malx1 wrote: cpeczek wrote: Venezuela is hosting a referendum in 2 weeks to officially lay claim to 2/3rds of neighbouring Guyana. Guyana has found massive amounts of oil offshore through mostly American led explorations and has been the fastest growing economy over the last few years as a result. The GDP per capita for the country actually surpassed Canada a year or two ago although that has not translated too well for living standards there yet.
Venezuela has claims on those 2/3rds from the time of the Spanish Empire and it seems like the government there wants to officially lay claim as a distraction from internal economic issues. When this likely passes the government may try to attack Guyanese (and maybe American) ships in their claimed ocean territory and possibly invade the land or could just rattle sabres and bide their time.
If Venezuela thinks that the US isn't going to get involved because they are focused on Israel and Ukraine they might actually fully launch the attack which may or may not trigger an American response. This could disrupt Guyanese and Venezuelan production and exports.
So we now have the potential of:
-Middle East War spilling over into oil producing states
-Azerbaijan attacking Armenia and likely being sanctioned from oil/natural gas exports
-Venezuela attacking Guyanese oil operations in the ocean, blockading them from exporting or fully attacking the country
as well as Russia still attacking Ukraine and remaining under sanctions and Iran remaining under sanctions.
What a wild few years this has been.
There is mega investor malaise leading to general apathy for Energy-related investments.
Nothing new. People hate volatility. So they avoid it.
With that said, some of these Canadian Mammoths like Suncor and CNQ and the gang, they will be so undeniably profitable at $100 oil, I foresee a slow-moving re-rating taking place for Energy names in years to come.
Think about it for a second:
Our Bellwether Suncor, worth $60B, generates $6B annually in Free Cash Flow.
Say Suncor decided to suspend the dividend and ignore debt repayment for ten years.
Suncor could stockpile $60B and buy itself. (only if share price stays same, and it won't)
Same story could be told for our little darling here, GH.
"Theoretically" the company could stockpile FcF and privatize in 10yrs.
When stuff stays too cheap for too long, interesting things happen:
Unsolicited takeover bids, mergers, guys like Kasking start loading up on the shares etc.
We have been in the thick of it, now we are working our way out of th weeds.
People follow money; maybe GH will turn some heads when it's paying .06/mo. and net debt is $40mm.
BNN will be calling then!
Kasking will decide if he takes their call.