Mid and small cap Oil & Gas stock portfolio?

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CynicInvestor
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Mid and small cap Oil & Gas stock portfolio?

Anyone has suggestions on building a small/mid cap international energy portofolio of stocks (20-30 stocks max?).

What are fellow turdites holding in the energy sector?

Edited by admin on 11/08/2014 - 06:18
Seacap81
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WTI

WTI

ReachWest
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STP

This is an Oilsands one I have .. not performed well lately (but that's more attributable to broad market sentiment). I believe a solid longer term hold. 5000 Bpd existing production and a major project is in construction phase. Here's a bit of background to get your DD underway.

  • Company website is here.
  • Recent article in the local paper, here.
  • Research from BMO is here.
Zwipped
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MVW.V

Mountainview energy was a stock some guys talked about at the previous site. I went up hard and smacked down hard as well. Maybe this is a buy at these levels???

GoldistheFuture
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Mart Resources (V.MMT)/(MAUXF)

Mart Resources is trading below their cash flow at $0.57 a share.  Most undervalued oil play in the market.  They are producing around 8-10k bopd as of now and they are expanding their pipelines to hold 30k bopd which should be completed by year end.  If their drill results for their UMU-8 are excellent then this will quickly move over $1.00.  They will be announcing their Q1 results any day now.  The only reason they are not trading at 5X this price is because they are in Nigeria.  But the plus side is that these 10-30k bopd are light sweet crude which trades at a huge premium.  Do your own DD and good luck!!

http://www.martresources.com/wp-content/uploads/2010/06/28/corporate-presentations/updated_corporate_Wade_Angela-v3-1.pdf
 

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GoldistheFuture
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BUY NOW!! ($0.54 a share)

Mart has dipped because of the debt ceiling issue and this is 3-4 weeks before a pipeline deal, UMU8 test results(which could be an additional 6-8,000 bopd) and Q2 earnings (which are going to be amazing)will all be announced by September!! WOW! trading at 1 X cash flow, will have all debt paid off and are working with Shell on a mega deal. This is by far my largest holding and they will be at least a 5 bagger by year end!!

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boil_in_the_bag_rice
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What makes you so confident

What makes you so confident that they'll reach a pipeline agreement with AGIP?

Aren't AGIP holding all the cards?

GoldistheFuture
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Not really!

AGIP controls the pipeline but if they don't make the deal with Mart, then Mart will either deal with Shell (Which is in the process) , or eventually build their own pipeline (and with the amount of cash they are bring into the company and proven reserves, it would not be difficult to get the loan).  Mart is meeting with AGIP today and something will be announced by next week.  I just added more today.  To me the risk is very low as long as you don't mind holding until they figure out how to ship the oil.  They will be producing over 18,000 bopd of light sweet crude (by the end of September) that is selling for a premium even over Brent Crude.  So to me this is by far the most under valued company I have ever found.  The big boys are just trying to squeeze them but they have the oil and it's only a matter of time before they figure out how to transport it all.

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Donnybrook Energy DEI

This is a good time of year to be looking at Canadian energy stocks, drilling season not far off. My most recent purchase is Donnybrook Energy (V.DEI). They have a good land package in the Montney and have partnerships with Celtic Explorations (T.CLT) and Cequence Energy (T.CQE). Been watching it for a while, had a good run earlier in the year and has come back a bit, probably a case of too much too soon, plus summer never seems to be kind to Canadian energy stocks. Cequence is a long time holding and is worth a look, great management. I don't own Celtic but wish I had, well run growing company, fairly high price now.

GoldistheFuture
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Mart Resources Record Earnings!!

WOW!! Look at these numbers.  If Mart was not in Nigeria this would be a $7 stock and it trades at $0.48. So undervalued.

http://finance.yahoo.com/news/Mart-Announces-Record-ccn-2334160804.html?x=0&.v=1

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I like the service companies,

I like the service companies, and hold Gasfrac which has a liquid propane frac technology that is quite promising. It has come a long way down recently, I'm really tempted to add more. I got in mid $6 and rode it up to $13 and all the way back down to around $8 again. Apart from the majors like ENB, CNQ, TRP and SU, I've tended to swing for the fences with my small caps in the energy sector, so I've currently got Atikwa, Pennant, Petroamerica warrants, and Rockbridge. None of them are winners for me at this point.

Sparkenheimer
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Former Canadian Energy Trusts

