Billion boe oil shale:A billion barrel boe shale discovery in Argentina a week ago by YPF oil company say it is transformational for Argentina. There are a couple of Canadian companies that will benefit from the discovery and will make some big gains in the coming months. BOE, CWV and MVN are all exploring for oil in the same basin that YPF made their discovery. All 3 have significant land holdings in the basin. Base on past knowledge I have of CWV, I can tell you that in spite of Argentina's restriction on price for selling the oil domestically, the netback is still better than what you get from oil companies with operations in Alberta due to lower Royalties in Argentina. Also, when Argentina becomes a net exporter of oil (which they will given the big discovery), the companies will go back to selling at world price so that the government can get more tax revenues (they will no longer restrick them to sell domestically at lower price).
For those who haven’t heard about the big discovery announced Nov 7th, you are missing a big investment opportunity:
https://www.marketwatch.com/story/ypf-finds-927-mln-barrels-of-argentina-shale-oil-2011-11-07
All 3 looks like steal right now, especially CWV that announced drilling ramp up on same day the YPF discovery was announced. CWV also has the least amount of shares (only 54.7 million outstanding) and was recently beaten down due to tax loss selling from a Morgan Stanley seller who started selling after Argentina made the repatriation announcement (it’s a complete over reaction). See this link for some description:
https://www.stockhouse.com/Bullboards/MessageDetail.aspx?p=0&m=30374777&l=0&r=0&s=CWV&t=LIST
You will be thankful later when you see this basin starting to get real attention. Many majors are in the basin such as Exxon, BP, Total, etc but only a few juniors to get the big pop. It only costs CWV $1.5 million to drill a well, they are 12 for 12 in drilling so far (100% success), they have no debt, they announced ramp up for drilling program the same day YPF announced their discovery and they have $19 million in cash to complete their 2012 drilling program. Their netback is better than the average Alberta oil company given the lower royalty rates and lower OPEX. Plus analyst have target price of at least $3 for CWV before the big oil find, I would expect this target to go up.