RE:NAV is C$0.55 per share nowperdikaoilgas wrote: The model for calculating the NAV for any energy company is below:
2P PV10 + Working Capital - Long Term Debt + Undeveloped Acreage PTA has 500,000 net acreage out of which 450,000 net acres are undeveloped. Assuming a low US$400/acre, we get: US$400/acre x 450,000 net acres = US$180,000,000 So the NAV is: US$176 m (2P PV-10) + US$180 m (Undeveloped) + US$25 m (US$53M cash - US$28M notes) = US$381 million
US$381 million x 1.26 = C$480 million C$480 million / 872.5 shares = C$0.55/share ! https://www.petroamericaoilcorp.com/main/includes/media/pdf/2015-02-25%20YE%202014%20Reserves%20Release.pdf " The Company currently has approximately US$53 million in cash and short-term investments, and using cash-on-hand, intends to pay off a $35 million Canadian dollar denominated debenture at maturity on April 19, 2015. In order to take advantage of a strong US dollar, the Company has purchased $30 million Canadian dollars for approximately US $24.6 million at an average exchange rate of US $0.8191 for each Canadian dollar. The Company plans to purchase the final $5 million Canadian dollar tranche prior to the debenture maturity date. "
Additionally, US$400/acre is very low in Colombia. The current market value for undeveloped land in many places that border producing Blocks and properties is higher than US$400/acre. In the latest transaction for undeveloped acreage in Middle Magdalena about 1.5 year ago, Shell paid US$3,000/acre for Canacol's acreage in MM. See below: https://www.canacolenergy.com/i/pdf/ppt/Canacol%20Energy_March%202015.pdf
Well, I can't disagree with the way you analyze it. Under the current sircumstances, even a 10% discount to C$0.50 is fine with me when I can buy it at 14 cents...