Palliser Oil & Gas Corp. PSLRF

Anderson type deal for Paliser could save it

[8675309Jenny]

Anderson has just done a deal with Freehold royalty, that could save Paliser and get it moving. Basically in the Anderson deal, they are selling 500 Boe/d of shallow gas assets, that have an engineering NPV value of 10m. In addition, the are getting 150M of Anderson's 370m of tax pools. (rounded). In other words they are paying 25m dollars for 150m of tax pools, or about 16c on the dollar. With Paliser holding over 100m of tax pools, this implies a value of 16-20m dollars for tax pools. Realizing this value could of course lower the bank debt, but equity is still required. at current prices, nothing works anyway

[roscoe74]

That could work if PXL can raise enough funds for capex to lower their operating (cash) costs to survive the downturn.-----The problem I see is that Freehold will have much better deals to choose from than PXL.

[perdikaoilgas]

Yes that was an interesting deal that could possibly work for PXL.

[perdikaoilgas]

But as you said FRU might have better deals to choose from.

[roscoe74]

What Palliser needs to do is lower their operating cost. At $30 - 35 /bbl op cost, PXL can not make money at $75 oil. Then they can sell some production with tax losses attached.

[perdikaoilgas]

They have to lower the operating costs A LOT.  This is why, I never liked and never bought PXL because of its debt. They were using Cadillacs although a Chevy could do the job. 

[roscoe74]

I dunno about that because the PXL geniuses are keeping very quiet about their execution of the business plan. ----- Pure speculation but my opinion is that they tried to pump too hard in order to meet guidance and broke into too much water. Then they had to advance drilling of disposal wells, they needed to heat too much production water to recover oil at the same time as a cold winter spiked

[mexmillion1]

This has sure tanked since Sept/Oct...does anyone have any idea on the Maha merger...is it a go or not? Thanks GLTA

[Oilmarket]

More likely it will be a bank merger. Surprised they have not filed yet probably give it another few weeks. Their high volume pump is too expensive so if they shut it off to lower operating there goes that oil too. They were pumping masses of water.

[righand2]

So why did you buy it, moron?