Parex Resources12 Dec 2017 15:48
Is our immediate neighbour to CPO-5, with 55% interest in the prolific block Llanos-34 block. Apparently they are the best performing resource stock on the Canadian index since the oil crashed below $100/barrel - that's according to an article attributed to Bloomberg.
I just proves that Colombia is not a killer for a company's share price and it is possible to do very well - so what's up with Amer apart from a significant seller(s) depressing the SP? IMO the only real problem aside from locality is management consistently missing targets and not getting a grip. If they do so, even simply setting targets they can achieve is a start, then I think the other problem will disappear very quickly. Extract from article:
"... the benchmark index’s top-performing, post-crash energy producer — Parex Resources Inc. — is a small company focused on extracting one commodity from one geographic region. Parex is one of only four stocks in the 50-company S&P/TSX energy index that have gained since July 30, 2014, the last day oil closed above US$100 a barrel.
The gain by Parex shows how investors have taken a liking to small producers who focus their operations in one region and aren’t too adventurous with their capital spending. While their diminutive size may seem like a disadvantage in a business dominated by behemoths, being small allows producers to provide investors with a clear picture of their plans and to wring out costs that larger operations can’t avoid.....
“They’re just more focused, more focused on costs,” said Ken Lin, an analyst at Paradigm Capital in Calgary. “In a lower price environment, the lower cost operator is the better operator.”
Parex, based in Calgary, produces oil in Colombia through both new wells and by reactivating old fields using enhanced-recovery techniques. The company also held assets in Trinidad & Tobago when it was split off from Petro Andina in 2009, but sold them to focus on its more promising Colombian operations. The shares have gained 11 per cent since oil slipped below US$100. The broader energy index has slumped 33 per cent.
Driving Parex’s gain has been a debt-free balance sheet and an ability to increase its reserves and production entirely out of its cash flow, said Lin, who in a recent note nominated Parex as perhaps “the best oil and gas company in the universe.”
Chief Executive Officer David Taylor said that the company will continue to focus on Colombia, rather than try to transport its expertise elsewhere.
“We know how to do business here,” Taylor said in an interview from Bogota, where he spends four to six weeks a year. “We have a very strong team here, we understand the geology. Why would we change what we want to do?”
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Some of the statements actually also describe Amerisur, I think perhaps the management need to get a grip of things and start driving the co
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