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Chinook Energy Inc. Common CNKEF



GREY:CNKEF - Post by User

Bullboard Posts
Post by templetoothon Feb 09, 2016 12:55am
102 Views
Post# 24538458

First glance re 2015 reserves

First glance re 2015 reserves
Very cursory observations re the new reserve report: 2P reserves increased from 27.4 mm boes to 30.6 mm and the before tax net present value (10% discount rate ) went from $261 million to $198.75 million '14 to '15. The new before tax NPV is 92 cents per share plus credit for cash of 14 cents equals $1.06 per share. No value for land included in this calculation. Of interest, one sees that $198.75  million for reserves of 30.6 million boes works out to $6.47 per barrel in the ground.

A week ago I had the temerity to compare CKE to CQE given the then available information, and got a little grief for so doing.  Glutton for punishment, let's do this again. Let's assume that Chinook's boes are worth a fair bit more than Cequence's boes due to higher liquid content, so instead of $6.47 per boe, let's assume $5 per  CQE boe. Cequence as of a year ago had 118 million boes of reserves. IF that's still a reasonably valid number, and I don't honestly know, that works out to a reserve value of $590 million. Deduct $68 million debt, call it $70 million round numbers for a value of $520 million. Divide by 211 mm shares and you get $2.46 per share.

CKE and CQE have very similar share counts: 215 versus 211 million. Chinook on a good day is worth $1.06 and Cequence by the same metrics $2.46. Current prices are 44 and 34 cents. This, mes amis, is not entirely logical.

There may be other, more egregious examples out there, perhaps Storm as someone noted, but just wanted to point out that CQE is absurdly priced, given available info, in comparison to a very modest price for Chinook.

Again, don't shoot the messenger, and wishing you all the best with CKE-- but for heaven's sake, if you think this stock is a good deal, TOUT TOUT TOUT, do some cursory look-see at CQE. You're welcome!
Bullboard Posts