Canadian oil patch for sale!

[gordoffh]

At the price of Manitok this morning I trust management is actively buying back there much undervalued shares.

Not the right thread but I assune SD management is buying there undervalued shares also.  is oil going to 50?

[doc75]

At the price of Manitok this morning I trust management is actively buying back there much undervalued shares.

Not the right thread but I assune SD management is buying there undervalued shares also.  is oil going to 50?

 

I doubt MEI is buying much in the market.  They have a big delivery infrastructure problem on their hands that may require some significant capex.  I'd like for them to have that solved before deploying cash on a buyback.  But I would like to see some aggressive insider buying at $2 and below.  (Maybe that's what you meant?)  A small purchase was reported recently but nothing of meaningful magnitude.

 

Are people here still holding PWT?    I guess they'll announce the dividend whenever results are ready (mid-Oct?).  If it gets cut again then we're going to see a crazy drop.  I don't think it's likely they'll cut it at this point but it would clearly help their capital position, and if they see it coming in a couple quarters anyway I could see them deciding to bundle a divvy cut with a big write-off (or whatever other nasties come out of the investigation).

 

Curious to hear other better-informed opinions! :)

 

 

[Cardboard]

IMO, absolutely nothing of significance will come out of the PWT restatement. Remember that this is accounting from the past and that current cash flows are real and unaffected as mentioned by the company nor is the debt or assets.

 

Some numbers will be shifted from one place to another and you may see a charge to the book value which by the way is well well above the current share price. This whole thing is a side show. PWT declined, like the other unloved oil & gas stocks, because Brent and WTI have come down due to a slowdown in Europe. The people in charge are still competent and still on track to make it the best operator in the three plays that they have selected.

 

Cardboard

[alertmeipp]

Cardboard,

 

Are you doing anything in the O&G, adding to PWT,etc?? Are you still bullish?

 

Both PWT and LTS are negative YTD given what they have accomplished this year so far.

 

 

 

 

 

[gordoffh]

Additional insider buying in SGL . Latest purchase at 1.39 on sep 17 . That makes 6 different insiders buying

so far in september. Encouraging!

 

see Canadian Insider

 

 

[gordoffh]

Interesting response to question re buybacks posed to investor relations of MEI - posted on stockhouse board  - sounds promising however seems like a lot of info in reply    FWIW

 

Response From Mgmt

Here is the response I received from Mgmt. when inquired why they weren't buying even more stock at the current depressed prices: To answer your questions, we are currently buying stock back through our Normal Course Issuer Bid. Manitok has bought back almost 1.7 million shares since July 1st (over 2% of shares outstanding) and is continuing to do so now. With the recent successful Glauc well at entice, which tested at over 1,100 boepd, and the recent success at Stolberg with both our Cardium oil wells and the Mannville gas well, we feel that our capital will be better utilized by drilling the offsets to these wells in the 4th quarter while continuing to buy back our stock through the NCIB. If the price weakness persists, we will continue to buy back more shares at these lower prices. Based on what I know today, I expect that we will have our oil production from the new wells at Stolberg on in early October. We should have our 3 gas wells at Stolberg optimized before the end of October.

 

Read more at http://www.stockhouse.com/companies/bullboard/v.mei/manitok-energy-inc#mPfJHbOkjbmh4DV0.99

[Cardboard]

Alertmeipp,

 

Yes, I am still bullish and I have been adding to PWT and LTS very recently. I did cut down on LTS in the $8 range but, nowhere near enough based on the large decline that we have seen afterwards.

 

Both companies have improved vs a year ago and the share price is still in the same range. Brent and WTI are also in the same range by the way as they were in the Summer of 2013.

 

I firmly believe that $100 oil is here to stay with OPEC countries needing these prices. Not to mention Russia. Interestingly enough, the U.S. now also need $100 oil to maintain its oil & gas activity which has been a very large driver of economic growth. The latest release from Continental Resources also shows that Bakken wells are not cheap and going higher and this glut of cheap North American oil as portrayed by the media is nothing but a joke.

 

I have also been keeping my eye on copper prices and other metals to see if that oil price weakness is related to China or global economic activity. It does not appear to be as they remain firm with copper in the $3.10 - $3.15 range. My conclusion is that we have some temporary economic weakness in Europe that may get resolved with their latest QE, we have more NA production that in the past, but it is not cheap oil and most countries are not increasing production and we are also IMO one little crisis away from jumping right back above $100 oil.

