Post by
cashtango00 on Mar 04, 2016 9:56am
TD upgrades..
pay attention to the last 2 paragraphs. They no longer feel it is likely an equity issue is required and feel that any reworking of their agreement with the government will have minimal financial implications... upgraded the stock.
Source:
TD Canada Trust:
Details & Outlook Although the overall reserves were down, EOR reserve volumes doubled in the Patos-Marinza field (4.6mmBOE PDP, 14.7mmBOE 1P up 71%, 21.1mmBOE 2P up 86%, 27.3mmBOE 3P up 104%). Management believes that in a low oil price environment, a high-graded portfolio of EOR locations (which continues to grow; the company has identified over 240 additional contingent patterns) will allow for production maintenance with better economics than new wells. At year-end 2015, the company had implemented 53 polymer and waterflood locations, and had another 100 future locations booked. 1P and 2P volumes remain unchanged, but the company experienced an after-tax NPV10 down 12% and 21%, respectively. Management highlighted on the call that the lower F&D costs being realized on EOR efforts relative to new wells were not being materially accounted for in the reserve auditor valuation. Management continues to combine cost-cutting initiatives, an effective hedging strategy, capital discipline, and development program flexibility to weather the current difficult oil price environment. As a result, non-core drilling has been deferred until further notice, with the primary focus being on core drilling and EOR conversions (16 possible wells, 16 conversions planned for 2016). On the conference call, management reiterated that it believes that a conclusion to the 2011 cost recovery review can be expected in Q2/16, thanks to it now being a binding process. It should set a good precedent for the 2012 cost recovery review. Renegotiations for existing contracts with the government were also mentioned on the call as being expected to have a minimal impact on the long-run economic viability of the company’s projects. As a result of these disclosures, we have eliminated our previous expectation of a dilutive equity issuance this year as we believe that the flexible 2016 work program and reduced likelihood of significant cash outflows related to the disputes with the government have allowed the company a direct route to maintaining cash levels longer than we had previously anticipated.
Comment by
wallop13 on Mar 07, 2016 10:57am
I'm thinking TD will raise their target after earnings Thursday. Maybe Friday morning.
Comment by
dubsbs on Mar 07, 2016 11:08am
Just for the record. TD has never ever been close on anything I've ever owned....... nice to see upgrade but don't pay any attention to the #......
Comment by
braincloud on Mar 07, 2016 11:34am
I don't know any research house got their call right on energy and mining names. Pretty hard to stay on top of targets when the underlying commodity prices are changing weekly.
Comment by
wallop13 on Mar 07, 2016 1:36pm
That's true. But I'd rather have a raise then a reduction on the target. These targets give investors insight to set their own target. My target is higher then TD's, but I'm factoring in developments I think are likely to materialize.
Comment by
braincloud on Mar 09, 2016 8:13am
I'm in the same camp as Whallop. I think there's going to be some positive news regarding the dispute with the ALBS. It should clear the air nicely IMO. If oil holds we could see a test of the 200 day MA.
Comment by
good40 on Mar 09, 2016 10:37am
Depends on your description of " good news ". Any chance that a portion of 2011's $57 million discrepancy could be awarded to the government... and also be used to revise the next 4 years following 2011 ? If they agree to continue payment of $57 million in 2016, regardless of what it is allocated towards, it is not good news.
Comment by
braincloud on Mar 09, 2016 11:11am
Judging by your comment, THAT has to be the most misunderstood issue out there about BNK. You will see. If you believe any part of what you said to be a possible outcome, then the news will be fantastic!!
Comment by
Flowwiththego on Mar 09, 2016 12:54pm
Around what time is the audit set to release?