Member Info for tonynorstrom1

Oilman Jim makes a lot of daft statements.

Looks like Oilman Jim's (Louis10) subscriptions are heading down - no wonder, much better Market Commentators out there - who would pay for that sh@te - really !

Shubham Garg is presenting the following seminar on the 30th April - "Alaska Oil Production History, Overview, and Future Outlook"

Worth Watching imo. He has a stake in 88e so im sure he will provide comment on both 88e & PANR. If your watching the Seminar live you normally get the opportunity to ask questions.

https://www.whitetundra.ca/events

Some great information here including on pipeline projects that will increase egress capacity to markets outside of the US and hence improve Canadian oil and gas prices.

https://www.capp.ca/explore/oil-and-natural-gas-pipelines/
https://twitter.com/sohaibab9/status/1646638754533343233

A couple of good research pieces. The Surge Video gives you an idea of other types of acreage in Canada - one of Shubhams top picks and this video pretty much explains why.

https://1drv.ms/b/s!AoSqKfvcR4IMgYNgpDc3Nno_j5C4HQ?e=YP***N
https://www.youtube.com/watch?v=cABYWqAHM2A&t=1851s

Not sure everyone got to see this since you had to sign up for it but the video is now on youtube:

https://www.youtube.com/watch?v=AM_HoLLGxH0

Serica Energy reported today - founded by the same people that founded i3e. Looked like pretty decent results. One thing that caught my eye was the 2P reserves of 75m boe - puts i3e's into some perspective at 184m although Serica have just completed a major acquisition which bumps 2P to 120m boe (still less than i3e although it will take production to over 40k boepd - cash is king !)

GGG - to answer your previous question on the value of i3e based on reserves / acreage (other than NPV10 values which are in the report) – Oil Companies in the current market are being valued primarily based on cash flow though as we have seen recently – high quality acreage is attracting high prices. A couple of pertinent quotes from the recent WHI report:

“Admittedly, the public equity market in North America is looking through the reserve estimates to some extent and valuing high quality land in some instances without it being ascribed 2P reserves (for example, i3 Energy’s peer Headwater Exploration would fall into that category)”

“…… the discounted NPV10 (before tax net cash flow value) of the 2P reserves amounts to $1,161.5m ……. For reference, we have imposed a much more conservative valuation methodology in our assessment of i3 Energy’s value, applying a 5x multiple to its 2023 cashflow, ………. the 5x multiple we have chosen is significantly lower than historical norms (and the company’s fundamental value strictly speaking…). Our multiple reflects current market conditions”

A couple of other interesting things to come out of the reserves report and Majid’s recent interview:

1) Only a couple of wells currently planned to be drilled in the Clearwater this year – seems strange given i3e’s significant land position and that Clearwater is one of the most economic oil plays in North America. I think that Majid hinted at it in his interview – lack of nearby infrastructure "requiring careful planning" as to where and when to install the necessary pipelines and processing facility capacity. This needs to be in place in order to bring new wells online.

2) The same could be said for Simonette – particularly South Simontte. Also, very interesting that they chose not to drill more wells in the Montney since they performed so well and have instead opted to target two different formations (Dunvegan & Wilrich) to “evaluate the properties” . Seems like preparation for a farmout !

I saw a comment on the CEO/CA board – “……….i3e’s Clearwater Acreage is unproven…” – I would have to say I agree with this and it also probably applies to Simonette. I think the market needs to see more well results before it can be determined exactly how good i3e’s acreage really is. I3e have had some decent results from the few wells they have drilled in the Clearwater but not in the same league for example of some of the wells drilled by Baytex. So, more work to be done by i3e – which they are doing!!

Misleading people - ripe coming from you Jim !

Tamarack Valley (EV/PDP = £27.7/boe)
(RLI 2P = 10.3 yr, RLI PDP= 3.2yr, PDP = 75.7m boe, 2P = 242m boe, Liquids= 82%, 64k boepd, CW = 734 net sec, EV=£2.1B)

Headwater Exploration (EV/PDP = $47/boe)
(RLI 2P = 5.2yr, RLI PDP = 2.5yr , PDP=16.6m boe, 2P = 34m boe, Liquids= 88%, 12.8k boepd, EV= £781m)

Cardinal Energy (EV/PDP = £9.17/boe)
(RLI 2P = 14.7 yr, RLI PDP 10yr, PDP = 77.6m boe, 2P = 113m boe , Liquids= 91%, 22k boepd, EV=£712m)

Surge Energy (EV/PDP = £16.8/boe)
(RLI 2P = 13.4 yr, RLI PDP = 5.1yr, PDP= 44.6m, 2P = 122m boe , Liquids= 85%, 24k boepd, EV=£750m)

I3e (EV/PDP = £4.16/boe)
(RLI 2P = 22.5yr, RLI PDP = 6.8 yr, PDP 49m boe ,2P = 184m boe, Liquids= 51% , 23k boepd EV=£204m)

cmcc4394,

Apologies for the delayed response, in order to comment on how good or otherwise the reserves report is, I think you need to compare against peers – refer to the numbers I put together below. These were the companies highlighted by WHI in their last report as the peer group – I added Surge Energy to the group. Tamarack & Headwater are held in Eric Nuttals fund and Surge is Shubham Gargs top pick so I would say they are amongst best in class.
So, these are my observations:

1) Relative to its size - i3e’s 2P reserves at 184m boe are substantial with an RLI of 22.8yr and only just behind Tamarack at 242m boe which is a considerably larger company, however Tamarack has a much smaller RLI of 10.2 yr. Bear in mind that there are some companies such as MEG that have considerably higher 2P RLI’s but I would say not too many. So i3e compares very well against the peer group and probably very well against the sector as a whole.

