All posts tagged Joint venture

Imperial Metals Corp

English: 100 million dollar note after operati...

English: 100 million dollar note after operation Sunrise. Issued 2nd May 2008. (Photo credit: Wikipedia)

III : TSX : C$10.91
BUY 
Target: C$16.50

COMPANY DESCRIPTION:
Imperial Metals is a Canadian-based company with interests in two mature producing copper mines in British Columbia (Mount Polley [100%]; Huckleberry [50%]). More importantly, the future and value driver of the company resides in its 100% interest in the very large but undeveloped Red Chris copper-gold project in northwest BC, which is permitted and scheduled to enter production via an open-pit in late-2014.
All amounts in C$ unless otherwise noted
Q1/13 FINANCIALS IN LINE; STILL WAITING FOR RED CHRIS FINANCING
Event
Imperial Metals reported Q1/13 EPS of C$0.14, in line with both our forecast and consensus. We calculate adjusted (to include Huckleberry)
EBITDA of C$23 million vs. our forecast of C$25 million. The end-Q1 cash balance was just C$97,000 (excluding III’s C$12 million share of
the Huckleberry JV’s cash balance).
Impact
Our 2013-15E adjusted EBITDA forecasts (accounting for Huckleberry as an equity investment) are C$100 million, C$116 million, and C$330
million.
Action and valuation
We are maintaining our BUY recommendation, but decreasing our 12- month target price from C$17.00 to C$16.50, based on the average of: i)
10x our 2014E EV/EBITDA, which would imply a share price of C$10.55; and ii) our NPV10 estimate of C$22.13. Our NPV10 estimate of C$22.13 includes C$12.15 for Red Chris in-situ value.
Next potential catalyst and investment risks
Red Chris financing remains a key valuation risk, and in our view a potential catalyst for share price appreciation. Our current valuation assumptions are C$100 million of equity priced at C$10 per share, and new debt financing of $400 million at an interest rate of 10%. On this basis, we are forecasting an end-2014 cash balance of C$41 million

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by jackbassteam on May 17, 2013  •  Permalink
Posted in Base Metals
Tagged , , , , , , ,

Posted by jackbassteam on May 17, 2013

http://amp2012.com/2013/05/17/imperial-metals-corp-2/

RAY SMITH PRESIDENT AND CEO OF BELLATRIX EXPLORATION – update

Sunset in Central Alberta

Sunset in Central Alberta (Photo credit: HandsLive)

RD:  Ray, where are you at for production right now?
RS: We exited the year at 19,500 barrels equivalent so for four consecutive years we have met our guidance for annual and we have met our guidance for exit rates. We expect to average around 20,000 for the first quarter plus or minus and continue to grow as we go through the year and
target end of the year at over 31,000.

RD: How much of that is oil and liquid rich?
RS: It’s all oil and liquid rich. We are staying on the liquid side between 32% and 35%, depending what is on and what’s off on any given quarter. We don’t expect that to change much. But what we are drilling is hugely profitable, whether it contains gas or not. So for example the Notikewin/Falher play in Central Alberta using new technologies that we are using on our latest group of wells, have been giving between 6 and 8 BCF per well or coming  on at 12 to 15 MCF/day with 35 barrels per million of liquids. These wells are producing in the first 90 days of production a BCF of gas. The finding costs are $0.60, the lease operating costs are $0.60 – that is $1.20 all in and our liquids alone have recovered $3.25. Hugely profitable.

RD: All I ever hear is Alberta Oil and Gas – no one interested. What do you say to those investors?
RS: I think a lot of that has to do with the overall energy market, the fact that a lot of companies have balance sheets getting in distress which has caused the companies to start selling assets and reduce values. We have had a weak gas environment in North America and western Canada is predominately a gas market, but there are only a few gas plays that are still drillable at these weak gas prices that have a great rate of return. So it’s like saying I don’t like cars anymore

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by jackbassteam on February 18, 2013  •  Permalink
Posted in Alberta, Energy, Oil
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Posted by jackbassteam on February 18, 2013

http://amp2012.com/2013/02/18/ray-smith-president-and-ceo-of-bellatrix-exploration-update/

Bellatrix Exploration

Bellatrix Exploration

(BXE : TSX : $4.67)

Bellatrix has entered into a joint venture (JV) agreement with an unnamed South Korea-based company, to accelerate development of company’s extensive undeveloped Cardium land holdings in westcentral Alberta. Under the terms of the agreement, the JV partner will contribute 50%, or $150 million, to a $300-million JV to participate in an expected 83 Cardium well program.

