RE: AEN up 10.70% - Why? - Analyst UpdateFIRST GLANCE | COMMENT
FEBRUARY 26, 2008
Antrim Energy Inc. (TSX: AEN; 3.27; AIM: AEY)
Antrim updates on 2008 plans
Outperform
Above Average Risk
London analyst presentation sets out 2008-2009
milestones
Antrim today presented its 2008 - 2009 development plans to analysts.
Highlights were:
• Imminent project finance to fund its UK operations. Antrim expects
shortly to appraise the market on its project finance arrangements. For 2008 it
has scheduled CAPEX of US$113 million (we carry US$115m and expect it
to invest a further US$240m in 2009). Our C$4.50 12-month target price
implies an approximately 35% return if the funding relies on debt, and some
25% if equity;
• Causeway has additional potential. Antrim indicated its view that oil
flowing through the Causeway structure might have been trapped in structural
areas alongside the main Causeway. Antrim estimates that these might
contain some 15mmbbls gross P50 in addition to the 24mmbbls gross
estimated by its reserve assessors;
• Fyne and Dandy are appraisal projects. Although the company models
production from the Fyne and Dandy area at 15,000boepd (gross), it stated
that the area could still be viable at 10,000boepd.
• 2008 and 2009 development consents. Antrim will seek to submit a field
development plan for Causeway by end April 2008, and one for Fyne/Dandy
by end April 2009. First production from Causeway is targeted for End 2009
and that of Fyne/Dandy for end 1Q 2010. Expected 2010 exit rates are some
28,000boepd (we carry an average of 24,500boepd);
• Steady as she goes in Argentina. Its exploration and development plans
aims to reach 5kboepd in 2009 and some 7kboepd in 2010, mainly due to
production from Tierra del Fuego.
• Conclusions: Antrim is about to remove the uncertainty associated with its
project finance requirements, and is on track to develop the Causeway and
Fyne/Dandy projects within a reasonable timeframe. We therefore retain our
ranking of Outperform with Above Average Risk.
Connected Broker Research: RBC Capital Markets acts as Nominated
Adviser and/or Broker to this company.
Priced as of prior trading day's market close, EST (unless otherwise noted).
125 WEEKS 14OCT05 - 25FEB08
2.00
4.00
6.00
8.00
O N
2005
D J F M A M J J A S O N
2006
D J F M A M J J A S O N
2007
D J F
2008
HI-13JUL07 8.73
LO/HI DIFF 482.00%
CLOSE 3.27
LO-21OCT05 1.50
2000
4000
6000
8000
10000
PEAK VOL. 12432.9
VOLUME 1128.7
100.00
150.00
200.00
250.00
Rel. S&P/TSX COMPOSITE INDEX HI-13JUL07 312.40
LO/HI DIFF 321.15%
CLOSE 130.45
LO-27JAN06 74.18
Royal Bank of Canada Europe Limited
David Mestres Ridge (Analyst)
(+44) (0)131-222-3696;
david.mestres-ridge@rbccm.com
All values in CAD unless otherwise noted.
For Required Disclosures, please see Page 3.
2
Company Description
Antrim's operations are focused on two geographical regions: Argentina and the U.K. In Argentina, the company is focused on
near-field exploration. In the U.K., the company is progressing two offshore developments that it intends to have onstream by end
2009. It also has one early discovery that it intends to appraise in 3Q 2008. Antrim suffers from the lack of an exploration portfolio to
replace the pre-development assets, and 2008 may be a 'buy or be bought' year for it as it seeks to remedy this.
February 26, 2008 Antrim Energy Inc.
3
Required Disclosures
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Top Pick (TP): Represents best in Outperform category; analyst's best ideas; expected to significantly outperform the sector over 12
months; provides best risk-reward ratio; approximately 10% of analyst's recommendations.
Outperform (O): Expected to materially outperform sector average over 12 months.
Sector Perform (SP): Returns expected to be in line with sector average over 12 months.
Underperform (U): Returns expected to be materially below sector average over 12 months.
Risk Qualifiers (any of the following criteria may be present):
Average Risk (Avg): Volatility and risk expected to be comparable to sector; average revenue and earnings predictability; no
significant cash flow/financing concerns over coming 12-24 months; fairly liquid.
Above Average Risk (AA): Volatility and risk expected to be above sector; below average revenue and earnings predictability; may
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Distribution of Ratings/IB Services
RBC Capital Markets
Investment Banking
Serv./Past 12 Mos.
Rating Count Percent Count Percent
BUY[TP/O] 500 44.93 209 41.80
HOLD[SP] 525 47.17 148 28.19
SELL[U] 88 7.91 15 17.05
Q1 Q2 Q3 Q1 Q2 Q3 Q1 Q2 Q3
0
2
4
6
8
10
2006 2007 2008
02/15/08
I:OP:4.5
Rating and Price Target History for: Antrim Energy Inc. as of 02-25-2008 (in CAD)
Legend:
TP: Top Pick; O: Outperform; SP: Sector Perform; U: Underperform; I: Initiation of Research Coverage; D: Discontinuation of Research Coverage; NR: Not Rated;
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Lists include a former list called the Western Region Focus List (1), a former list called Model Utility Portfolio (2), and the Prime
February 26, 2008 Antrim Energy Inc.
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February 26, 2008 Antrim Energy Inc.
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