2022 Recap
2022 Recap
Q3 9 month report:
- production increased from 8,567 to 12,816 bbl/d
- net income increased from $ 57,129,000 to $ 151,351,000
- shareholder equity increased from $ 195,572,000 to $ 361,367,000
Q4 Guidance
- production of 12,000 to 13,000
- completed wells: 2
- $198,000,000 free cash flow @ $80/bbl Brent
https://petrotal-corp.com/wp-content/uploads/2022/11/Q3-Reporting-Package-111822.pdf
Note:
As 2022 closes out Brent has average over $90/bbl for the year.
https://tradingeconomics.com/commodity/brent-crude-oil
Comment
The share price of the vast majority of Canadian oil producers has, not so much with the decline of oil prices since last March as the United States released oil from the Strategic Petroleum Reserve (SPR), fluctuated with the decline in stock markets starting at the beginning of the year. Compare TAL.V stock chart with $SPX:
https://stockcharts.com/h-sc/ui?s=TAL.V
https://stockcharts.com/h-sc/ui?s=$SPX
When the SPX began rebounding in mid-July and mid-October Petrotal's share price rebounded up into the end of August and again rebounded up into the beginning of November.
While Pertrotal's share price fluctuated with the SPX, it is significant to note that Petrotal's out performance does get reflected in its share price chart. While the SPX rebounded to peak mid-August it only rebounded to a lower peak at the beginning of December, Petrotal's share price on the other hand rebounded to a higher peak at the beginning of November higher than its peak at the end of August. Since starting out at $ 0.45/share at the beginning of the year Petrotal's share price is up to $ 0.66 as of this writing. Petrotal's share price has been on a steady rise from a low of $0.125 in mid-November 2020.
https://stockcharts.com/freecharts/gallery.html?TAL.V
Investors are taking note of Petrotal and accumulating shares.
While oil producer's share prices have been down at times throughout the year they have been the best performing assets as there is a commodity boom in response to unprecidented monetary expansion over the last number of years:
https://www.blackrock.com/corporate/insights/blackrock-investment-institute/interactive-charts/return-map
https://www.marketwatch.com/investing/index/dwcogs
Shubham Garg from White Tundra in his review of Canadian oil and gas producers made note of Petrotal's exceptional wells and models for Petrotal:
$70/4.50 168%
$80/5.00 255%
$90/5.25 340%
$100/5.50 431%
$110/5.75 518%
$120/6.00 605%
Since posting his review two months ago Brent very briefly fell below $80/bbl but rebounded above $80/bbl a week ago.
There is considerable fundamental supply and demand macro data indicating the long running supply deficit since 2020 only temporarily suppressed by release of SPR oil will continue as all the structural reasons for the deficit are still in place and with no sign of being rectified.
This indicates the rebound is the start of oil returning to the highs of $123/bbl earlier in March before release of oil from the SPR artificially suppressed the price of oil.
https://stockhouse.com/companies/bullboard?symbol=v.tal&postid=35183947
As to country risk, Petrotal issued a news release a week ago that indicated problems with a faction may well be getting resolved.
The company and all the other authorities have demonstrated sensitivity to sit with the faction to work our a resolution which has substantially enhanced cooperation that will be to the benefit of all. With final resolution trust funds can be put to work that will make substantial improvements for all. It is a very small population so $7 million can do a lot for them.
With country risk abating, with Petrotal excelling and rapidly growing production, and with fundamental macro conditions favouring near term and enduring higher oil prices, Petrotal is a strong buy.