Member Info for tonynorstrom1

Extrapolated / Guestimated from 3Q guidance, latest presentation and the remaining wells to be brought online - hopefully wont be to far out.

https://1drv.ms/b/s!AoSqKfvcR4IMgYMs4WgLII_sN20TsQ?e=Sq5cT1

Attached partial cut from my spreadsheet - projected 2022 final results a full 4 or 5 months before the Company publishes them. Just talking through a couple of numbers:

1) Highlighted numbers in yellow top left are assumed although the AECO and WTI prices are averages through 17 November. Numbers for previous months in H2 are actuals.
2) NOI for full year is $176m could be up to $180m or slightly higher if Oil and gas prices improve over those highlighted in yellow. I3e's projection should be bettered unless the POO collapses in the final month and a half of the year.
3) Column headed NTM is basically the December production and prices forecast for the next twelve months - in this scenario i.e. Oil $85, production 24,731 boepd - NOI for the next twelve months I estimate to be $190m
4) Current dividend as a percentage of Decembers FCF is about 52% i.e they are currently paying substantially above the 30% of FCF as i3e define FCF with their current Capex Spend. So in order to maintain or increase the current dividend next year- they will need to reduce the Capex budget or change their pay-out policy.

They will need to spend about $30m in order to maintain production flat next year so I would expect a minimum Capex budget of say double this - half to replace declines and an additional $30m plus to increase production 2000 -3000 bbl. Of course it all depends on the POO/ACECO Prices to set their final budget.

"the fact we produce ~4 times more gas than oil means the AECO gas price is more important than the oil price."

1) In Dec we are likely to produce about 5500bopd of oil and condensate and about 12,000 boepd of gas - so just over twice on a per bbl basis - 4x ???

2) At todays prices and Decembers forecast production Oil makes up about 43% of sales and Gas about 35% - so oil is still the most important part of the production mix.

Nomad,

As has already been discussed - its an uplift on the cumulative dividends paid out in 2022 - but not on the current monthly dividend. The presentation could hardly say much else as any material news must be issued via RNS and not presentation. I expect that the dividend will reviewed before the end of the year in conjunction with next years planned Capex Budget.

Ive done the Calc’s - Toad and I will post a little later today - I had to recreate the spreadsheet from scratch due to a bitlocker issue.

I also have forecasted H2 and full year results including NOI which I think should be pretty close to actual.

Forecasting the dividend is a little trickier because of I3E’s unusual FCF calculation - They calculate FCF after deduction of Capex - so you can only approximate next years dividend once you know next years Capex Budget. Would be much more transparent and better imo if they were to do prior to deduction Of development Capital - same as many other Canadian Oilers and inline with Eric Nuttall.

Yes - where is McSelfish - I used to enjoy his expert insight.

Danger Mouse - I think most agree that net zero is an important issue.

But if your looking for kindred spirits here who enjoy glueing themselves to Picasso’s or handcuffing themselves to the railings outside of No 10 - then your on the wrong forum.

Danger_Mouse,

In the context of being an investor and wanting to maximise returns - neither of your posts make any sense to me.

I3e has no experience in Wind Farms so if you want to invest in Wind Energy or renewables - you’re invested in the wrong Company although it must be noted that I3E do have a program to reduce the Carbon Intensity of its operations.

Why would you want to focus on gas which attracts about $25 per barrel v Oil at $80 currently in Canada - makes no sense financially

Another very positive and notable take away from the presentation is the increase in Oil & Condensate as a proportion of the production mix. Referring to the chart on slide 6 - Oil & Condensate is now up to 25% up from about 19% only a short few month ago.

Also look at the graph on slide 9 - Oil & Condensate is 35% of the mix from the new wells drilled this year.

Since OIl is x2 the price of NGL's and approximately x4 the price of Gas on a per bbl basis - this is significant for revenue generation.

