Good metrics, no coverage... I must say first that i like the metrics on this one and that i do have a position on this one, but there doesn't seems to be any interest in the market for Caza...
here's what i like :
1) Nav 2P of about 100 MM$ which is around 0,80 $ per share compare to a market price of around 0,16 $.
2) Revenu have been stagnant for almost 3 YR due to lack of money to develop; but they just conclude a 50 MM$ financing with apollo funding that will be used to drills 13 wells to develop their bone spring assets.
3) Q2 production was only 223 bopd (before any prod of the wells they will have from the 13 new wells). The first well (lennox state unit 32-2H) was test with a 390 bopd (50WI so 195 to CAZ) (mostly oil) on Jul 05 (so after Q2). They have lots of catalyst coming up since most the will be drilling/Test are due in Q3 and Q4.
Here's what i don't like;
1) Crappy Charts
2) Low Volume
3) Market doesn't seems to have any interest
My guess is that production could double in Q3 and probably triple on Q4. I think we could see the market beginning to react to this one after Q3 release or maybe on the YE release... but that's just my opinion... do you own DD ;)
Here upcoming wells and catalyst for remaining of the year :
| Lennox State Unit 32 #2H is on prod (see above) | | | | |
| Lennox State Unit 32 #4H has been permitted and is planned for Q4 2013; | | |
| Caza Ridge 14 State #4H; recovering frac fluids testing prod soon | | | |
| Gateway 2 State #1H Bone Spring well is drilling ahead at 8,641 feet; | | | |
| West Copperline 29 Fed #1H horizontal Bone Test in september 2013 | | | |
| Forehand Ranch 27 State #3 vertical well planned for Q3 2013 / test Ramsey Sand at 2,500 feet; | |
| Mad River 13 State #1H horizontal (Bone Spring or Brushy Canyon) test well is currently planned for Q4 2013; |
| the Madera 17 Fed #1H Lower Brushy Canyon well has been fracture stimulated and testing soon | |
| Madera 35 Fed #1H 3rd Bone Spring well has reached TD and is being prepared for fracture stimulation; |
| the Company is pushing for a Bone Spring development well to be commenced in Q4 2013. | |
Later
White