Criterium Energy Ltd (TSX-V: CEQ): New drilling expected to start in September
• A drilling rig is scheduled to be mobilize on site in August. The two-well infill program, targeting a previously undrilled section of the MGH Field, is anticipated to commence in early September with the wells expected to come on production in early November at a forecasted combined rate of 300 bbl/d.• While this is a bit later than we anticipated, we continue to forecast that Criterium will exit 2024 with ~1,250 boe/d production.
• The programme is expected to cost only US$4.5 mm with payback in less than 6 months.
• Following the strong performance of the first work-over campaign in early 2024, Criterium has launched a second campaign of five new work-overs in late July. To date, two workovers have been completed and early indications are that production levels exceed internal expectations of ~ 30 bbl/d per workover.
• The remaining three workovers are expected to be completed by mid-August.
• Completing the divestment of Bulu for US$7.75 mm by the end of August remains a key event as this would either allow the company to reduce its debt and/or accelerate its drilling programme.
• Further progress on the onshore gas development is another key area of near term potential value creation.
• We re-iterate our target price of C$0.35 per share in line with our ReNAV.
Valuation
Our Core NAV and ReNAV are unchanged at respectively C$0.23 per and C$0.33 per share.
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.
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