CIBC Update - BXE(with thanks to Rotair for posting on Trusts)
Bellatrix Exploration Ltd.
Solid Drilling Results Targeting Both Notikewin &
Cardium Prospects
Bellatrix has brought its 11-27 Cardium Hz well on-stream at over 300
Boe/d (100% WI). The company now sees an inventory of 200 (120 net)
Cardium locations across its 133 (81 net) sections of land in the Pembina
area (see our December 15 note for details on Bellatrix's Cardium play).
The company's first Hz multi-frac Notikewin well delivered strong results,
testing at up to 10 MMcf/d and coming on-stream at 5.4 MMcf/d plus 270
Bbl/d of condensate (or 1,170 Boe/d). A second Notikewin Hz well will be
spud in early January & Bellatrix sees an inventory of 50 (26 net) locations.
Bellatrix continues to evolve as management looks to the application of new
completions technology in unlocking its existing resource base. On a $40MM
net capex program we expect production to avg 7,700 Boe/d in 2010 and
note that ongoing success could accelerate drilling activity through the year.
Bellatrix trades at a 2010 EV/DACF multiple of 5.8x and an 8% premium to
NAV (vs. the group at 5.1x/-15%). Our PT moves to $3.80 (from $3.20)
reflecting the increased inventory ($1.10/shr of upside) & our roll-fwd NAV
of $2.70/shr. Our rating remains SP given the recent stock move.