Member Info for tonynorstrom1

Tamarack Valley provided their 4th Quarter highlights (not results) on the 31st January and included reserves update - so no reason why i3e should not be issuing its update next week.

Took a look at Tamaracks 4th quarter results and compared adjusted funds flow as a ratio of market cap - by my rough numbers it looks to me that i3e still only attracts only half the multiple of Tamarack despite i3e's strong run up over the last week. I compared i3e's chart with Tamarack and a few others over the last year- the recent run up has put us on par with a few of our peers with relation to SP appreciation but has done nothing to close the relative valuation gap. I would expect to see a further run up in the SP as i3e appears to be finally gaining market recognition and this is not considering any earth shakers such as a Serenity announcement or a large drill program in South Simonette or further acqisition which could cause us to gap up.

News expected next weeks:

1) update on the sale of gas rights on inactive wells to third party
2) reserves update
3) NOI update
4) Drilling update - how many new wells have they spud - 4 or 5?
5) Work-over update on the 60+ targets they previously identified
6) They previously spoke about some water flooding / enhanced recovrry trials they had been doing but this is 6 months back - maybe we hear something about this.
7) Serenity - I personally don't expect a farmout just yet based on the update from Tain but i would expect them putting a firmer timeline on it now that they are on the cusp of having the funds to go solo on a single appraisal well.
8) Will they pull a rabbit out of the bag like last weeks dividend RNS with something totally unexpected ?
9) Oh - i nearly forgot - GGG's financing facility !!

GGG,

Stop your rant - admit you don’t know it all and enjoy your profits.

Take a proper look at my spread sheet - understand the numbers -I’ll help you . Hey and enjoy the profits!

Flabby - completely academic because debt was not available.

“Plenty can still go wrong” - Could you kindly elaborate and perhaps highlight the top 5 risk say?

I think now we can all agree that GGG’s theory on massive dilution was way over played and I had it right all along !

I also don’t think a development is 5 years away. Tain for example were looking at production 3rd quarter this year - that looks like it may have slipped but certainly not by 5 years. Serenity is theoretically piggy backing on Tain so I would have thought 1st oil within a couple of years.

You really think a mention by you on this board is going to cause a gold rush on your graphite shares - really ?

I think you need to be a bit more generous than that - after all you did at one time throw out NCCL as a tip. I think you owe this board one because of that - come on - what are your Graphite Picks?

GGG,

With my world famous spread sheet - if I plug in an additional 15,000 bopd of oil (Majid said that Serenity could produce at 30,000 ). Then I get an SP of 55-88p on CF multiples of 2 & 3 at current Oil prices. This ignores Minos High. So obviously a long way away and no guarantee of the reserves or indeed the development capital - but goes to show that there is a potential path forward to achieve that kind of Market Cap / SP !

i'll add graphite to my list - do you have a name ?

well you hold your coal - I would suggest that:

1) Nat Gas
2) Oil
3) Copper, Zinc

and some other plays will be more profitable than Coal in the long run. On my barbie - I prefer logs anyway to coal !

took a quick look at your posting history - looks like you were into Advance Energy also - hope your Coal Play works out better !

i3e has lots of Oil & Gas - no guessing and likely to be around alot longer than coal.

Good luck with your Coal !

Run Forrest Run !

There was an article on OilPrice.com in the last few day talking about the rise of production in the USA specifically from frackers. This is kind of obvious - who isn't looking at expanding production in the current pricing environment. However, I truly believe i3e is in the sweet spot:

1) i3e's opex and cost of production is far less than US frackers and so can operate in a much lower price environment.

2) i3e's carbon intensity is far less than US frackers or Canadian Oil Sand - if ESG pressure ratchet up - logic says that the highest carbon intensive fossil fuels will be under the hammer first - coal, tar sands, US frackers, heavy oil etc.

3) I posted yesterday a dividend projection for i3e in a $55 & $2.50 Oil and Gas world and the payouts were still very significant which should support a decent SP.

