Approximately 60% of my capital is invested in O&G sector, and 30% in Silver. With that said, I feel that I’ve allocated enough in the O&G for now; I’m not going to chase, but will continue to buy the dips. Oil equities rally significantly in Nov and Dec, so I’ll be watching on how this sector recovers in 2021.
Currently, I’m holding #TXP, #UOG #PTAL and #FEC in the O&G sector. I think #PTAL and #UOG will catch up in 2021, while #TXP and #FEC will continue to rise. It will be a bumpy recovery in my opinion.
Meanwhile, I’ll be working my 9-5 job and saving cash. I want to look at private investments in start ups in the years ahead for personal interest and diversification.
Working 9-5 isn’t my thing as it’s boring as f**k. I would say 50% of the time I’m dealing with politics and corporate agendas which I have no interest in. I would love to share my thoughts with my peers and coach my staff, but to survive in the corporate world, you have to play the game and never share your personal agenda or opinion.
Oil Supply and demand should balance out in Q2 2021 though we could see a balance as soon as Q1 2021.
In the past 2 weeks, we’ve seen a rise in O&G equities, and to me, this is exciting — but seems like all too soon for my liking. I’d like to build up a bigger position first.
Frontera Energy ($FEC.TO) is one of my favorite companies since it should NOT be valued at ~280M CAD. See why here. Frontera share price rosed from a low of $2.02 on Nov 6, 2020 to $2.90 on Nov 23, 2020 – 0.88 CAD increase or 44% up in 2 weeks!
Have the Oil Bull market begun? No, I suspect the rise in O&G equities recently is led by short term investors and traders. There will be slight pull backs for us long term investors to buy in.
Be patient, buy on pull backs, and don’t chase all the way. I admit, I chase a little due to FOMO. Typically, I chase with small buys, and buy big on pull backs in this market.
Corentyne block leads are very close to discoveries such as Pluma and Haimara. In the map below, areas in green are oil discoveries, and areas in red are gas discoveries.
ExxonMobil’s run of success continued with its 10th Guyana discovery on 3 December 2018. The Pluma-1 well found 121 feet (37 meters) of oil-bearing sandstone, on trend with other discoveries in Guyana’s Cretaceous sandstone play. The discovery, along with appraisals, adds 1 billion barrels of oil equivalent (boe) of discovered resources.
Pluma is located 42 miles (67 kilometres) southeast of Liza, and Wood Mackenzie estimates the discovery holds 300 million barrels of oil equivalent (mmboe) of recoverable resources,
The other discovery was at the Haimara-1 well, which encountered approximately 207 feet (63 meters) of high-quality, gas-condensate bearing sandstone reservoir. The well was drilled to a depth of 18,289 feet (5,575 meters) in 4,590 feet (1,399 meters) of water. It is located approximately 19 miles (31 kilometers) east of the Pluma-1 discovery and is a potential new area for development.
The Maka Central-1 well was drilled by a water depth of about 1,000 meters and encountered more than 123 meters net pay of high-quality light oil and gas rich condensate net pay, in multiple stacked reservoirs in Upper Cretaceous Campanian and Santonian formations.
WoodMac has said based on its estimate Maka Central-1 contains 300 million barrels of oil, 150 million barrels of condensate and 1.4 trillion cubic feet of gas. According to a report from GlobalData, the discovery has the potential to bring more than US$50 million in revenue per year to the Surinamese Government if it sees similar success to Guyana’s Stabroek Block.
The Sapakara West-1 well was drilled by Apache using the Noble Sam Croft drillship in a water depth of 1,000 metres and encountered a 79 metre net pay of high quality light oil and gas condensate in multiple stacked and good quality reservoirs in Upper Cretaceous Campanian and Santonian formations.
According to Apache, the preliminary fluid samples and test results indicate at least 79 metres of net oil and gas condensate pay in two intervals. The shallower Campanian interval contains 13 metres of net gas condensate and 30 metres of net oil pay, with API oil gravities between 35 and 40 degrees. The deeper Santonian interval contains 36 metres of net oil-bearing reservoir with API oil gravities between 40 and 45 degrees
Kwaskwasi-1 encountered at least 912 feet (278 meters) of net oil and volatile oil/gas condensate pay across two intervals – Campanian – 282 feet (63 meters) of net oil pay and 86 meters of net volatile oil/gas condensate pay, and Santonian – 129 meters of net hydrocarbon pay.
ODL $22.3 million USD for six months ended in June
BIC $17.0 million USD for six months ended in June
Puerto Bahía
For the six months ended June 30, 2020, the Company recognized $22.3 million as its share of income from ODL which was $6.2 million lower than the same period of 2019 primarily due to a decrease in the transportation tariff in 2020 and the impact of foreign exchange fluctuations. During the six months ended June 30, 2020, the Company recognized gross dividends of $24.5 million which were declared and paid by ODL.
For the six months ended June 30, 2020, the Company recognized its share of dividends declared by Bicentenario totalling $17.0 million. As at June 30, 2020, the carrying value of dividends receivable from Bicentenario on a discounted basis was $49.7 million ($56.6 million undiscounted).
Is the company really worth $228.41M CAD (today’s market cap)? NO – they are worth more. I have no idea why there are 9 million shorts. Something seems fishy, but I’ll be buying and buying…
I actually like FEC’s Guyana prospect a lot. FEC has 81.3% Economic Interest two blocks in Guyana: Corentyne and Demerara! FEC has 72.41% interest in CGX Energy and 33% stake in each block. I believe Guyana is still a hot spot for offshore drilling.
Corentyne block
Given that Carapa-1 hit oil, I believe there is a high likelihood that Corentyne will also hit oil; though it will depend on FEC’s execution.
Corentyne’s cretaceous layer may be just like Carapa-1 and contain high quality light oil.
Demerara block
Given that Joe-1 and Jethro-1 from EOG had oil discoveries in the tertiary layers; I’d expect Demerara to have similar results. I’m not particularly interested in high sulphur heavy oil as heavy oil will be more expensive to process than light oil.
FEC currently valued at ~293M CAD and CGX Energy is valued at ~160M CAD today 8/12/20. This means FEC’s equity stake is worth 112M CAD and everything else FEC owns is worth 181M CAD today.
This gets me thinking – is everything else FEC owns worth only 181M CAD?
