Update by Edison Group[See the disclosure at the end - this is sponsored research. Their full reports are available on their website.]
17 January 2022
Oil & gas - Mcap C$558m - Price C$3.16 - Update |
| We have updated our valuation of Canacol Energy to reflect management guidance for 2022 and its preliminary expectations for 2021. Our valuation per share decreases to C$5.69 from C$6.12. Management expects gas sales for 2022 to be between 160mmscfd and 200mmscfd, with the midpoint in line with realised average sales for December 2021 of 183mmscfd. Capex of US$172m to US$209m will cover up to 12 exploration and development wells, three of which will step outside the company’s historical core area, as it targets a reserves replacement ratio of over 200%. Management will also focus on progressing work on the Jobo to Medellin pipeline, which will add 100mmscfd of sales capacity by the end of 2024. |
| Year
end | Rev
(US$m) | Adjusted
EBITDAX
(US$m) | Cash
from
operations
(US$m) | Net debt
(US$m) | Capex
(US$m) | Dividend
yield
(%) |
| 12/19 | 220 | 166 | 108 | 300 | (84) | 1.4 |
| 12/20 | 247 | 188 | 152 | 299 | (89) | 5.7 |
| 12/21e | 241 | 197 | 150 | 329 | (108) | 6.6 |
| 12/22e | 255 | 197 | 158 | 428 | (190) | 6.6 |
Business description
| Canacol Energy is a natural gas exploration and production company primarily focused on Colombia. |
| Canacol Energy is a research client of Edison Investment Research |
James Magness, oil & gas analyst
oilandgas@edisongroup.com
+44 (0)20 3077 5756