Chinook Energy Inc. Common CNKEF

New CKE (Montney): 5,400 boepd & 19 MMboe for C$90 million

[Miner1967]

Based on the latest guidance with the spin-off completed, CKE will produce 5,400 boepd (20% oil and liquids) from its Montney properties in March 2017 (exit production). Value Digger from Seeking Alpha estimates in his latest article that CKE's 2P Reserves from its Montney assets (Birley/Umbach and Knopcik/Gold Creek) will be at least 19 MMboe (25% oil and liquids) in December 2016. The independent reserves report will be out by February 2017. Now at C$0.45 with the spin-off completed, CKE's Enterprise Value at C$0.45 is just C$90 million, given that it will have a working capital surplus of C$5 million in March 2017 (see guidance). So this Enterprise Value translates into C$16,666/boepd and C$4.7 per boe of 2P. And CKE has ZERO debt too. And it also has its own gas plant while BBI, LXE and other Montney producers don't have their own plant. Also, the other healthy Montney peers currently trade above C$50,000/boepd and C$7 per boe. Mark that the Montney deals with healthy producers materialize for C$70,000/boepd and C$10 per boe. So I do expect a triple digit return from the current price level: The facts do not tell me something different... and as we speak for our money, any rumors or opinions without any facts or data, mean nothing to me.