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CGX Energy Inc V.OYL

Alternate Symbol(s):  CGXEF

CGX Energy Inc. is a Canada-based oil and gas exploration company. It is focused on the exploration of oil in the Guyana-Suriname Basin and the development of a deep-water port in Berbice, Guyana. The Company, through one of its subsidiaries, holds an interest in a Petroleum Prospecting Licence (PPL) and related Petroleum Agreement (PA) on the Corentyne block in the Guyana Basin, offshore Guyana. The Company, through its subsidiary Grand Canal Industrial Estates, is constructing the Berbice Deep Water Port. This facility, located on the eastern bank of the Berbice River, adjacent to and north of Crab Island in Region 6, Guyana, is being constructed on 30 acres with 400 m of river frontage. Its subsidiaries include CGX Resources Inc., GCIE Holdings Limited and CGX Energy Management Corp. It is the operator of the Corentyne block and holds a 27.48% working interest. Its Wei-1 exploration well is located west of the Kawa-1 discovery in the northern region of the Corentyne block.


TSXV:OYL - Post by User

Bullboard Posts
Comment by OIL_RUNon Aug 20, 2011 4:58am
893 Views
Post# 18963012

Possible Value of CGX

Possible Value of CGXOne more example to add from previous post - an extension of Examples 1 & 2:

Example 3:  The recent purchase of Tullow buying out EO Group's 3.5% interest in the West Cape Three Points for roughly US $305 Million would suggest: a 1% interest in West Cape Three Points could be valued roughly at US $87 Million

In similar respects, the offer made by Ghana / Exxon to buy out Kosmos interest in the 30.875% West Cape Three Points Block and its 18% stake in Deepwater Tano Block for US $4-5 Billion (for the calculation we will use the average of $4.5 Billion) would suggest: a 1% interest of in either of these blocks could be valued at US $92 Million. 

Looking at both evaluations above it seems the previous Jubilee related offers have been fairly consistent with one another - in terms of what a 1% interest in a Jubilee type discovery would be valued at.   

Assuming that both Jaguar and Eagle come in as predicted (equivalent to Jubilee, around 750 MMBO).  

Using a calculation of 1% interest = US $87 Million: CGX's 25% interest in Georgetown and 100% interest in Corentyne could be valued at US $10.875 Billion, or $55.83 per CGX share.  

So, a CGX SP of $55 is not as far fetched as some may think.  Granted, both Jaguar and Eagle will have to either meet or exceed expectations (equivalent to Jubilee, 750 MMBO).  The $55 calculation is merely derived from what others were willing to pay in an similar type analog (i.e. buying into Jubilee). 

However, to get close to a $55 SP - CGX will have to:
1.  Keep / maintain their interest in their Corentyne and Georgetown blocks, 
2.  Avoid issuing new shares.

If CGX can wait until Jaguar is drilled and evaluated before moving forward with steps 1 & 2 - the better it will be for shareholders (in my opinion). 
Bullboard Posts