Pieridae Energy Ltd T.PEA

I missed the boat

[smallcaptdr]

I have been dragging my feet on this one and wouldnt you know it that news came out today and I always have a problem buying at the high of the year so I'll wait for a pullback if one comes, GLTA

[Maxmoe]

I thought the same thing when I stubbornly refused to pay $1. Cause $1 is "just ridiculous ". So I paid 98. I almost missed a huge move in just one month over 2 cents. Whew! Good luck.

[Maxmoe]

The only way there will be a huge pullback, like back under $1, is if there is huge BAD news. Nobody that says they will buy on a pullback, a large pullback, ever does. They won't buy because of the bad news. And that could very well be the right call. The bad news may get worse. But barring bad news, they won't buy because there will not be a meaningful pullback. I bought pea for the gas,

[Maxmoe]

This stock was just 30 cents to start the year. It has to be the best kept secret in Calgary that alfie dodged the bullet and is up 5X,6X from there. Somewhere in the bowels of shell headquarters in "the city" somebody was fired for giving away those gas assets. Somewhere at london HQ the question is ..... why aren't we shipping LNG from Canada to Europe?  Or Canadian gas to USA

[Maxmoe]

I'd like to find a credible analysts report on the value of pea assets. Like nuttal's valuation of ATH when he bought at 18 and had a 10X target at much lower WTI pricing deck. Anyone seen one?

[commonsense9]

Shell gave the assets away?  They were for sale for 3 years with no takers. The goal was to unload them.   I'm sure they are happy too now- they would have been left holding the bag on the liabilities they wanted off their books, if Pieridae had continued winding down.  PEA was only not pushed into foreclosure because TEC did not want to be owners either. If Shell wanted

[Maxmoe]

Yes they gave them away. Because at $2 gas, that's what they were worth. They would not have cut that deal at $8 gas. Or $5.

[Maxmoe]

I sure as heck didn't buy pea back then, and not when they were pitching an LNG project in booners Nova Scotia.

[downwithdotcom1]

somewhere in one of PEA's financials i believe they commented that the replacement value  of the SHELL  infrastructure was $6 Billion.. maybe it was for sale for 3 years so?? DRY nat gas AT THAT TIME was easily below a $1 in the USA and even cheaper per mcf  in landlocked ALBERTA -this, being a product of years of over drilling for shale oil plus limited NAT GAS domestic demand

[commonsense9]

The gas assets were up for sale again (the "Strategic Review," and not passively, from last summer through the end of January.  Gas prices were way up, and everyone knew they would stay up at least for years. No takers this time either. And the choice of whether to sell was not up to Sorensen and the Board. Shopping the assets around was forced on them by the TEC sharks. But no one

[Maxmoe]

It's also possible the strategic review did not result in a deal because nobody offered fair value. I would not agree nobody was interested. Just nobody was willing to pay the offer. Id bet the offer was much,much higher than where the stock was pounded down to. Of course tec would say no to any ridiculous stink bid no matter how low the stock was driven. Sorry snakes, can't out slither

[commonsense9]

I dont know how much fair value had to do with it. But it was going to take $270million to pay off TEC. PEA had additional debts of around $150million- if those were not paid off as well they would have been in a position to make selling a problem, if possible at all.

[commonsense9]

I do agree that increasingly LNG does not matter. ARC is just the first to increase sales in the US, whether that is to LNG plants directly or because the general boost in demand those plants caused. Gas is going to be a good business to be in for quite a while.

[commonsense9]

When TEC and PEA made that deal, the only way it was going to work for either to plan, was if the LNG plant went ahead. Then part of the intial billions in that would go to paying off TEC. (The shares they had was a much smaller number than now, but the profits big on those.) They are not in this for the 15% interst (just a fallback) or for long term holding. They are WAY better off now than

[Maxmoe]

As long as gas is through the roof, I'd say $5 qualifies, there is no need to assume the only way to pay off debt is via cash flow. As pea trades higher and higher, and as debt is reduced lower and lower, even I can see multiple pathways without losing an ounce of flesh. And the LNG project? I couldn't care less. It's a distraction at this point. Sell it, spin it out, give it away

[elducky]

At current prices, and locking in fixed contracts next year at just $5, they would make enough to pay off the loan. Curve is well above that right now.  They may want to lock in a few years at $5+, maybe half of production. Get them past 2025 when their sulfur revenue also goes way up. 

[commonsense9]

That does not add up when you use a $5.00 price and plug that into the Q1 numbers (and assuming restored higher production than for that quarter). During Q1 PEA kicked out $5million per month in extra cash- a huge improvement. $5 gas raises that to $6.5million/month. The loan, with all the additions, is up to $270million. There are still $120million in Payables, with suppliers clamoring. (In Q1

[elducky]

I'm assuming $5 as the fixed contract for next year. I get an extra $120 million/year compared to Q1 levels, so you are right, I didn't include some of the expenses properly.  They'd need closer to $7 to pay down everything. Not that they'd need to pay it all down, if they paid off enough of it to be healthy. 

[Maxmoe]

Lol, I don't care, not really , if they were astute to buy when they did, or just plain lucky. Either way, they made a ton of money that's still not in the stock price. And to repeat, someone at shell made a stupid deal.