 

Cardboard

[biaggio]

Earnings, restatement for PWT out

 

http://pennwest.mediaroom.com/index.php?s=27585&item=135228

 

I quickly scanned above -->Cardboard and others here proven right, restatement a non event? To me it looks like operating results better then expected (or am I missing something?).

[gordoffh]

Update  on MEI  looking good  and the news re PWT    maybe a good day

 

 

http://www.stockhouse.com/companies/bullboard/v.mei/manitok-energy-inc?postid=22947085pdate  MEI

 

 

 

[gordoffh]

Nice move on volume at close for LTS  . Might we have good news next week  .just nice to see a move upward

agt last

[saltybit]

What do you guys think of BXE?

 

Just starting to look at it, but they seem to have a relatively healthy balance sheet and good management in comparison to some of the canadian oil players, as well as being reasonably valued.

[gordoffh]

Encana buys Athalon Energy    well they didn;t sit on the Praire Sky money too long

 

Encana to buy Athlon Energy for $5.93 bln

29 Sep 2014 06:17 ET

 

Sept 29 (Reuters) - Encana Corp , Canada's largest natural gas producer, said it would buy Athlon Energy Inc for $5.93 billion in cash, excluding debt.

 

Encana, which is shifting its focus to high-value oil and natural gas liquids, will also assume Athlon's $1.15 billion of senior notes.

 

The deal includes about 140,000 net acres owned by Athlon in the oil-rich Midland Basin. (Reporting by Ashutosh Pandey in Bangalore; Editing by Simon Jennings)

 

[gordoffh]

For what is worth  eric nuttall  from sprott investment and frequent BNN guest take on sell off in oil and gas sector in canad 

 

 

 

 

Inside the Market Blog

Friday, September 26, 2014, 13:43:54

Sprott’s Eric Nuttall: Canadian oil stocks now ‘very’ undervalued

Eric Nuttall

Eric Nuttall, a guest columnist for Inside the Market, is portfolio manager of the Sprott Energy Fund.

The Canadian energy sector has experienced one of the worst monthly corrections in recent memory, with many oil stocks down by more than 20 per cent. Perhaps a little perspective is in order.

I queried a handful of Canadian oil executives this past week after the stock market pummelling, asking "how's business." The universal reply was "great."

One might have expected a more dour answer.

But consider the following: Despite oil having sold off this month by about 3.5 per cent in U.S.-dollar terms, when you take into account the positive impact of the falling loonie and the marginal shrinking of the Canadian light differential, the price of oil is down less than 2 per cent.

Further, given the continued efficiency improvements in how wells in many oil plays are being drilled and fracture stimulated, oil well economics today are the highest they have been in decades. I routinely see wells paying out in under a year, which speaks to the impressive returns that these oil executives are seeing.

Finally, the oil executives pointed out that service-cost inflation - the rise in costs for such things as drilling rigs and labour - is essentially non-existent, and that drilling and pressure pumping equipment availability is not a problem. In short, business is indeed great and they foresee another strong year in 2015 of impressive production gains that will generate excellent investment returns.

Now, if I were to ask the average investor how they feel about the energy sector right now, I would expect their answer to be the exact opposite of the rosy responses of those in the business, given the daily shellacking of oil stocks and the negative feedback loop that it has created.

Herein lies the opportunity and an example of why it is important to see the difference between perception and reality.

The current perception is that the price of crude oil is down because the Chinese economy is weak and suddenly demand has declined, that a strong U.S. dollar means a lower oil price, and that oil stocks are overvalued. The exact opposite is true. China has been weak all year even when Brent oil was over $120 (U.S.) a barrel, global oil demand has strongly rebounded from the lows seen in the second quarter, and the correlation between the US. dollar/euro exchange rate and oil is virtually non-existent over more than a three-week period. I would argue that the energy sector sell-off is due solely to the broader market correction and nothing fundamental to the energy industry. In my view, Canadian oil stocks are now very undervalued.

