stockwatch note out on the 24th
some good info here
Michael Kabanuk and Brendan Carrigy's Alberta Bakken-focused Granite Oil Corp. (GXO) lost two cents to 48 cents on 158,700 shares. It has closed a $1.56-million private placement with insiders, issuing three million shares at 52 cents. Of those shares, 480,000 went to its president and chief executive officer, Mr. Kabanuk, who now owns 1.13 million of Granite's 37 million shares. Another 480,000 shares went to its chairman, Mr. Carrigy, who now owns 1.03 million. Forty thousand shares went to director Kathy Turgeon, boosting her holdings to 43,000. The remaining two million shares all went to GMT Capital and its associate GMT Exploration. GMT now controls 7.29 million shares. It has been a long-time supporter of Granite and previously owned shares of Granite's predecessor, DeeThree Exploration, which in mid-2015 split itself into two companies, Granite and a sister called Boulder Energy (which was taken private at $2.59 a share by ARC Financial in 2016). One of Granite's directors, Kevin Andrus, is GMT Capital's portfolio manager of energy investments.
Granite says it will use its freshly raised $1.56-million for that common but vague purpose, working capital. It will have to try harder than that to impress investors who have watched the 48-cent stock collapse from its November, 2015, peak of $9.39. Granite tried to bring some attention to itself last March, when it started a "strategic alternatives" review, code for putting itself up for sale. It was trading at about $2.75 and producing about 2,210 barrels of oil equivalent a day at the time. That production was down from the late 2015 level of about 3,500 barrels a day). Since then, production has dropped even further, to 1,950 barrels a day (as of the third quarter of 2018. Meanwhile, Granite's once generous dividend has withered away to nothing. Granite used to pay a 3.5-cent monthly dividend that was chopped to 2.3 cents late last year, then chopped again to one cent last October and finally suspended earlier this month.
Granite was hopeful for months that a suitor would look past its rocky history and take an interest in its enhanced oil recovery (EOR) project in the Alberta Bakken. This is an early-stage project, only about five years old, but thanks to it, Granite has been able to improve the notoriously high decline rates of its Bakken assets to about 25 per cent (as of April, 2018) from around 40 per cent. The project also lends itself to "industry-leading capital efficiencies and operating costs," boasted Granite. Despite these and other tirelessly promoted claims, Granite was unable to attract a suitor, and cancelled its "strategic alternatives" process at the end of October. It has yet to release specific future plans, beyond saying that it plans to "continue to evolve and adapt its strategy to effectively weather the current price challenges and provide long-term value for shareholders."