Panoro Energy ASA (OSE: PEN): Northern flank at Hibiscus estimated to hold 8 12 mmbbl reserves
• The northern flank at Hibiscus, appraised by the DHIBM-7P pilot vertical well, is estimated to hold 8-12 mmbbl gross reserves (Panoro WI: 17.5%).• This is above our early estimate of 8 mmbbl.
• The well was drilled from the pilot hole of the recently drilled Hibiscus South well that had already encountered 5-6 mmbbl recoverable resources in a north-east extension of the field.
• Overall, 13-18 mmbbl reserves have been encountered so far this year at Dussafu, suggesting a very high reserve replacement ratio at YE24.
• The current rig operation is to complete a production well (DHBSM-2H) at the recently proven north-east extension of the Hibiscus South field. A production well will be drilled in the northern flank of Hibiscus later this year.
• We re-iterate our target price of NOK52 per share.
Valuation
We are now carrying 10 mmbbl gross reserves (1.75 mmbbl net to Panoro’s WI) for the northern flank at Hibiscus. Our Core NAV and ReNAV are respectively ~NOK32 per share and ~NOK52 per share. Even after the recent share price appreciation, at US$80/bbl for Brent, we estimate that the cumulative free cash flow over 2024-2026 would still represent ~80% of the current market cap. Important near term newsflow includes the drilling of Bourdon in Gabon (29 mmbbl gross prospective resources/~5 mmbbl net to Panoro WI) with an unrisked NAV of NOK4.80 per share and Akeng in Equatorial Guinea (180 mmbbl gross prospective resources/~22 mmbbl net to Panoro WI) with an unrisked NAV of NOK16.30 per share.
Panoro Energy is an international independent oil and gas company engaged in the exploration and production of oil and gas resources in Brazil and West Africa. In Brazil, Co. participates in a number of oil and gas licenses located in the Santos basin outside the south-east coast of Brazil and in the Camamu-Almada basin in the state of Bahia. In West Africa, Co. participates in a number of licences in Nigeria and Gabon. As of Dec 31 2013, Co.'s commercial production is from the Manati field in Brazil.
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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