing in to the current share price. And the risk/reward is very attractive. Currently in North America this is a seasonal low demand period for NG due to weather (no a/c or heat running ) plus the obvious effects of covid on consumption of energy. The summer will bring driving season, electricity demand and reopening of businesses driving prices higher. I3 is unhedged. I believe for 2021 ng will average +3$ and wti +65$ but if I’m wrong and it’s 2$ and $45 i3 cost structure and balance sheet will enable them to acquire over leveraged assets for internal cash at very attractive prices enhancing its value.

Tony, It's good exercise but production will grow. using a 1656 b/d oil really shows how quickly rev could jump because to double oil production in a year is very achievable working from such a low base, oil rev though account for 41.5% of total Rev, If total production grows 17%to aprox 10800 b/d but it's oil that accounts for the increase, REV increased 41.5%. Under the below the all in cash cost cost per BOE = $17.87 USD. Doubling oil production would add 35.7 in FCF to the 56.1 Million USD, so an incremental increase in oil price/ and/or production has an extremely positive effect on FCF and there fore, share price, dividends etc etc etc.... raw data

GGG go ahead do the math. pretty simple, the production taxes will change, they are 10% of price and move with oil, ng, nil prices

Yes. Here's what I get under a $80 WTI oil price using that flat production profile and cost from analyst report.

NG 5244x365x$15
OIL 1656x365x(80-3 differential Edm Sweet)
NGL 2300x365x (80x.55% of WTI)

Production Rev =$112.1 Million USD in Rev
Pipeline Rev= 4 Million

Total Rev $116.1 USD
All-in Cash Cost including marginal increase in production taxes on increase realized prices = $60 Million total cash cost

FCF= 56.1 Million USD

at 700million shares out FCF/ Share = 0.08 USD, Dividend at 30%= 0.024 USD
at 850 million shares out FCF/Share = 0.066 USD, Dividend at 30% = 0.0197 USD

Current Price: $0.135 USD

This assumes no production growth just keeping production flat.
Therefore the cash balance in treasury would increase $39.27 million USD under a 700 million shares out and around 45-46 Million at 850 million shares out to include cash received from exercising of Warrants (I'd have to check but isn't there 30-40 warrants around 30p)

Tony, what production levels for each are you using?

Nothing changed, I’m being conservative to illustrate how in the current environment how cheap it is, my personal target 2 years out is much higher but also includes a $70 oil price in 2022

Morning from across the pond. Interesting discourse here. I think someone nailed it quite simply, the old and new i3 are 2 very different companies. The first was a high risk/reward exploration company. Generally all or nothing. It’s price collapse was not unwarranted but very over done due to macro influences at the time with lower for longer oil prices. It was a non revenue cash burning company. Today i3 is a rev/cashflow generator with little risk. The WCS basin is akin to a manufacturing process, well defined, like Permian in Texas. Predictable. The advantage i3 affords over its peers is that is basically net debt free and has the infrastructure to grow +3 x. Now the cost has been extremely low to achieve this. The share count is large true but share count means nothing without it being referenced to Enterprise value. Current ev is approx 120 million usd, this year depending on oil price they will generate fcf of 25-35 million usd, if in 2022 we agree they grow 20% thrn year end 2022 Enterprise Value will be sub 50 million usd. That’s incredibly cheap, that would mean they are trading at sub 2x fcf to enterprise value while growing fcf. If they do intact acquire more production, I expect it to be done from cash in hand, meaning non dilutive, great, grow fcf faster. In the end the company has experienced a reset. Old comparison are a waste of time frankly. Just ask yourself this “based on the current fundamentals and where reasonable the prices will be in 18-24 months would I be a buyer or seller?” Personally I see .40 usd very easily achieved in that time frame. Without even considering the North Sea upside. If I had a 10000 shares at 1£/share sure I’d be frustrated but for an additional logically 5000£ I could have 60000 shares at a cost of .25 p plus dividend. Meaning I can reasonably turn a loss into a profit in a short time. But each their own. We are exiting one of the great opportunities to create wealth for yourselves due to fear and panic from covid and the misguided fear of the death of the fossil fuel industry. Finally thought the ride will be bumpy and often boring, but when an investment is boring that’s a good sign. Park your capital and forget it.

Can someone please post the WH Ireland report please? Much appreciated Doc

https://ceo.ca/ite?e2a4f4929328

Follow link, there’s screen shots from public filings.

Best
Doc

And analyst report to use

https://cdn-ceo-ca.s3.amazonaws.com/1g5cou4-ECDF6744-42DE-4BFD-9C35-78A652DFC374.jpeg

https://ceo.ca/ite?e395a4ba888b

Best
Doc

Even without Clearwater which isn’t as advanced as Gains, they can add 1000/b/d pretty quicker with Gains shut in, work overs and in field opportunities because the infrastructure is already there to support 3x growth

The additional 1000 barrel of oil is an example of how little production added over the year will effect fcf. They are starting from a low base production and have capacity and capital to expand production quickly is the point.

