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Tamarack Valley Energy Ltd T.TVE

Alternate Symbol(s):  TNEYF

Tamarack Valley Energy Ltd. is a Canada-based oil and gas exploration and production company. The Company's asset portfolio is comprised of oil plays in Alberta, including Charlie Lake, Clearwater and several enhanced oil recovery (EOR) opportunities. The Company has an inventory of low-risk, oil development drilling locations. Its Clearwater oil play is located in north-central Alberta. Its Charlie Lake oil play is located in northwestern Alberta. Its EOR portfolio includes a set of assets across Alberta representing a range of formations and production types. The Company’s subsidiary is Tamarack Ridge Resources Inc.


TSX:TVE - Post by User

Post by retiredcfon Sep 25, 2024 9:44am
186 Views
Post# 36239977

RBC

RBCSeptember 24, 2024

Tamarack Valley Energy Ltd.
Desk Presentation Highlights

TSX: TVE | CAD 4.14 | Outperform | Speculative Risk | Price Target CAD 4.50

Sentiment: Neutral

We hosted a virtual desk presentation with Tamarack Valley Energy which featured Brian Schmidt (President and CEO) and Steve Buytels (CFO). The session mainly focused on core operations within the Clearwater and Charlie Lake, waterflood initiatives, plus a recent update on its Clearwater Infrastructure Partnership combined with broader industry observations.

Details:

Key Highlights. Tamarack highlighted its waterflood program as playing a key role within the company's future growth plans (ie. Nipisi and Marten Hills), with the team guiding to roughly now 8% of the Clearwater area's production being impacted by waterflood by the end of 2024 (vs 6% in 2023). The company's reserve book now features a 9-year 2P RLI, with clear prospects for extensions/ improved recovery (underpinned by 90MMbbl/118MMbbl of contingent/ prospective resources), providing a base for future growth.

2024 Guidance - Reiterated. TVE’s capital budget has been left unchanged at $390–440mm (now including CSV capital), while the company expects to reach the high end of its guidance range (61–63 mboe/d). The company expects its interest expense to be at the low end of guidance ($3.80–4.20/boe), which is inclusive of incremental TOP fees.

Recent Clearwater Infrastructure Partnership. Tamarack Valley highlighted expanding its Clearwater Infrastructure Limited Partnership which includes Bigstone Cree Nation as the 13th member of WWN, alongside the other WWN shareholders. TVE transferred an additional $50.8mm of certain Clearwater midstream assets into the CIP for cash consideration of $43.2mm (for total consideration $222.8mm) and maintains its 15% operated working interest (see more here).

Return of Capital - Key Focus. TVE reiterated its current phase of its RoC program at 60% of FCF targeted to shareholder returns while noting that it would balance increased base dividends within its 5-year plan. QTD, TVE has been active repurchasing ~8.5mm shares for ~$33mm via public filings. We forecast 2H/2024 FCF of roughly $163 million, of which $94 million will be paid out via a combination of base dividends and buybacks.


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