Post by
MyHoneyPot on Sep 18, 2024 12:04pm
Wembley/Pipestone Evaluation - Understated
The NVA purchase price for Pipestone play was 625 million dollars, but when you include all the finance charges, comission paid on share sales and legal the total costs were quiet a bit higher.
At least 650 million dollars for NVA to buy Pipestone asset with 9,700 boe/day of production.
Kelt with 110,139 acres of land at Wembley/Pipeston or 3.1468 times the size of Nuvista purchase. This does not include the Charlie Lake.
NVA has great management and Jonathan Wright is a superstar, so i don't believe they over paid for Pipestone at all. So that 35,000 acres is going to be ramped up to 62,000 boe/day, so it was purchased with significant potential.
35,000 acres with the potential of 62,000 boe/day (20 years) consider the potential of wembley pipestone
So with CVS Albright plant on stream, and the fact that Kelts play is higher liquids and more oil. Its worth at least 3 times what NVA paid many years ago.
So is 3.14 * 650 million = 1950 million add in 250 million in for some Charlie Lake and this play buy itself could be worth 2.2 billion dollars.
The charlie lake is very montney like with generally two pay zones and the montney can have up to 4 pay zones.
So this play looks a lot like the permian basin of the North to me. With up to 6 stacked horizions.
Kelt is simply way to cheap and when they property gets more developed it will simply increase in value. Buying Kelt here is like paying a huge discount to its intrinsic value.
This is my opinion....
MHP
IMHO