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Bullboard - Stock Discussion Forum Southern Energy Corp V.SOU

Alternate Symbol(s):  SOUTF

Southern Energy Corp. is a Canada-based natural gas exploration and production company. The Company has a primary focus on acquiring and developing conventional natural gas and light oil resources in the southeast Gulf States of Mississippi, Louisiana, and East Texas. It has three assets in the Mississippi Interior Salt Basin (MISB), which include the Gwinville, Mechanicsburg, and Mount Olive... see more

TSXV:SOU - Post Discussion

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Post by TheRexmember on Jul 10, 2022 2:56pm

8 cap

The most interesting items in their report to me were

1. current value of the company - it is trading at $25,000.00 per flowing barrel right now with just under 30 cents a share in cash.
2. Using generation 2 well production (because they don't have historical data yet) the company is forecast to be trading at negative $2000.00 per flowing barrel by 2024. ( table on top left of report)
3. that implies a return of 13X over two years assuming valuation remains constant - plus added upside for gen three well design (30%?). COMPOUNDED. 
4. Plus upside from being able to add a bit of debt at reasonable cost due to the increased size of the company to goose drilling.

with some success on both fronts that could increase production another 50% beyond the gen2 well design with no debt base case. 

over the next 2+ years we could be looking at a 20 bagger. 

I am sure glad there was nonwarrant in the financing. this one is all lined up and ready to go...

Comment by nozzpack on Jul 10, 2022 6:20pm
Cogent  points . As I have posted recently, examples of companies being acquired above $60,000 per flowing barrel. Generally, astute buyers acquire for less than 70% of fair value peer multiples. So, we are grossly undervalued..