Fools call market bottoms and buy into the group think of the day. Shrewd investors identify when the difference between perception and reality becomes too large to ignore while allowing for the possibility that such circumstances can persist for a time. Today I can buy many mid-cap light oil companies that are down 20 per cent month-to-date, and as a result, are now trading below 4 times 2015 enterprise value to cash flow. They are all growing production by at least 15 per cent to 20 per cent next year and have strong balance sheets that can withstand any short-term volatility. Some are even paying sustainable dividend yields of 5 per cent or more.

This opportunity rarely occurs. The risk-reward in the oil sector today is the best I have seen in several years. I myself recently purchased shares in Legacy Oil + Gas Inc. and Gear Energy Ltd. during the pullback for my own fund, among others.

See the reality of today and don’t buy into the market’s misplaced perception. From my experience, this can be a setup to highly profitable times as fundamentals eventually win out and stocks again reflect them.

 

Read more at http://www.stockhouse.com/companies/bullboard/t.lts/lightstream-resources-ltd#UITTvPl0OxcrlGz7.99

[alertmeipp]

The sentiment on oil and gas stocks is like day and night compare to few short months ago.

 

How many of you still have significant weighting in this sector?

 

I added quite a few names last couple weeks and it is no fun.

 

Do you guys see this as seasonal or bigger thing is happening

 

 

[longlake95]

I'm still full weight in PWT. Holding.....

[Uccmal]

I'm still full weight in PWT. Holding.....

 

Me too.  My soft target is somewhere way above $20, based on comparables.  Alot of US Law firms trolling for clients but they seem to lack plaintiffs so far.

[Myth465]

IM in fully.

Added to PWE.

 

Think we will see a good asset sell soon, its tough, but the fundamentals for the sector are quite good.

My only fear is options. Down to 2016. I have 20% of my port in MEI and am quite comfortable despite the setbacks.

[sys]

How many of you still have significant weighting in this sector?

 

i've been trying to move away from resource stocks (a fondness for which is a weakness of mine), but i hold probably more than i should now and will be buying more if prices stay down long enough for me to accumulate cash.

[Myth465]

How many of you still have significant weighting in this sector?

 

i've been trying to move away from resource stocks (a fondness for which is a weakness of mine), but i hold probably more than i should now and will be buying more if prices stay down long enough for me to accumulate cash.

 

We have the same problem, was wondering if I was the only one.

[kevin4u2]

The sentiment on oil and gas stocks is like day and night compare to few short months ago.

 

How many of you still have significant weighting in this sector?

 

I added quite a few names last couple weeks and it is no fun.

 

Do you guys see this as seasonal or bigger thing is happening

 

Bigger thing is happening here. Can anyone think of a reason why someone would take the opposite side of your trade?

 

Here is why I wouldn't touch the sector with a ten foot pole. Reasons: 1) starts with a C and ends in a hina. 2) The industry has horrible returns on capital. Just look at the government of Canada data for the sector. 3) shale oil... we are only in the first inning and change is the enemy of a value investor.

[sys]

We have the same problem, was wondering if I was the only one.

 

ahh, but your attraction is rational - you know the industry.  i have no justification.

[alertmeipp]

Nothing that i see warrants this drop but again i am the dummy who added yesterday.

 

Commodities is fairly strong today.

 

I am tap out, all i can do is get slaughtered

[alertmeipp]

My USO puts did well but USO didn't really go down as fast as these producers.

 

Should use etf option next time.

 

Lol

[gordoffh]

I guess oil is going to 50 and all companies heading for bankruptcy. what a freefall for LTS.  so i held my nose and bought yet again. perhaps capitulation day. even if management is somewhat incompetent they were addressing concerns and still have decent lands and

very high netbacks. for all us who are in oil and gas i suppose we should stay away from high windows. unbelievable

 

[rohitc99]

I guess oil is going to 50 and all companies heading for bankruptcy. what a freefall for LTS.  so i held my nose and bought yet again. perhaps capitulation day. even if management is somewhat incompetent they were addressing concerns and still have decent lands and

very high netbacks. for all us who are in oil and gas i suppose we should stay away from high windows. unbelievable

 

 

The market is pricing in atleast 80 dollar oil.

 

well after taking pain all week, atleast I will feel good when filling up the tank on the weekend. lose in dollars, benefit in cents !