RE: Repeat of Dr. Faessel on IEThere three (3) and maybe (4) possibilities coming IE's way that will explode IE's pps into the $$$$ range....the 4th being a complete takeover in the works when certain milestones are met....
The Tamarack Project (Is regulatory approval coming shortly or on its way)
I spoke already of Ivanhoe Energy's Canadian Tamarack resource -- the value here alone far surpasses the market cap of the company. For starters, the resource was significantly upgraded in 2011 and is expected to produce at approximately 40,000 barrels per day for at least 30 years. The porosity and permeabilities are considered excellent reservoir characteristics. Management has been plowing away at a stack of engineering, financing, regulatory and environmental labors since 2008 and has targeted initial oil production for 2015.
Regulatory/environmental approval is now imminent from the Alberta Environment and the Energy Resources Conservation Board, per information from Ivanhoe's presentations and website. Because of Canadian regulations reserves cannot be "booked" without environmental approval. Key is that with this approval the 520 million barrels of recoverable potential can be then considered as a substantial addition to the asset side of the balance sheet with a corresponding significant impact on market cap. And it revises all the capital ratios of assets to liabilities that all institutions compute when they buy and/or add to existing positions. Heavy oil in the ground is worth about $1.00 a barrel once it has been blessed with regulatory approval and that makes the value of Tamarack well over two times the current market cap of IVAN's $148 million. Add the probable reserves (2P) of 175 million barrels, and you get the picture. Some estimates are that there are as much as 1.4 billion barrels in the Tamarack reservoir.
Notably, the regulatory approval and subsequent booked reserves will be of central importance to the Canadian institutional buyers as it is essential for Canadian institutional buyers and others to want a strong balance sheet and will allow them to purchase or add to their positions. While it's thought to cost about $1.4 billion in capex to get the first 20,000 bbd up and running consider with the price of oil at, say, $80 X 520 million barrels, or perhaps more than a billion barrels, and we're dealing with truly whopper numbers.
Ivanhoe's management believes that the 100% owned Tamarack's reservoir characteristics are very similar to Suncor's operational 30,000 barrel-per-day MacKay Riveroil sands facility -- one of the largest, longest-producing and most successful commercial operations of its kind in Canada and located only 12 miles away from Ivanhoe's reservoir.
Liquidity Concerns and Money Due From Ivanhoe's Divested Chinese Operations (IE is now flush with cash)
Per today's press release and the available data, Ivanhoe will shortly receive $105 million from Royal Dutch Shell, and another $20 million holdback upon the transfer/assignment of their Zitong Chinese operations. I might add that Ivanhoe will garner a significant profit from the disposition of this bloc. In addition, Ivanhoe will receive $40+ million from the divestiture of their interest in their China Dagang project that's also due to close shortly. In addition, per SEC docs; their cash balance as of Sept. 30, 2012, was $16 million. Net-net, the company will shortly be flush with cash and looks to retire the UBS bridge loan of $50 million.
Ecuador -- Pungarayacu(Is IE in talks and setting up a lucrative JV with a larger Oil Company)
Regarding IVAN's enormous Ecuadorian Pungarayacu field (426-square-mile block, about 40 miles long and 10 miles wide), independent third-party engineering analysis shows "up to between 4.3 and 12.1 billion barrels" of oil in place. By any standard, anywhere, this is a huge hydrocarbon deposit. Importantly, the resource may be even bigger than first thought: "Additionally, initial internal interpretations may also suggest an extension of the field beyond what was originally estimated."
The resource is so big that a partnership with a big company or a sovereign company is now becoming obvious. A recent company presentation about Pungarayacu said that "Ivanhoe is pursuing partnerships with industry participants." Not much meat on the bone there, but as Ecuador is on the west coast of northern South America I can foresee an Asian connection here, likely with a major Chinese "blessed" company perhaps even a sovereign becoming a major partner in some form with likely down-stroke of more cash to Ivanhoe.
Net-Net
Post the sale of their non-core assets, and the regulatory/environmental approval Ivanhoe's balance sheet will be dramatically improved. The company will then be focusing on their HTL™ technology and their proven reserves in Canada. The transformation of Ivanhoe Energy is close to becoming a reality in my opinion.