Nuvista Energy Ltd T.NVA

Alternate Symbol(s): NUVSF

Energy Oil & Gas E&P

NuVista Energy Ltd. is an oil and natural gas company, which is engaged in the exploration for, and the development and production of, oil and natural gas reserves in the Western Canadian Sedimentary Basin. Its primary focus is on the scalable and repeatable condensate rich Montney formation in the Alberta Deep Basin (Wapiti Montney). Its core operating areas of Wapiti and Pipestone in the Montney formation are located near the City of Grande Prairie, Alberta, approximately 600 kilometers northwest of Calgary. Its Montney Formation is a shale gas and shale oil resource. The Montney formation in the Wapiti area is a thick (200m+) section of hydrocarbon-charted fine-grained reservoir found at depths ranging from 2,500-3,500m.

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Nuvista Energy Ltd

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Post by retiredcfon Aug 11, 2024 1:29pm

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Post# 36173536

RBC

Not sure how TD picked up the Ha. As for RBC, their upside scenario target is $19.00. GLTA

August 8, 2024

NuVista Energy Ltd.
Q2/24 - In Line Results; Model Update

Sector Perform

TSX: NVA; CAD 12.31

Price Target CAD 15.00

Our view: NuVista reported Q2/24 production of 83,152 boe/d (RBC/ Street: 83,024/82,112 boe/d) driving AFFO (f.d.) of $0.67/sh (RBC/ Street: $0.70/$0.70). We have updated estimates to reflect tightened guidance for 2024, in tandem decreasing our 2024 CFPS estimate by -3%.

Key points:

• Q2 Results - Largely In-Line. NuVista reported Q2/24 production of 83,152 boe/d (RBC/Street: 83,024/82,112 boe/d) driving AFFO (f.d.) of $0.67/sh (RBC/ Street: $0.70/$0.70). Variance vs. our model included higher than expected royalties and operating costs. Capital expenditures were $121mm (RBC/Street: $125mm/$89mm) in the quarter. Exit net debt for the quarter was $268mm (D/CF: 0.5x) which is well below NVA's net debt target of $350mm.

• Return of Capital Strategy - Reaffirmed. NVA bought and cancelled 1.1mm shares for ~$15mm during the quarter. The company reaffirmed its RoC commitment of 75% and renewed its NCIB for 2024/25 (14.2mm shares).

• 2024 Guidance - Tightened. The company tightened its existing 2024 production guidance to 83,500-86,000 boe/d (from 83,000–87,000 boe/ d) and left its capital guidance unchanged at $500mm, with Q3/24 volumes positioned to be at the lower end of 83,000–86,000 boe/d due to hot weather and cooling restrictions placed in July on top of lower gas prices.

Operational Highlights. (1) NVA completed a 12-well pad in Pipestone North in H1/24, average peak rates per well were 1.8 mboe/d (42% liquids) while infill wells average 1.1 mboe/d (20% liquids); (2) NVA intends to drill a 14-well pad in Pipestone North which is expected to be completed in Q1/25 with the startup of a third-party gas plant; (3) NVA completed the expansion of its Elmworth facility and brought two pads on in Wapiti (6-well Elmworth pad, 4-well Gold Creek pad); (4) remaining activity in Wapiti includes drilling of two additional pads and completion of one pad.
Retirements. Keith McPhail has elected to retire from the Board of Directors, following 21 years with the company (as a co-founder). Additionally, after 16 years at NVA Keith Asman has elected to retire as VP Marketing, effective December 31, 2024.
Updates to Estimates. We have updated estimates to reflect the lower- end of tightened guidance for 2024 by -2% decreasing our 2024 CFPS estimate by -3%. Our 2025 numbers have been left relatively unchanged; CFPS increases slightly reflective of minor margin adjustments.