Updates NinePoint Capital graph for fun: https://cdn-ceo-ca.s3.amazonaws.com/1g59uu3-F2B37DA7-403D-4E96-A7B7-A4A6EA80E2BF.jpeg

RBC wealth client update on oil 1day sell off:
https://cdn-ceo-ca.s3.amazonaws.com/1g59qr9-9C3FFCB6-6027-47A9-BFAC-75775CB15FCA.png

Answers to prior Q: yes I think they’ll be a production update with dividend announcement as well as an updated guidance.

I asked Graham “are you contemplating a share consultation to tighten up share structure?” “No, that’s not something we are looking at currently”

Note: we are all in the same boat here until the Q1 filing and can only deduce what this year will be by the current and forward strip pricing, assimilate info from videos, public filings and what Murbawd published. I suggest everyone interested in investing here take a 12 month view/approach. If all the research/analyst are right and Wti oil averages $70 in 2021 and we see a supply deficit in the back end of 2022 i3 will do exceptionally well. They are the most unknown undervalued in the group.

Every 1000 barrels of oil production added provides $24.5 million usd in additional rev $70 wti -3$ differential = 67$ realized on Edm Sweet) Without taking into account how unit cost will go down and margins increase in each incremental barrel due to fixed cost get spread over more barrels, at current fcf margin of 35% (using Marbawd production/cost numbers from Nov 2020) that equals an additional 8.6 million in incremental free cash flow.

7 trading days until end of quarter. Max 7 days until dividend announcement and corporate update and updated Corp guidance. = Max 7 days to rerating

Tony I asked a lot of questions and a lot of his answer were “that will be answered in the coming filings”. He can’t give me inside info. My general sense is everything is going well. The North Sea no new info other then what’s public, refer to recent news release and wait for updated guidance in the next 2 weeks.

Important take always are plan to grow production vs hold flat therefore higher fcf in 2022 assuming flat pricing, live in cashflow, lots of quick easy cost effective wins in Gains and Toscana portfolio. The Clearwater will be developed after mapping of structures and zones.

Just has an hour long talk with the Graham, the CFO and founder. Keep in mind he can't tell anything that would be considered inside info. 1) Clearwater: It's clearly a focus, they are working Clearwater currently, mapping structures, etc, etc, they have been conservative in their estimation of resource, other operators are modelling 28% ultimate-recovery of oil in place using the same % our ground could hold up to 300 million barrels, interestingly enough when Toscana was marketing itself for a sale their Clearwater Acre wasn't known it was in the Toscana Portfolio. Toscana hadn't done much work up there over the last few year due to lack of capital. They are working it, some news in q2. 2) They will grow production this year (based on prices) Gain's portfolio has a lot of easy wins for cheap and quick production gains, the in fracture is already built up to 30k BOE/Day, so drill, complete, tie-in, cashflow, lots of work-overs, shut in wells, In field drilling locations, especially oil weighted that were shut during oil price collapse last year. Plus Noel well proves up that area and will add to overall production. 3) New website, promo material that highlights each asset area, etc is coming, they have been focusing as they should on integrating 3 companies into 1 4) they are in a black out for 4-6 for doing media appearances, dividend coming and q1 closing 5) They will consider hedging a % of production in future to lock in cashflow now that oil market has strengthened and basin differentials have compressed (smart move when you are paying a dividend) 6) Increases production will drive down unit cost, increasing margins. 7) no reserve split in the card 8) OTC listing after 100million MC us, so later in year most likely DOC's THOUGHTS: Being a new company nd a new dividend payer, I suspect as I have said before that the initial dividend will be conservative so they have room to increase it in 2H 2021 and beyond and to see what happens with prices/demand as we exit Covid restrictions. I think they'll come in at 5% yield though they could pay a lot more. On a Marco Level, If you have been following the rise of 10 yr interest rate, we are getting closer to intervention (suppression ) on the curve, meaning the FED will force rates down along with the US dollar index, this will cause energy prices to rise quickly along with the summer demand season, I see WTI hitting 75$ by mid summer, this will be very positive for the energy sector, especially Canadian producers whose fix cost are in Canadian $. There is lots to do and I3 is doing it. The infrastructure in place to support 30k/BOE/d on Gains portfolio in amazing, drill, tie-in, cashflow repeat until the company grows 3x in production, no long lags to build out infrastructure. They can achieve this just with the booked locations in field. Best of luck DOC

haha. Forgive me. FastFood

Freefood, since nov FCF increased 19 million USD