Southern Energy Corp. (SOUC LN/SOU CN): Increased premium to Henry Hub suggests strong underlying fundamentals
• 1Q24 production of 3,009 boe/d was in line with our forecasts. The net debt at the end of March was ~US$1 mm below our expectations.• We continue to assume that the 2nd DUC will not be completed before 4Q24 with the further DUCs being completed in 1Q25 and 2Q25.
• We note however the strengthening of US gas prices with 3Q24 futures for Henry Hub now standing at ~US$2.8/mcf (we previously forecasted US$2.5/mcf).
• In addition, Southern is seeing a realization basis premium to Henry Hub in the South East of ~US$0.95-1.40/mmcf. This is very material as the >35% premium over Henry Hub has a major positive impact on economics. The premium seen over the summer compares with premium of 2x the current s/p) and our ReNAV of £0.76/sh are broadly unchanged.
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.