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CanAsia Energy Corp V.CEC

Alternate Symbol(s):  CECAF

CanAsia Energy Corp. is a Canada-based junior oil and gas company. The Company is engaged in the exploration for, and the acquisition, development and production of, crude oil and natural gas reserves. The Company, through its subsidiary, Andora Energy Corporation, is focused on developing the bitumen resources at the Sawn Lake property using steam assisted gravity drainage (SAGD) development. The Company has working interests in, four heavy oil sand leases with 27 sections (24.25 net sections) of Sawn Lake Alberta Crown oil sands leases within the Alberta Peace River Oil Sands area. In the Sawn Lake Central area, it operates with a 100% working interest in two oil sands leases with 11 gross sections (8.25 net sections). In the Sawn Lake South area, it operates with a 100% working interest in three oil sands leases with 16 gross sections (16 net sections).


TSXV:CEC - Post by User

Bullboard Posts
Post by seanyboyon Aug 11, 2015 2:16am
205 Views
Post# 24005841

patience

patience


A few thoughts...

The Sea Oil deal was clearly fortunate for POE, as it stands now $40 mil for 300bbls/day of declining production with Brent cut in half isn't a deal that Sea Oil would have done in hindsight. Even with another firm well I don't think anyone is holding out much hope for Thailand.

Semantics aside regarding exploration vs appraisal, Batu Gajah has a high chance of hitting the same structure Ramba has the three wells on. We'll have to see the pay zone and flow rates. I've been reading up on the cost recovery pool concept, still not quite sure how to do the sums but basically it seems that company can earn back the capital spent on exploration before revenue is split with the government. $50mil US is virtually all of the company's market cap at this point. My very rough guess is that success at Batu Gajah, defined as 3 wells with metrics similar to Ramba's. would be worth upwards of $100mil.

I am also confused as to whether "Talisman" is obligated to drill Anggun, but whatever obligation would carry over to Repsol. I think they're just calling it Talisman since it's the same cast of characters. Everyone agrees the GCoS on the 3rd party report isn't so great, but given the potential size of the structure relative to the low cost of drilling I don't see any reason to be overly skeptical. It's also unclear whether the GCA report takes into account what POE management is saying about the "proven source kitchen" next door. I suspect not. I wouldn't own POE because of Anggun, but it's still an asset worth having with large potential upside, even if the odds are longish.

Sawn Lake seems to be totally out of the discussion these days, but it's on track for best or even high case. Like the last presentation says, the ongoing maintenence costs are low, and we can afford to wait. I'll be happy to wait until WTI is north of 100 again, and what's Sawn Lake worth then with SAGD demonstrated successful?

Last thought - management and board members are on board. Patience here will be richly rewarded, IMHO.

Bullboard Posts