Member Info for tonynorstrom1

GGG,

I double checked - I made a slight mistake corrected below Tamarack has 125m bbl. The reserves are described as Proven and Probable.

Bonterra:
Tax Pool = $397m
MCap = UKP 56m
Production = 10,600 bbl/day
Net Debt = UKP 226 !!!
Reserves = 101m bbl
FCF = UKP 17m

Tamarack
Tax Pool = $859m
MCap = UKP 212m
Production = 23,050 bbl/day
Net Debt = UKP 163 !!!
Reserves = 125m bbl
FCF = UKP 26m

I3E
Tax Pool = $97m
MCap = UKP 42m
Production = 9,200 bbl/day
Net Debt = UKP 16 !!!
Reserves = 57m bbl
FCF = UKP 14m

The number show that I3 is trading at less than a third of the value of these two Companies based on EV/Flowing Barrel & EV/2P.

Also I3E is much less indebted than most of peer group companies. I3E's net debt is just over one years free cash flow versus, over 10 years for Bonterra and 7 years for Tamarack.

If I3E have there number correct - this has to rerate otherwise the laws of gravity no longer apply.

I took a look at some of the Canadian Peer Group Companies to compare some key Metrics:

Bonterra:
Tax Pool = $397m
MCap = UKP 56m
Production = 10,600 bbl/day
Net Debt = UKP 226 !!!
Reserves = 101m bbl
FCF = UKP 17m

Tamarack
Tax Pool = $859m
MCap = UKP 212m
Production = 23,050 bbl/day
Net Debt = UKP 163 !!!
Reserves = 101m bbl
FCF = UKP 26m

I3E
Tax Pool = $97m
MCap = UKP 42m
Production = 9,200 bbl/day
Net Debt = UKP 16 !!!
Reserves = 57m bbl
FCF = UKP 14m

Kanomine,

I respect fastfoods posts / opinions - asking questions does not mean I am undermining him which is not my intention and is not what I have done.

You on the other hand - no comment. What big claims have I made and what do you want me to back up ? I think you need to take a chill pill or alternatively put a chip on your right shoulder to balance the one on your left.

Fast Food,

Your arguments / theories are interesting and not ones that I’ve really heard before. One thing that caught my eye below was “ we are less that 30 years away from emergency reserves”. I’ve not seen this statement before - what’s this based on - do you have a link.

I have seen BP’s demand forecasts. They have 3 scenarios - under the bull case, demand is still around 90-100m bbl at 2050. In the bear forecast demand is somewhere near 30m bbl if my memory serves me correct. Then there’s a mid point scenario.

Fastfood,

Commitment I think is the wrong word since it is an opinion / guess. I will be very happy to see WTI at above 60, howvever, Baring an Iranian attack on Saudi, my opinion is that WTI will be less than $55, probably around current levels 52 and I would not be surprised if it dropped slightly below $50.

However, as Mirabauds analysis / report was based on $45/bbl (Brent) for 2021- the investment case is still in tact.

Dusterinmong,

Had I posted oil will be $95 by year end, SP will be 80p - no one would have questioned me and I would have probably got about 20 thumbs up.

The current POO is $55, consensus for this year and 2022 is $51. Goldman Sachs had a higher estimate , but this was from November before the latest Corona Virus news and lockdowns. Iran is currently under sanctions, OPEC have productions curbs, and US frackers are about 1m to 1.5m bbl below peak production due to current prices. Point is there are plenty of headwinds / variables and it is mugs game trying to predict the price of oil. In my opinion we’re not likely to see $95 any time soon and could easily go lower from these levels.

Kainoname,

Did you verify the % of oil used by cars - nearly 50%. Norway has banned the sale of petroleum powered cars by 2025. The U.K. and Europe have targets of 2030-2035 I think and I’m sure that the US and China will not be far behind.

You and Fastfood would have to paint a lot of houses to pick up this demand.

I wonder whether Warren Buffet would know the meaning of FOMO?

Kanomin,

I have never professed to being an expert - perhaps you can explain the link between FOMO and expertise in Oil ?

One piece of advice you should keep in mind is - always DYOR. Go onto the internet and type in “Oil Consumption by Sector”. No need to apologize when you discover I have not made up the figures.

Fast food

Flattery will get you everywhere !

Take a look at Oil Consumption by sector:

Road Transport = 50%
Aviation = 7%
Bunkering = 4%
Electricity Generation = 3%
——————————————
Total = 64%

Non Combustion
—————————
Petrochemical = 15%
Other Industries = 11%
———————————
Total 26%

All the combustion related uses will come under pressure from renewables / clean energy.

Carbon Capture Technology could change the dynamics of cheap enough.

I don’t bu the Oil conspiracy theory - imho it’s about climate warming, sustainability, clean air and cost.

But on the positive side - I3E’s SP is holding up quite well so far today compared to some other Oil plays.

Mirabauds estimates were run at $45 / bbl for 2021. Assuming that we average $55 in 2021 - that’s worth over 3p / Sh in additional cashflow which would put us on around 9p.

As far as a FO - its worth listening to the last 5 minutes of the Dec Proactive Investor virtual conference with I3E/Majid.

Dusterinmong,

Don’t confuse facts with negativity. Your posts would be more useful for all if you were to point out the errors / misrepresentations is my posts or indeed oth ers rather than general observations which in my opinion are not supported.

As far as an SP is concerned - there was a post on Twitter comparing metrics against Canadian Peer Group companies. I have not checked out the Companies so I have to take it with a pinch of salt as there are many posters such as Small Cap Picks aggressively ramping shares. However, taking the table at face value - I3E was trading at a half to a third of the value of the peer group.

A Company that I have looked at a little is Pharos Energy as this was identified in one of the reports as peer. Using this as a metric by my evaluation I3E should be trading at about 9 - 10p now.

Thank you Longfell.

Dusterinmong:

1) I’m a holder - does not mean I should ramp or indeed deramp.

2) You should bear in mind that facts/fundamentals will ultimately determine the success of I3E and not BB posts.

Luckyman,

My last post on pipelines - 30,000 bbl capacity is in the Canadian Network. The bottleneck is in the export lines to the US which impacts all producers as Oil is priced against benchmarks.

Dusterinmog,

1) I3E have already given guidance on the expected dividend i.e. 30% of FCF. The Mirabaud report estimates the 2021 FCF with certain assumptions including a POO of $45/bbl. Make an adjustment for the current POO and you should be able to estimate the dividend. It could be anywhere between the numbers you stated. I suspect though it is likely to be closer to 0.5p.

2) Transportation costs are not a "couple of bucks" - its about $4 to $5. Multiply by $9000bbl - that's quite a chunk of change. Markets try to discount all news so you need to run when you need to run.

anyway - I thought you were going to remind me what FOMO means !

Dusterinmong,

With respect - I dont think it has much to do with whether I3E expands or not - its about the ability to reduce transport costs which impact all exporters.

Whilst this do not impact current projections - this was certainly a talking point from I3E on future improvements to infrastructure and the possible improvement in revenues.

Ok - remind me again what FOMO means.

"no effect at all and production as normal. having extension keystone xl pipeline can boost productivity but cant see any changes without it."

No effect at all but can boost productivity - Contradiction?

Pipelines reduce the transportation costs of crude. Currently a portion of Canadian Oil is transported to the US via rail hence the discount to WTI. So clearly this impacts the ability to reduce transportation costs and will impact all producers who export to the US.

Oneshareatatime,

The 2p figure is rubbish and has been thrown out by rampers - multiply 2p by the 700m shares outstanding and you will see this equates to nearer 100% of free cash flow.

I3E have said they will pay out 30% of FCF.