Under the agreement, the JV partner will earn 33% of Bellatrix’s working interest in the Cardium well program until payout (being recovery of the JV Partner’s capital investment plus an 8% return on investment) on the total program, which is expected to occur prior to a maximum of seven years, reverting to a 20% working interest after payout. The effective date of the agreement is April 1, 2013 but with the ability of the JV Partner to elect to invest in the wells drilled between January 1 up to April 30, 2013.

Certain conditions precedent are expected to be satisfied or waived by April 22, 2013 which is expected to enable closing to occur on or before April 30, 2013. Bellatrix will be required to provide a guarantee of the return of the JV partner’s capital investment of up to $30 million if not recovered within seven years. As a result of the JV, Bellatrix’s net capital expenditure plan for 2013 is expected to increase from the previously announced $180 million level to between $230-240 million not including JV Partner capital. Based on the timing of proposed expenditures,
downtime from anticipated plant turnarounds, completion of anticipated infrastructure and normal production declines, execution of the increased 2013 capital expenditure plan is anticipated to provide average daily production of 24,000 to 25,000 boe/d.

The company is anticipating a 2013 exit rate of 30,000 to 31,000 boe/d. Bellatrix’s second long reach horizontal well (50% WI) drilled in Q4/12 has been placed on production at the following rates for IP30 rate of 944 boe/d (25% gas and 75% liquids).

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by jackbassteam on January 24, 2013  •  Permalink
Posted in Energy
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Posted by jackbassteam on January 24, 2013

http://amp2012.com/2013/01/24/bellatrix-exploration/

Encanna and Devon – Joint Ventures LNG

Devon Energy Center under construction, from t...

Devon Energy Center under construction, from the northwest. (Photo credit: Wikipedia)

Encana* (ECA ) :  $19.60

Encana  announced yesterday that it will look to accelerate the commercialization of its oil and liquids-rich plays through joint ventures (JV). ECA talked about this at the LNG Summit in Singapore

 

The JV expectation is already in the marketplace given it wants a deal similar to the $2.5 billion JV Devon Energy (DVN) struck with Sinopec (SNP) , which involved:

 1) SNP to reimburse Devon for drilling costs incurred prior to closing and acreage acquisition costs incurred subsequent to the effective date of the agreement;

 2) SNP to make a $900-million cash payment upon closing and $1.6 billion paid in the form of a drilling carry. The drilling carry will fund 70% of Devon’s capital requirements, which results in SNP paying 80% of the overall development costs during the carry period;

 1) Based on the current work plan, Devon expects the entire $1.6 billion carry to be realized by year-end 2014;

 2) Devon will serve as the operator and will have ultimate responsibility for the allocation of capital. The company is also responsible for commercially marketing all production from these plays into the North American market. Devon said it had tremendous interest during its data room process, and

 ECA will experience the same level of interest. The acreage across the Tuscaloosa, the Utica/Collingwood, the Eaglebine and the Mississippi Lime was quoted in the press release to be ~ 1.2 million net acres, which is larger than the ~900,000 net acres we were estimating in prior research.

Given ECA’s large acreage position,  it can do a JV of similar size to the Devon/Sinopec deal. He updated the Devon/SNP JV implied value across the JV targeted acreage of ECA on a 100% basis.

 ECA plans to host an investor day on June 21 to highlight its resource potential within its oil and liquids-rich plays.

 

 

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by jackbassteam on April 3, 2012  •  Permalink
Posted in AMP, AMP Book, Bakken Shale, Drilling Companies, Fracking, LNG, Natural Gas, Oil
Tagged , , , , , , ,

Posted by jackbassteam on April 3, 2012

http://amp2012.com/2012/04/03/encanna-and-devon-joint-ventures-lng/

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