2) If you refer to WHI’s report – they calculate i3e’s EV/2P at $1.40 / boe versus $15.73 / boe for the peer group i.e. about 1/10th the peer group. You need to bear in mind that the peer group are oiler meaning that each boe is worth about x2 that of i3e at current gas prices, however, even allowing for this, it still indicates that i3e’s 2P reserves are valued at a fraction of its peer group. I have included this ratio based on PDP reserves below which shows i3e in an even more favorable light.

(EV = enterprise value and is basically Market Cap adjusted for debt – so the above ratios are telling you how much the market are valuing each barrel of oil)

3) I3e’s reserve replacement ratios were also very good - 176% (PDP basis) & 479% (2P basis) meaning for every barrel produced they are replacing it and adding a further 0.76 bbl (PDP) and 3.79 bbl (2P) to reserves i.e. not only can they increase production significantly year on year but will still be adding to reserves for quite a few years yet.

4) There are some nuances here including but not limited to unbooked drilling locations which are not included in reserves. Headwater for example have the worst numbers based on the above metrics but are one of the highest rated Companies on a EV/CF basis – why – because they have over 400 sections in the Clearwater play which as most know have the best economics in North America and it is lightly booked. Good news is that i3e also has a decent land position here along with Simonette and also Wapiti which i3e stated surprised to the upside which you can see from the well results and also why i3e are drilling so many wells there.

Bottom line is that i3e’s acreage is considerably undervalued and should start to be recognized as such by the market , I believe this will correct over time and also probably means as some have suggested here that i3e could well be a take over target (imo – do your own research)

Continued Part 2

The other factor that they did mention is that there will me a major shutdown of some shared facilities for maintenace - I forgot which Q and this will remove around 500 boepd and despite this - still forecasting yoy growth of 10-13%

What you not taking into account:

1) Seasonality of Capex and consequently when new wells are brought on line ( discussed by i3e in their recent podcast with Ryan Heath and Majid). Majority of capex is spent in Q3 with the production coming on stream in Q4. Q2 has virtually no capex spend so production declines in Q2 & Q3.

2) New wells have a decline rate of 30% or more in the 1st year. So to do a meaningful comparison - you need to make like for like comparisons eg 2022 average v 2023 average, Q1 2022 to Q1 2023 etc

If you do that - then you see the guidance given by i3e is correct

You dont think it's anything the do with filling the vacant CFO role ?

https://www.share-talk.com/malcys-blog-oil-price-san-leon-arrow-energy-europa-oil-gas-angus-energy-petro-matad-i3-energy-finally/

"This extensive reserves report shows how well i3 have been doing and whilst I wouldn’t normally comment on such things way out of my training but shareholders will be impressed."

So that was Malcy's take .

There’s always one party pooper who won’t let the facts spoil a good ruse.

Talking of ruses - While you are here - perhaps you can explain how the appointment of a CFO and release of the reserve report means the for sale sign is up?

I appreciate all posts including negative posts if they are factual, well thought out and you learn something something from - did your post tick those boxes? Anyway , have a good weekend to !

anyway - any holders of Jersey Oil & Gas here - pretty nice jump up so far today !

Makes you think what might happen to our Serenity Partner if they manage to make progress on a farm-out of their Irish Gas Project.

GGG,

Voting is only pointless because PI's like you thinks its pointless - so your partly responsible for that...... and I gave an example where PI's did appear to vote in numbers and the CEO has now gone.

I have to say I still agree with Olderandwiser that they dont need to ramp up debt and / or issue further equity - they've just come of the back of a $90m capex program and drew down cash to do so and are no longer net debt free - so pretty aggressive already in my eyes particularly as they have been very proactive with bumping up the dividend (market leading I may add) .

Lets says the POO does not pick up as expected and gas price goes negative as Nuttal suggested "could" happen in the short term and at the same time they add on an additional $30m in debt - suddenly the financials look a little less comfortable - so I agree with Olderandwiser that i3e have got the development plan just about right - no need to be gambling to much on the POO.

Jezzoo - we didn't say the same thing at all unless the words are twisted - being late is not the same thing as not turning up !............and being frustrated is not the same as not caring or giving a stuff !

Jezzoo,

I disagree with just about everything in your post:

1) there's always room for improvement in PR , issuing of reports etc but I believe they do keep investors including PI's informed and they do engage with PI's or at least the ones interested enough to send them an email. Graham Heath spent a lot of time responding to PI's including probably over 20 emails from me over the years. Majid also responds to emails.

2) And yes many PI's think the only thing they can do is whinge on here - but that's not correct - you can contact the Company and you can also vote during the AGM's - unfortunately many chose not to. A great recent example is the last AGM at our Serenity Partner - Europa Oil & Gas. A lot of PI's voted and 76% of investors chose not to re-elect the CEO and low an behold he retired a few months later with his tail between his legs.

So stop whinging please and more emails and more voting !!!!

Have to say i agree with isdeer also - not delivering results when you say you will deliver them is extremely frustrating for investors and i3e are repeated offenders and a lot of it has come from Majid himself. I should have added it to my email of shareholder gripes !