Zephyr Energy Plc (AIM: ZPHR): High sales in 3Q23
• 3Q23 sales of 1,043 boe/d was above our expectations of 987 boe/d.• Production is expected to increase in 4Q23 with contribution from the six new Slawson wells.
• In addition, ten Harms East Federal / Quale Federal wells are expected to come online in December or January.
• 3Q23 operating income was US$4.3 mm, compared to US$4.2 mm in 2Q23.
• The story benefits from multiple important catalysts by YE24 including (i) production growth in the Williston, (ii) the redrill of Well 36-2 in the Paradox in March, (iii) the initial development and production start-up in the Paradox and (iv) drilling of the company first helium’s well in Salt Wash that could be spudded just after Well 36-2 is completed.
• This upcoming programme is expected to start derisking the large upside in the Paradox and allow the company to book additional reserves.
• We understand that the insurer has now re-imbursed all the costs associated with the work-over of Well 36-2 submitted by Zephyr.
• We re-iterate our target price of £0.16 per share.
Forecasts and Valuation
Our ReNAV for Zephyr is unchanged at £0.16/sh. Our unrisked NAV for the 39 mmboe 2C contingent resources in the Cane Creek reservoir targeted by the State 36-2 well in the Paradox basin is £0.12/sh while our unrisked NAV for the helium contingent plus prospective resources (average of 0.5 bcf) is £0.10 per share.
Rose Petroleum is an oil and gas (O&G) and mining company with exploration assets and an operational crushing and flotation mill. Co.'s principal activities are the exploration and development of O&G resources together with the evaluation and acquisition of other mineral exploration targets, principally gold, silver, uranium and copper, and the development and operation of mines in Mexico. In Co.'s O&G division, the area of focus is on two unconventional oil and gas basins in the U.S.: the Uinta Basin and the Paradox Basin. In its mining division, Co. continues its milling operations through its subsidiary, Minerales VANE S.A. de C.V., which owns the SDA Mill in Mexico.
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.