Fwiw - commentary from Stockwatch Jan 13
Further afield, John Wright and Corey Ruttan's Brazilian gas producer, Alvopetro Energy Ltd. (ALV), added 16 cents to $4.76 on 14,300 shares. President and CEO Mr. Ruttan patted the company on the back this morning for "clos[ing] out 2021 with another strong quarter of production performance." Strong is a word only a promoter would use when disclosing that production fell to 2,400 barrels a day in the fourth quarter from 2,500 in the third quarter. The promoter would have to remind investors -- and Mr. Ruttan did -- that production in late 2020 was barely 1,900 barrels a day, making the numbers look much better on a year-over-year basis.
As for the coming year, Mr. Ruttan provided little in the way of guidance, beyond referencing some "exciting" planned developments at the Murucututu/Gomo project. The company previously drilled two wells at this project in 2014, but then got busy with its core producing field, Cabure. The 2020 pandemic threw another delay into the works. Finally, during 2021, Alvopetro was able to declare commerciality at Gomo and make plans for a nine-kilometre pipeline connecting it to Cabure. The pipeline should be finished "in the coming weeks," declared Mr. Ruttan today, "[and should] enable the start of production and the broader development of the field."
So confident is Alvopetro in its future operations that it started paying a quarterly dividend of 6 U.S. cents in October. The yield is a generous 6.3 per cent, but thanks to a trim share count of just 33 million -- achieved through a 1-for-3 rollback in September -- the annualized cost is a manageable $10-million. Today Mr. Ruttan reiterated his commitment to "provide direct returns to shareholders through ongoing quarterly dividends."
Investors seemed pleased. Many are hoping that Alvopetro will be the third successful Ruttan-Wright promotion in South America, following Pacalta Resources (sold for $1-billion in 1999) and Petrominerales (sold for $1.6-billion in 2013). A separate promotion in Canada did not fare quite as well: Lightstream Resources, where Mr. Wright was CEO and Mr. Ruttan was a director, began trading at nearly $36 in 2009, but then fizzled out and was trading at just 11.5 cents by the time it ceased trading in 2016 and sold its assets to a private company. Mr. Wright (though not Mr. Ruttan) was also a director and key backer of Alberta producer Spyglass Resources, which entered receivership in 2015, its stock having fallen to five cents from $2.60 within two years.
Evidently South America provides firmer promotional footing. Adjusting for the 1-for-3 rollback, Alvopetro has spent the last year more than doubling to $4.76 from $2.10.