I'll forecast the dividend later today based on these new production mixes and increased production. People will need to bear in mind that WTI is now just over $80 / bbl compared to an average of just over $101 in H1 but still these production levels and increased Oil makes the dividend more sustainable / secure.

I'm not sure of the reason for drilling more non-operated wells than planned and less operated wells - would be an interesting question to ask i3e - why dont you send them an email ?

One thing to note is that this is the first time we have heard of a Capex budget of $88m - previously it was "up to $97m "(initial $47m plus an additional $50m). So it looks like a trim in the budget to me from what the envisaged 6 months ago when they announce the expanded capital plan. Makes sense as I think the program has probably met their objectives for the year plus the $97m was set when Oil prices were higher.

Also - its just a projection - does not mean they will not review at the end of year . As per an earlier post - I think the increase in the base dividend if any will be in the range 0-5% with the possibility of a bonus dividend / buyback.

Is there a better time than the present to buy back a few shares with the SP close to 6 month lows.

The presentation is very good and I would expect a very positive presentation from Majid.

I don't want to burst anyone's bubble - buts its the same monthly dividend as we have now - run the numbers ! There's even a note to that effect on the same page !!

But great presentation - highlights the growth opportunities ahead and confirms to me that the current SP weakness is totally un-justifies relative to peers.

08 - approval to issue up to 20% additional shares. This is a listing requirement that the Company must get shareholder approval before issuing new shares. This authority lapses after a certain time - not sure whether it is every year or every couple of years - but it needs to be renewed. Also they just issued a bunch of shares for Serenity so probably used up previous allowance.

09 - approval to issue above shares on a pre-emtive basis which means that existing shareholders must be given the opportunity to participate in and share issuance / rights issue.

10 - Up to 10% of the 20% of shares in 08 above can be issued on a non-pre-emptive basis i.e. existing shareholders may not be given the opportunity to participate - for example if the Company deems it necessary to deals with selected Investors / Institutions which may or may not be already invested.

So all good and remember - it could be a lot worse - you could have bought into EOG like me for exposure to Serenity - no Jam yesterday, no Jam today and no delivery date for Jam in the future …..and some of us paid In advance years ago.

You cannot be getting 100 jars of Strawberry Jam a month and be asking for another 20 without growing more strawberries. They’ve only just planted more which we are told will bear fruit in the next month or so - so patience required.

Hell if we’re all good boys and behave ourselves - we might even get a few bonus jars at the end of the year !

"The whole 'jam tomorrow' story with this company has been going on for years." I just dont understand this comment at all - if you pull up the one year chart - the SP has moved up from around 11p to 22.5p whilst at the same time i3e have been paying out handsome dividends. That's quite a bit of Jam.

I3e were one of the first Companies to resume dividends, certainly in the Canadian Oil Sector and were about the 1st if not the 1st to go to a monthly dividend - in addition, they have raised the dividend once already this year - so the whole Jam tomorrow story doesnt sound all that fair to me.

There you go Mongoose !! - that’s what many of the quality names in the Canadian Space are pledging to do !

I wonder what the next news is - we need something to perk the interest up - since 24,000 boepd was set as a year end target - you would think that they would announce that when it happens - perhaps a November production update.

Serenity was a bit of a Dodo - so would be a pleasant surprise for anything to come out of that - I would think Majids London assignment depends on it. Around $20m in SG&A - around half in UK costs - mainly Salaries , bonuses, office rent and the like - bit of an extravagance if they have no UK production or reserves. for that matter.

GGG,

They have provided shareholders certainty upfront - they announced what the minimum dividend would be for the year back in February I think - you cannot get more certain than that. They also stated that they wanted to pay it at a sustainable level (up to 30% of FCF)as part of an overall a balanced shareholder return (Dividends + Capital Growth). In fact they stated this over two years ago when the formed the Canadian part of the business - so consistency as well as certainty.

Have you emailed the company to tell them your views ? I for one am reasonably happy with the way they are running things. Of course its always easy to play armchair quarterback and say they should do this or that - but generally they seem to have got things right.