I think the market is only starting to appreciate i3e - if the Management Team continue to execute , the SP should be considerably higher in the coming months.

EV per flowing barrel and per 2P reserves is very misleading - gas generates about a quarter of the revenue of Oil on a per barrel basis so gas weighted stocks should quite rightly be valued significantly lower than oil weighted stocks. The disparity is so large I would say these metrics are meaningless as no two companies production mix is the same. i3e produces about 22% oil, another company maybe 30% and another 80% - so how do you compare on these metrics.

I think a much more meaningful metric is EV/CF or EV/FCF. This strips out all the nonsense about gas v oil and purely looks at the cash generation / profitability which is the primary aim of most companies.

The good thing is that i3e is cheaper than most on these metrics. Even with our recent up - my estimate indicates that we are cheaper than any company in Eric Nuttals Portfolio of Canadian Companies. We would have to climb to about 18-19p to get to the same valuation as the cheapest Company in his portfolio and about 28p to get to the most expensive based on these CF multiples.

MORNING COMMENT
i3 Energy

Changing to Monthly Dividend – Increasing Valuation on Rising Commodity Prices i3 Energy announced it is changing to monthly dividend payments, which we believe will be well received by the market because it underlines the company’s commitment to returning cash to shareholders. Independently of the change to the monthly dividend, we are increasing our fair value estimate for i3 Energy to reflect rising energy commodity prices. Our new fair value estimate is 37p, up from 35p. The company’s Canadian operations now account for 30p of our fair value estimate (from 28p).

Monthly Dividend: i3 Energy announced that going forwards it will make a monthly dividend payment. Consistent with its prior statements, the company reiterated its commitment to pay a minimum total dividend of £11.827m over the course of 2022 – 1.05p/sh, representing a yield of 7.1% (based on yesterday’s closing price). The 2022 dividends will be paid in 10 equal instalments the first of which will be announced mid-February for payment in March, according to the company. The company stated that its board will continue to monitor the quantum and scheduling of future distributions. We believe the change is a reflection of the degree to which i3 Energy is committed to returning cash to shareholders and we expect the change to be well received by the market. We note that the monthly dividend will appeal to investors looking for regular income while facilitating a smoothing effect for investors seeking to use the dividends to fund reinvestments in i3 Energy shares.

WHI fair value estimate: We are increasing our fair value estimate to 37p from 35p to reflect rising energy commodity prices. Specifically, we are increasing our WTI crude oil estimate for 2022 to $82.89/barrel (from $80/barrel) and our 2022 benchmark US gas price to 3.86/mmbtu (from $3.75/mmbtu). Please see our updated valuation table in Table 1.

And the good news keeps on rolling in !

I think good news for investors and should support the SP - a good piece of thinking outside the box by the BOD imo although i'm sure some will find cause for complaint.

Just to demonstrate how progressive and secure the dividend should be - I plugged in $55 and $2.50 (Oil & Gas Price) to see what would happen if there was a bit if a down turn - if i3e slashed Capex to $12m just to cover maintenance and increased the payout to 40% (which they have discussed before) - then they could still payout this dividend and have cash left over to cover debt repayment. Quite a margin of safety and not many company specific risks short of an accounting scandal.

I don't know what the confusion is - the RNS is quite clear, the monthly dividend will replace the bi-annual dividends:

"As previously announced, during the course of 2022 i3 will pay a minimum dividend totalling £11.827 million........................ This dividend will be divided and paid in 10 equal increments."

the only thing that isnt clear is record date etc which im sure will be addressed when they announce the first monthly dividend in the 2nd half of February.

Austin,

I think its clear that this RNS just covers the dividend and Q4 update still to come. A bonus really - they are confirming that the assets are exceeding expectations and I’m sure they will elaborate in the update. Nothing to complain about in my opinion.

Some balmy posts on the AVFN board calling it mad - what’s not to like as an investor. Demonstrates confidence in the cash flows and we get our money earlier.

Will be interesting how the market reacts - I would have thought positively !