Hydra CapitalMalcolm Shaws take on POE.
Pan Orient Energy (POE.V, last at $1.02) I mention POE because it’s a fairly pure play on Brent oil prices. POE has lowered its operating cost structure in Thailand and improved its sales pricing materially over the last year. Drilling has also gone well. Unless POE gets into the exploration business again, I don’t expect to make a big score here, but I can easily make a case that the stock is worth $2 based on what I know today. POE is an odd story in that twice it has made asset dispositions at prices far in excess of what the market would think is possible and I think this is a good environment for them to monetize should they wish to sell. POE has about 60% of its market cap in cash and is minting money right now from its ~1,300-1,400 bopd of Thai oil production. POE is a small position for me, but I like it.
I have no doubts on that they easilly could make an asset disposition @ twice the current MCAP. Current fundsflow will be magnificent.