Member Info for IBB_INVEST

Very well said Tony.

Didn't I tell you that Tony would disagree and come to defend I3 Energy's poor analyst coverage. Tony some responses below to your comments (you didn't 'debunk' anything BTW):

1. "Couple of things wrong with this Imo and you probably wont like to hear it – Canadians only make up 10% of the shareholding, 90% are UK i.e. UK Investors call the shots. Secondly, your assertion that that this is the reason is purely speculation on your part yet you spit it out as fact. I will touch on a couple of reasons in a later response to another poster who asked me this question."

Yes, of course Canadians only represent 10% of i3' investor base! This is a result of near zero analyst coverage for this company wherein 100% of their revenue comes from Canada! No revenue is generated from the UK yet 90% of our investors come from there. UK investors have little knowledge of the Western Canadian oil basin. There is something wrong that Canadian's are only 10%. This should be significantly higher for a company whose operation are in Canada! Again, this is because of a lack of analyst coverage and no marketing of the company to Canadian investors.

2. “There are a few small caps that are not included. When Peters & Co held a conference last year, the question was asked why i3e was not in attendance/presenting. The response from the Company was that Peters & Co typically follow the larger names only and / or Companies that use Peter & Co’s banking services. This does not include I3e but it certainly includes a few small caps such as Gear Energy that do use their services. You will see from a link that I’ll put out later that Gear Energy also trades at the bottom end of the valuation multiples – how can that be if the're covered by Peters and Co??"

Gear Energy is a terrible example of another company with a low valuation multiple. You are ignoring that Gear Energy is currently up for sale. No sophisticated investor or investment fund will invest in a company that is for sale where there is a high likelihood that it could get taken under. Not a good comparison to i3 Energy.

Peters & Co was just one of the examples I used. There are many other investment banks/ funds that hold events and conferences where small caps have the opportunity to present. Since following i3, I have yet to see them present once in Canada. Eg below:

https://schachterenergyreport.ca/about/conference-sandbox/

3. "I3e is covered by Canaccord Genuity Group Inc. who are a leading independent, full-service financial services firm with an international footprint and who by the way are headquartered in Canada with offices in London and elsewhere."

Canaccord is the only single Canadian coverage. i3' peers have 5x the coverage.

4. If anyone is interested in a proper response to IBB_Invests posts direct from the horses mouth– would suggest you copy it and email it into Investor relations.."

i3 Energy IR do not respond to emails!! I have emailed severals times over the y

Tony wont admit it nor agree but the reason why i3 Energy doesn’t trade at 110% of its PDP is because no one in the Alberta O&G industry has heard of us. Furthermore, a part from one Tier 3 investment bank, I: has no market analyst coverage. Peters & Co, the leading Canadian O&G investment bank doesn’t include us in their small cap charts. None of the big banks such as RBC, TD etc put out market notes updates either.

A year ago, Majid and Co said that there was progress in Canada on this and to stay stuned but it was all waffle. They made no improvement with Canadian analyst coverage and if things as they are with i3 operating in the shadows, they will remain valued at 30-50% to peers.

Thanks GGG. Historically, Alberta gas (which gets AECO pricing) was a regional hub with gas going to Canada and then some down to the states. Due to more gas production than demand (Canada has a low population) AECO gas pricing generally sucks. It’s about 1/20 (yes 5%) to European gas pricing and also discounted to US Henry Hub pricing.

The Coastal Gas Link Pipeline (CGL) that just completed will take gas from North East British Colombia to the Canadian east coast for LNG Canada. This combined with new US LNG facilities coming online for the next 3 years means that much of North American gas, including gas from Canada, will now be sent for North America LNG production. This is expected to re-rate North American gas pricing multiples higher closer to the $10 global average for gas. Henry Hub could easily form a base at $6-8 while Alberta AECO form a new base at $3-5. This is multiples higher than the $1.5 it’s currently at and it means a lot more cash flow for Canadian gas producers like i3 revenue. If the thesis plays out it will be a game changer. A similar situation happened in Australia a decade ago when it built its LNG terminals where gas was previously regionalized and now shipped abroad.

Pinecliff CEO Phil Hodge has a great Twitter space on this. Ask Tony for the link.

