I3 Energy Share Discussion Threads

[muddyfox0151] 12/3/2021 08:21

From LSE ValuationToday 08:11Folks, new to the site, good to be here, anyways, here's a low end case for ITE, add these up:1. 90% Farm-out of UK Offshore Serenity Project, ~15MM cash in hand + NPV 281 MM @ 25% discount rate2. Marten Clearwater Cold Flow Heavy. 1 billion OOIP. Recoverable approx. (120 MMbbl). Valuation of Marten creek is $120 MM CDN 3. Valuation of Conventional Production is $15,000 per flowing barrel equivalent... so another $150 MM. 4. Valuation of undeveloped conventional acreage is $60 MM. 5. Valuation of unused tax credits is $94 MM. 6. Valuation of 3rd party processing and royalty streams is approx. $20 MM.7. Current debt approx. -$40 MM CDNAs such, in total, conservatively... ITE is worth $700 MM CDN or 5.88 x current market cap. $1 CDN/share. The catalyst for this realization will be driven by higher WTI/WCS crack spread due to higher diesel and JP blend demand during the recovery. WCS will be driven higher as the LVGO/HVGO fractions are really quite ideal feedstocks for this purpose. The bitumen fraction of WCS is rich in these. Higher bitumen demand will dictate higher steam demand from the SAGD operations which have been operating in efficiency mode for quite some time now. Higher steam demand by these operations will drive up the AECO gas price significantly... I'd expect to see $3-5 AECO soon and we won't be looking back with the Dems restricting their own new US oil production which also produces (via solution gas) 1/6 of the 30+ BCF they burn each day. And then we also have to consider the imminent replacement of all the coal fired power plants with Natgas combined cycle units. It's really quite the perfect cascading storm setup for the likes of ITE. These prices will drive up the valuation of the oil assets. I wouldn't at all be surprised to see $1 CDN / 0.57 PPence share price before the end of the year.

[tonynorstrom1] 11/3/2021 19:39

Ziblot,

Thanks for the explanation. I dont think it matters how and when the interest is paid - the calculation for free cash flow I think is still the same i.e. with interest and finance charges deducted. If the Company has options to pay off debts differently - then I guess the "calculated" FCF is a notional number for reference purposes only. If you refer to Mirabauds reports - this is how they have calculated FCF and hence the dividend.

Still im not sure how this "Payment in Kind works". Are you able to explain it ?

thanks

[inever] 11/3/2021 18:40

When you place an order and ask for a quote and you accept it that will be shown as a buy (in blue).If you place an order for X at a limit of say 9p and that gets filled that will be shown as a sell (in red)In both cases you are buying but ADVFN shows them differently.The transactions you are showing are buy orders at a limit price. They are filled but ADVFN records the seller selling rather than the buyer buying.

[spurs90] 11/3/2021 17:42

I’ve double checked the correlated times and they’re all either equal to or above the ask at their time so imo they’re buys!!! Would explain the price action today!!

Date Time Trade Prc Volume Buy/Sell Value
11-Mar-21 15:15:45 9.40 2,000,000 Sell* 188.00k O
11-Mar-21 08:48:53 8.90 2,500,000 Sell* 222.50k O
11-Mar-21 08:34:42 8.946 2,500,000 Sell* 223.65k O
11-Mar-21 08:45:52 8.90 2,500,000 Sell* 222.50k O
11-Mar-21 15:14:43 9.40 1,400,000 Sell* 131.60k O
11-Mar-21 14:44:54 9.20 2,000,000 Sell* 184.00k O
11-Mar-21 15:41:05 9.60 1,000,000 Sell* 96.00k

Check for yourselves!!

[spurs90] 11/3/2021 17:41

I’ve double checked the correlated times and they’re all either equal to or above the ask at their time so imo they’re buys!!! Would explain the price action today!!

[spurs90] 11/3/2021 17:38

I’ve double checked the correlated times and they’re all either equal to or above the ask at their time so imo they’re buys!!! Would explain the price action today!!

[csmwssk12hu] 11/3/2021 17:31

The close doesn’t make sense and will no doubt be corrected in the morning, up another 14% in Toronto to 0.21, converts to 11.97, some serious upside there if it holds that, let’s hope in rises more imho dyor

[spurs90] 11/3/2021 17:22

More than 11million in delayed trades now showing!!

If someone was offloading that amount I doubt it would have risen throughout the day!!

[spurs90] 11/3/2021 17:15

Lol!!!

Crazy stupid old man lol!!!

[d1nga] 11/3/2021 16:56

They missed at liberator but looking likely serenity may be farmed out at some stage in the future its more likely to get to a deal with Andrew Austin out of the picture, too many egos in one room I suspect in previous discussions.

