Canacol Energy Ltd T.CNE

Alternate Symbol(s): CNNEF

Energy Oil & Gas E&P

Canacol Energy Ltd. is a Canada-based natural gas exploration and production company with operations focused on Colombia. The Company’s production primarily consists of natural gas from the Esperanza, VIM-5 and VIM-21 blocks located in the Lower Magdalena Valley basin in Colombia. The Company’s production also included crude oil from its Rancho Hermoso block in Colombia (Colombia oil). It supplies approximately 17% of the country’s gas needs and more than 50% of the Caribbean Coast’s gas demand. Its gas fields which produce from the Cienaga de Oro and Porquero proven reservoirs are connected to its central Jobo gas processing and treatment facility through more than 169 kilometers of flow lines, mainly flexible steel flow lines. It operates over 1.5 million net acres in 14 exploration and production contracts in Colombia, with 11 of these contracts focused on exploring for and developing natural gas. These blocks are all located in the Lower & Middle Magdalena Basins of Colombia.

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Canacol Energy Ltd > Update by Edison Group

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Post by Tree2treeon Jan 17, 2022 11:00am

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Post# 34324366

Update by Edison Group

[See the disclosure at the end - this is sponsored research. Their full reports are available on their website.]

17 January 2022

Oil & gas - Mcap C$558m - Price C$3.16 - Update

Canacol Energy:

Canacol maintains drilling pace into 2022

We have updated our valuation of Canacol Energy to reflect management guidance for 2022 and its preliminary expectations for 2021. Our valuation per share decreases to C$5.69 from C$6.12. Management expects gas sales for 2022 to be between 160mmscfd and 200mmscfd, with the midpoint in line with realised average sales for December 2021 of 183mmscfd. Capex of US$172m to US$209m will cover up to 12 exploration and development wells, three of which will step outside the company’s historical core area, as it targets a reserves replacement ratio of over 200%. Management will also focus on progressing work on the Jobo to Medellin pipeline, which will add 100mmscfd of sales capacity by the end of 2024.

Year end	Rev (US$m)	Adjusted EBITDAX (US$m)	Cash from operations (US$m)	Net debt (US$m)	Capex (US$m)	Dividend yield (%)
12/19	220	166	108	300	(84)	1.4
12/20	247	188	152	299	(89)	5.7
12/21e	241	197	150	329	(108)	6.6
12/22e	255	197	158	428	(190)	6.6