RE:any post conf call comments from cannacord or clarus?.... nothing post call... last is Aug 10 with tgt $12 no change
2015/2016 San Jacinto Drilling Program Update
SJ 9-4
: The 9-4 well has been successfully drilled. Temperatures have increased to
262°C and Polaris expects connection to the plant in late October 2016. Management
has noted that it is too early to estimate the incremental MW contribution of the well.
SJ 6-3
:Drilling was completed in December 2015. Temperatures have increased to
217°C and management expects the well to achieve the minimum targeted temperature
of 220°C. The well has been connected to the plant to allow it to contribute additional
steam to improve overall plant generation.
SJ 14-1
: Drilling was completed in April 2016 and Polaris has decided to connect the well
as an injection well for cold condensate.
Mechanical clean-out and acid stimulation of four existing wells:
Polaris completed
the mechanical work-over of all four wells (SJ 11-1, SJ 12-1, SJ 10-1 and SJ 1-1).
SJ 9-2
: Polaris is attempting to convert the existing 9-2 injection well into a production
well. Accordingly, SJ 9-2 has been taken out of service as an injection well and is being
allowed to naturally heat up and will be assessed in Q3/16 in terms of its ability to
contribute incremental steam to the San Jacinto plant.
Valuation:
Our $12.00 price target represents 6.6x our 2017E EBITDA outlook. Polaris is
currently trading at 5.7x our 2017E EBITDA versus peers at 11.9x (5.7x-15.1x).