[ziblot] 11/3/2021 16:39

Go back to school and gain a proper command of the english language, you silly delinquent.

[spurs90] 11/3/2021 16:35

Ziblot I’d give up if I was you!! You have been wrong with every call if people had listened to you they wouldn’t be up 100%!!

[showmethemoneyhoney1] 11/3/2021 16:28

Point taken. I'd take anything GH says with a pinch of salt but Majid has always come over well. Although I'm out, pleased to see this do well for you all :-)

[ziblot] 11/3/2021 16:25

D1NGA. Come on, where was it incredibly bad luck? They were presenting everything as tho' it had been discovered; in other words they couldn't miss. History tells different. They paid for the Dnx discovery but gave it up as not commercial. Did they miss or not? There's a chance Serenity might get a farm in but I wouldn't hold my breath believing the west of Serenity holds the expected oil. Liberator will never be drilled, why should it when the funds can be better used to better balance the Canadian assets.

[jungmana] 11/3/2021 16:06

Nice move today and long may it continue. Imo we should be at least GBP 100m market cap ( 15p)

[csmwssk12hu] 11/3/2021 15:51

Volume today 10 times higher in first hour of Canada trading than normal whole day, something going on?

[ziblot] 11/3/2021 15:45

The Toscana final payment was paid. Graham confirmed.

[ziblot] 11/3/2021 15:36

Looking at the Jim Jones write up, I feel as tho' I should apologise to these two toe rags. Is it not Majid writing under an alias. Its old news but it's done the trick.

[ziblot] 11/3/2021 15:24

Tonynorstrom:. FCF is with interest deducted - EXACTLY.
Who says otherwise. GRAHAM HEATH.
I emailed and asked had they paid the interest which is at 8% and if they hadn't how would they satisfy the debt when it matured in 2003. He said they were "paying in kind". Rolling the debt would be a default and incur additional costs. "The H1-2019 LNs have a term of 4 years, maturing on 31 May 2023 and bearing interest, payable on a quarterly basis at the Company's option (i) in cash at a rate of 8% per annum, or (ii) in kind (at i3's option) at a rate of 11% per annum by the issuance of additional H1-2019 LNs". A Capital Distribution in the way of a dividend does not give reason to roll a maturity date which would then incur a higher cost for that loan! Their is no reason not to pay interest when it comes due. This comes before any dividend.
Corporate Governance, comes to mind.
Good to see some movement in the share price

[d1nga] 11/3/2021 15:04

Showme, yh they had incredibly bad luck with liberator, they were leaky as a leaky thing. But its a different business now and there is money to be had here....

[loafingchard] 11/3/2021 15:00

Show Me This is not the same proposition as the one you invested in when it was just north sea explo.

[showmethemoneyhoney1] 11/3/2021 14:56

You have clearly not met them.

[richie32] 11/3/2021 14:53

I bought a few of these earlier in the week. I don't normally buy at the top of the chart (for recent times that is) but I think the management is really switched on here.

GLA

[neo26] 11/3/2021 14:43

100m mkt cap minimum, 10kboepd production, 2p reserves 58mmboe. Div yield gonna be 10%-15%.Nice

[spurs90] 11/3/2021 14:42

Copied from lse

My pleasure: Key things to watch to model cashflow

It's worth saying this. I think what many failed to realize in the Uk is that ITE isn't just an exploration company anymore but a production/ developer with a North Sea exploration arm, the bulk of the company is production. They are producing 10000/BOE/d at a blended realized price of $35-40 USD = Rev for 2021 $172 Million, very different evaluation models, price/FCF price/dividend yield price/PDP price/NPV-10 on P1-2. Cashflow means dividends, maybe buybacks and no more dilution that explorers in all resource areas are known for.

Things to watch to model cashflow:

1) Price of Edmonton Sweet Oil (priced wit - Edmonton Sweet differential currently about $2, meaning they get $63USD for each barrel) They bulk of their current oil production is this

2) Price of WCS oil (heavy oil. priced wti - WCS differential, currently $12 ) = $53 USD

3) exchange rate of Can $=USD. What's great is their fixed cost mostly are paid in cheaper $can and they sell in USD

4) Price of Alberta Natural Gas, C5, NG Liquids

5) With now over 80 Million BOE in reserves, watch for whatever remains of their old debt to be refinanced with a first lien credit facility at half the interest rate, their Net debt is about 20 million Can$ I think.

Pace of Clearwater development. 400% Irr's, at current price amazing

So it's not a high risk exploration co now, it's a low risk producer with a multi decade investor of drilling locations and the upside of discovery in the North Sea, gravy. It's. manufacturers process now. Drill, Complete, flow, tie-in, repeat... use goggle to find the current differentially. Best Doc