There are many Canadian energy companies that were once income trusts which are on sale right now. For those not familiar I will elaborate.  Most converted late last year due to a change in regulations, the twist with these companies before the change was that the unitholders paid the tax to the government rather than the trusts themselves, mosts trusts paid a large portion of their revenues to the unitholders. As a lot of the unitholders held these trusts in retirement accounts and the government was losing tax revenue big time, something had to change. Almost all were required to revert to a corporation before the beginning of this year. I will focus on three of the ones that I hold shares in and have been adding to lately. All have dividend yields in the plus 7%  range right now. Daylight Energy (T.Day) has a little more than 200 million shares outstanding and is a favorite of Irwin Michael who runs ABC funds and is a value guy who usually ends up on the right side of a trade in the long run. I have been interested in the company ever since they bought Highpine in 2009. They are about 60/40 oil and gas with the option to go more oily if required. They have a good land package with many prospective drilling sites in good locations and currently produce about 37K BOE per day. Another interesting one is NAL Energy (T.NAE), they have about 150 million shares outstanding and produce about 27K BOE per day. This is similar to DAY and has assets in Alberta and Saskatchewan. Both have the potential to increase production and both have reasonable debt levels, the dividend payouts are monthly and appear safe while oil is in the 80 dollar range. My last pick is Penn West Petroleum (T.PWT) with 470 million shares outstanding and about 170K BOE per day. This is a much bigger company and has a large land package across western Canada. It pays a quarterly dividend. All of these have good cash flow at $80 oil and if the price of natural gas rises they will be that much more attractive and all trade at book value or less. This whole sector is very cheap right now and there are a lot of interesting companies to look at,

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This is a good forum subject

.

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This is a good forum subject

This forum ought to deserve alot more interest.  A list and discussion of oil stocks, oil service,juniors,seniors,  so much   interest out there in the investing world..... but not so much here in Turdland.

I have my weak eye on Bakken stocks...... but most are still too expensive.

I like BEXP but not at current prices. There was a correction  this summer down to around 22....still too expensive. I'd like BEXP but at 15 dollars. Maybe when /If the world collapses into another crash...it will be time to load up on Bakken oilers. Why? probably because the world will shun the USA and shut us out  from global oil. We will have to  start using our own. Alaskan oilers will be the next bonanza in such a dark post economic crash, or economic world war, if not a shooting war, or escalating global chaos that passes for  WW3.

But like Einstein said about WW3....... "I dont know what weapons will be used to fight WW3, but I can promise you that WW4 will be fought with sticks and stones..." 

But even still.....buying BEXP at 15 would be a sweet bargain.

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ONR

If you want something less than $1 billion maybe take a look at Open Range Energy Corp.

Company has refocused from exploration to servicing. Could be quite a cash cow.

But DYODD here and check out their info:

http://www.openrangeenergy.com/investors/events-presentations/index.aspx

Most recent presentation:

http://www.openrangeenergy.com/_pdfs/ONR-2011-Powerpoint-Sep-21.pdf

Current market cap: $C600 million.

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What about Magnum Hunter now

MHR has plunged  well  below 3 dollars now and heading toward 2 dollars. Do you think it might be worth 2 dollars a share?

and how bout Whiting Pete (WLL)  its price has collapsed way down from where it was.

Sparkenheimer
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Galleon Energy

I am currently looking at Galleon Energy, GO on the TSX.  I have owned in the past with moderate success. Great land package with not so great management. New management has arrived, (former founders of Penn West Energy) and I think good things are starting to happen. There has been a lot of insider activity in the past month with most of the buys coming from management and Sprott Resource Corp. Sprott owns about 18% of the company right now, and my personal opinion is that Sprott's organization does not just gamble on a stock, they do their homework. Share price is extremely cheap now, although has had a small pop recently as many of these stocks have after the takeout of Daylight Energy (which I am fortunate enough to be holding) by the Chinese. Not a ton of shares outstanding, about 85M and reasonable debt, about 150M with asset sales pending that will reduce the debt. I think I last sold at $7 and it's now trading around $2.50. They are about 2/3 gas and 1/3 oil right now with the emphasis on oil going forward as most companies are these days. They are currently at about 12000 BOE/day. The name will be changed to Guide Exploration next month. Worth a look.

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Pennant Energy

One of my juniors, Pennant Energy (PEN.V) has popped 200% from 0.10 to 0.30 in the last three days based on a nice news release that came this morning regarding their Montney play at Bigstone. This is a potential company maker for such a small cap exploration name.

VANCOUVER, BRITISH COLUMBIA, Oct 20, 2011 (MARKETWIRE via COMTEX) -- Thomas Yingling, President of Pennant Energy Inc. CA:PEN +51.28% , is pleased to announce, pursuant to our September 28 press release it has been informed by the operator, Donnybrook Energy Inc. (Donnybrook) of Calgary, that the Bigstone, Montney Formation horizontal well, Donnybrook HZ Bigstone 14-29-60-22W5, has been successfully completed and flow tested. On October 12th, a 240 ton, 12 stage continuous fracture treatment along the 1254 meter lateral leg of the well (horizontal portion) was carried out over a 6 hour period. Immediately after, the well was flowed for cleanup and subsequently flow tested for approximately 4 days and is currently shut-in for built up. The well, after clean-up, produced gas and condensate over the last 24 hours of the test at approximately 4.3 million cubic feet per day (mmcf/day) and 295 barrels per day (bbls/day) of condensate (1011 barrels of oil equivalent per day, boe/day).

