Twin Butte Energy Ltd TBTEF

Peters Energy Conference presentation

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Listened to the presentation. TBE is guiding to an 11/2/12 close of the Waseca purchase with end of year production set to go to 19,500 boe/d. Projecting a 3% production lift for 2013 that is 585 boe/d. Should exit 2013 producing over 20,000 boe/d. Dividend appears to be safe based on 700 heavy oil locations currently mapped in. Joanne Hruska was on BNN Market Call today: She did not make TBE a top pick but likes the issue, says the dividend appears to be sustainable and likes TBE as a solid investment. She is a sharp, well regarded analyst-money manager. In the Peters presentation Jim Saunders alluded to more smaller "mom & pop" heavy oil players reaching out to get involved in the TBE story via sale or merger. Despite this years robust buying spree the future may still hold for more additions to the TBE production and drilling inventory. $32 k per flowing barrel (about what TBE paid for EME, Avalon and Waseca) is over a 20% discount to current industry acquisitions. Basically TBE is acquiring assets at a reduced price amid a $95 + boe market, is also getting close to a $4.75 per boe bump on rail transported heavy crude over pipeline transported production. Model is still to drill a well every two days. Furthermore acreage in the Lloydminster corridor now selling for close to $1000 an acre up from $300. TBE is basically saying their 220,000 K undeveloped land position is worth $220 million or close to $1 a share in todays environment. Why this issue is not trading at $3.50 + seems baffling.  It suggests this story is just heating up. Stay tuned.