Valeura Energy (TSX: VLE): Positive drilling results add production and probably reserves
• Following the drilling of three new wells at Manora, field production has increased from 1,950 bbl/d prior to the first well coming onstream to a recent average of 2,626 bbl/d—this is ahead of the company’s expectations. We have raised our 1Q26 production forecast for the field from 2,000 bbl/d to 2,200 bbl/d.• The MNA‑41 appraisal well has validated the prospectivity of key reservoir intervals. It encountered oil pay within the 300‑series sand, opening up additional exploration and appraisal opportunities, and intersected five oil‑bearing zones within the 400/500‑series reservoir. The results also exceed the company’s expectations and may allow decommissioning activities to be deferred. The well has now been brought into production.
• We are increasing our target price from C$14 to C$15 per share. This reflects a higher chance of development for the 1 mmbbl Manora contingent resource, which we have raised from 50% to 75% following the positive drilling results. We have also increased our 2026 Brent assumption from ~US$69/bbl to ~US$74/bbl. Several upcoming catalysts are not yet reflected in our valuation.
Reflections on Thailand’s fuel security measures
Recent Thai government decrees restrict exports of four key refined fuel products—gasoline/gasohol, diesel, jet A1 fuel, and liquefied petroleum gas—while leaving crude oil exports unaffected. Thailand’s refiners import the majority of their crude feedstock from the Gulf, which means securing barrels has now become a strategic priority. In this environment, Valeura may choose to prioritise domestic demand to ensure stable refinery utilisation. During COVID, when crude availability was abundant, barrels were sold at a steep discount to Brent. The current tightness in supply creates the opposite dynamic: scarcity could support crude being sold at a premium.
Valuation
Our valuation reflects Brent assumptions of US$75/bbl in 1Q26 and US$80/bbl in 2Q26, with our long‑term forecast of US$70/bbl unchanged. Under these price assumptions, we estimate that the company’s net cash position will be broadly equivalent to its current market capitalisation by 2030. Assuming a stronger oil price environment—US$90/bbl from 2Q26 through 4Q26, followed by US$70/bbl thereafter— would see our ReNAV rise to approximately C$15.50 per share.
Valeura Energy is engaged in the exploration, development and production of petroleum and natural gas in Turkey and Western Canada. As of Dec 31 2010, proven gross reserves for light and medium oil was 116 thousand barrels (net reserves of 104 thousand barrels); proven gross reserves for heavy oil was 10 thousand barrels (net reserves of 9 thousand barrels); proven gross reserves for natural gas was 1,047 million cubic feet (net reserves of 938 million cubic feet); and proven gross reserves for natural gas liquids was 26 thousand barrels (net reserves of 19 thousand barrels).
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.