The 14-29-60-22w5 well has tested at comparable or better rates to a well located approximately 5 miles to the south which was drilled and completed in a similar manner (1200 meter lateral with 12 stage frac) and tested rates of (3.5 mmcf/day and 225 bbls/day of condensates; 808 boe/d). The operator of that well has offset the initial test with 2 longer horizontal wells with 2000 and 2538 meter laterals at locations about 4 miles south of (1 mile closer to) the Bigstone 14-29 well. The 2000 meter lateral section tested at rates of 13.1 mmcf/day and 655 bbls/day of condensate (2,840) boe/day). The 2538 meter lateral section tested at 15mmcf/day and 600-900 bbls of condensates. (3100-3400 boe/d).

The Donnybrook HZ Bigstone 14-29-60-22w5 well confirms the Montney formation at Bigstone is at least comparable or possibly better in reservoir quality to the Montney that has been drilled at Fir 4 miles to the south. Accordingly, longer 2000-2600m lateral sections at Bigstone should produce a similar increase in results with test rates anticipated to be 3 to 4 times higher than the 14-29-60-22w5 well has achieved.

Thomas Yingling, President of Pennant Energy Inc., stated, "the Bigstone well has clearly exceeded our expectations. The Bigstone/Fir Montney area resource development potential has attracted a significant amount of attention in recent months, not only reflected in the current and planned drilling activity in the area, but also in the high land prices paid ($6,300/ha) at recent Crown sales Pennant's 25% W.I. in 1792 ha of contiguous lands at Bigstone represents a potential drilling inventory of 13-27 development locations depending on the length of the horizontal leg of each well. We are looking forward to developing this exciting project with our partners."

Based on the reported production performance of longer lateral wells to the south at Fir and the quality of the Montney reservoir section encountered at Bigstone, Donnybrook has informed Pennant that it is planning to drill a longer 2000-2200m lateral as the next well in the project.

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Gasfrac Earnings Up 116% in Q3

Nice pop the last few days on strong earnings. Have been in this one before it moved to the big board.

Dwight Loree, Chief Executive Officer commented "I am pleased to announce that revenue in the third quarter increased 116% to $57.4 million as compared to $26.6 million in the third quarter of 2010. Further, EBITDA increased to $11.0 million from $4.9 million and net income to $5.9 million ($0.10 per share) from $2.3 million ($0.06 per share) representing increases of 125% and 155% respectively.

Late in the quarter we signed a long-term contract with Husky and began operations under that contract in the fourth quarter. We anticipate that this contract will initially utilize two of the four sets of equipment currently in Canada and expect more sets will be required as work under the contract expands.

During the second quarter two sets of equipment were mobilized to GASFRAC's operations in Texas. Since that time we have performed fracturing operations for several companies in a number of different formations, including a six week project in Colorado. Revenues from US operations have grown consistently each month from $0.6 million in May to $12.9 million in October.

GASFRAC also announced the appointment of senior oilfield services executive Zeke Zeringue as the company's Chief Executive Officer. Details of this appointment and Mr. Zeringue's biography are contained in a separate press release issued today

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Guide Exploration (Galleon Energy)

I'm glad to have purchased this last month, it's had a pretty good run. Name changed to Guide Exploration, still trades as GO on the Toronto Exchange. They just reported 3rd quarter results which were in line with expectations, revenues and production. They are actively drilling biasing toward oil with 14 oil wells drilled last quarter compared with 3 gas wells. The company is currently 1/3 oil and 2/3's gas and have rights to about 700K acres in good locations including Duvernay, Montney and Peace river arch.  They recently did a share offering of about 7 million shares (the majority flow through) at an average price of about 3.50. I'm not usually a fan of dilution, however with the fairly low share count existing and the feeling that I get that this will be money well spent, my concerns are small at this point. I have found with junior energy companies that the most important component is management; and this is experienced management. If they've done it once, the odds are good they can do it again given the right assets. I don't know if this is coincidence but they recently bought back a lot of shares at lower prices and issued at higher prices, not something you see much of. Another one worth a look is RMP Energy, RMP.T, again it has good management, this is that groups 4th company. I'll talk about this one on my next post.

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Atikwa (V.ATK)

Spearfish well (Williston Basin) flows 267 barrels/day. Should see some action tomorrow. Atikwa is also involved in the Roncott area in SK for light sweet oil, and in AB at Porcupine Hills and Windfall for liquids rich natural gas. Share price has been languishing around 5 or 6 cents for quite a while though.

CALGARY, ALBERTA--(Marketwire - Jan. 30, 2012) - Atikwa Resources Inc. (TSX VENTURE:ATK) ("Atikwa" or the "Company") is pleased to report that it's 7-34 well is flowing at initial rates of production of 267 barrels per day of fluid, with an oil cut of 50%, which translates into over 133 barrels of oil per day. The Company expects that the oil cut will continue to increase over the next week or so as the water based fracing fluid is recovered and replaced with oil. In addition to the 7-34 well, the Company's 13-23 well has just gone on production and the final well in the program, the 0-26 well, is awaiting the installation of a pump jack.

The Company now has 8 Spearfish wells in the area, 5.3 net and expects to exit this round of drilling with net oil production of over 400 barrels per day. Assuming a drilling density of four wells per quarter section, the Company has 21 (net) additional locations in the area for future infill drilling.

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