How can you be invested in a small cap Canadian natural gas producer to the tune of hundreds of thousands of pounds and not know what the Coastal Gas Link (CGL) pipeline is….?!?

Canadian reporting requirements are being enforced from Q1 2024 onwards. 2023 YE would not be required by today.

Don’t expect a dividend increase this year with AECO still in the gutter. Maybe 2025 if AECO forms a base at $3 due to North America LNG demand pulling gas from Alberta south and LNG Canada of course. Management has admitted that it was a mistake raising it so high. On the flip side if debt is paid off fully by EOY then that’s $20M in debt expense that technically could be used for increased dividend. IMO focus will be on growth instead.

Agreed. He is shrewd and prudent which I like. Unlike some of his peers they are used car salesmen ie Surge Energy CEO, Paul Coulborne. My only negative for Majid is the IMO the below average IR and analyst coverage efforts. I am hopefully that will improve with the new Canadian reporting requirements. I have nothing bad to say with Majid’s operational management nor financial skills. Excellent job at both in this low commodity environment. They are set up really well here for gas price recovery in 2025.

Although they can monetize some of their plays , with the new loan facility I am not sure that they will do this as those very valuable plays such as Simmonette are liquids rich. We will get a better picture of management’s view for what is core and none core soon when they issue their 2024 Capex and development plan. I think we will see more JVs than outright dispositions…

Agree. Thanks Tony for all you do here 🙏 Your reasoned posts are always a welcome when i3 was trading so low undeservingly. Most importantly though for keeping ‘Canuck da Divvy’ in check!

Tony, that is another catalyst the market has not considered at all. If i3 is debt free by the end of 2024, that $25M debt servicing cost is then free for a significantly increased drilling program (think oil wells at +$80 WTI) or an increase to the dividend. Certainly the base dividend will be sale beyond 2024. i3 will start to get interesting in late 2024 IMO...

We could speculate on news all day but I do believe that there is news coming in the next 2 weeks.

Many theories. My dream speculation is a land swap with $CPG who have very low decline (5-10%) legacy waterflood production up for sale in Saskatchewan. $CPG moved into the Montney 3 years ago and have amassed a huge land base & infra near i3’ undeveloped Simonette. $CPG said during their Investor Day this week that they want more Simonette Montney.

Would love to see a land swap with i3. Developed producing for mostly undeveloped

You are correct. Majority of profit is coming from oil production at this low AECO strip.

Oil is 25% of i3’ production but 50% of its revenue. Do not underestimate +$80 WTI and what it will do for i3’ coffers. My hope is that strong oil pricing carries the company to next winter where natural gas should be much stronger with LNG Canada coming online then.

Tony, will you come to Majid’ defence if shareholders do not get an update in March as promised? If there’s no March update will you admit that i3 has hopeless shareholder communication and an IR problem?

Thanks Tony, I mostly agree with your comments. Especially, in so far that Majid can’t control external factors such as natural gas price.

However, what he 100% can control is IR and especially i3’ relationship with the investment bank analysts. It is obvious that the stock price NEEDS analyst coverage. All of its Canadian peers get market notes from TD, RBC, Desjardins, National Bank etc. i3 have made ZERO attempt work on this during the quiet 2023/2024 pricing years. I don’t know if this is down to laziness or simple ncompetence but I do know that it would do wonders for the stock price.

There are few public investors left for small cap O&G companies and especially so when investor coverage does not exist for i3 whom are competing against $PNE, $JOY, $IPO etc and all of those names get coverage by the banks.

I don’t think Majid cares much TBH. He is earning £600K a year and gets cheap options for “running” a company from his kitchen table on the other side of the world. Oh and he has a Canadian President that runs the show in Canada. Majid dusts off the old slide deck, gets a train to London and does an “investor presentation” twice annually. Easier O&G CEO gig in the world. All for £50K / month pay. Daylight robbery.

The last 2023 AGM was in June so I do not think it’s the AGM. Perhaps they have been approached to be taken over? Who knows.

Tony, ask yourself why did both parties go through all the effort to transact on i3’ one Clearwater well in Martin Creek. It is very likely that i3 are in the process of selling their Martin Creek acreage to Tamarack Valley, $TVE. Recall last week RNS where company stated that they are in the process of disposing certain non-core assets and that they will update the market in March on this.