- Saturn Oil & Gas (TSX:SOIL), a potentially undervalued small-cap energy stock, is unveiling a value-accretive independent reserves evaluation
- The company’s 145.3 million barrels of oil equivalent of total proved + probable reserves is up by 131 per cent year-over-year
- Saturn Oil & Gas is a Canadian energy company developing high-quality, light-oil weighted assets in Saskatchewan and Alberta
- Saturn Oil & Gas stock (TSX:SOIL) is flat year-over-year and has lost about 30 per cent since 2019
Saturn Oil & Gas (TSX:SOIL), a potentially undervalued small-cap energy stock, is unveiling a value-accretive independent reserves evaluation.
The report states that, effective Dec. 31, 2023, the company provided exposure to 145.3 million barrels of oil equivalent (boe) of total proved + probable (tp+p) reserves, which is up by 131 per cent year-over-year. Additional highlights from the report include:
- A C$1.4 billion net present value of future net revenue from proved developed producing (pdp) reserves discounted at 10 per cent
- 879 gross (727.2 net) booked drilling locations, 78 per cent in Saskatchewan and 22 per cent in Alberta
- Tp+p reserves housing 82 per cent light & medium oil and natural gas liquids
- Long reserve life index of 6.2 years for pdp reserves and 14.8 years for tp+preserves
- 2023 tp+p finding and development costs of C$19.13/boe (2.5x recycle ratio)
- 2023 tp+p finding, development and acquisition costs of C$15.29/boe (3.1x recycle ratio)
- Net asset value per share:
- Proved developed producing of C$6.72
- Total proved of C$10.89
- Total proved + probable of C$16.69
- Share price of C$2.43 as of Jan. 30, 2023
Saturn’s average oil and gas production in Q4 2023 was 26,890 boe/d, with Dec. 2023 average production of 28,000 boe/d, based on field estimates, coming in ahead of the company’s guidance of 27,000 boe/d.
Saturn management estimates an additional 550 gross (450 net) unbooked drilling locations in Alberta and Saskatchewan, which together with booked locations combine for over 20 years of drilling inventory. This bodes well for the company expanding its track record of value-conscious acquisitions and consistent adjusted EBITDA growth dating back to the early days of the pandemic, which has received little in the way of market recognition. SOIL shares are flat year-over-year and have lost about 30 per cent since 2019.
“In 2023 Saturn executed the largest drilling program in its history, complemented by the impactful acquisition of Ridgeback Resources, which together drove significant production and reserve growth for the company. The Ridgeback acquisition added 474 gross (363.7 net) booked future drilling locations, which will support future oil and gas production and sustainable free cash flow generation,” Justin Kaufmann, chief development officer at Saturn Oil & Gas, said in a statement. “We are proud of our development programs and strategic acquisitions that have amounted to over 150 million boe of tp+p reserves additions over the past three years, at an attractive average finding, development and acquisition cost of C$14.35 per boe, accounting for expected future development costs.”
Click here for a full list of figures from the report.
Saturn Oil & Gas is a Canadian energy company developing high-quality, light-oil weighted assets in Saskatchewan and Alberta. The company is focused on increasing reserves, production and cash flows at an attractive return on invested capital.
Saturn Oil & Gas stock (TSX:SOIL) last traded at C$2.43 per share.
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