TICKERS: POE
Oil & Gas Company's Q2/21 'Free Cash Flow Maintains Balance Sheet Strength'
Key points regarding Pan Orient Energy's second quarter performance and activities are made in a Research Capital Corp. report.
In an Aug. 13 research note, Research Capital Corp. analyst Bill Newman reported Pan Orient Energy Corp.'s (POE:TSX.V) Q2/21 financial and operational highlights, noting the numbers were generally in line with his firm's estimates.
A primary takeaway from Pan Orient's financial report for the quarter, Newman wrote, is that the energy company's balance sheet remains strong due to free cash flow. At the end of Q2/21, Pan Orient had CA$30.9 million (CA$30.9M) in working capital and zero debt.
During the quarter, from the Thailand joint venture operations in which Pan Orient has a 50.01% working interest, it garnered a field netback of CA$66.47 per barrel and CA$3.9M in total cash flow. The latter was lower than Research Capital's forecasted CA$4.6M, due mostly to higher corporate taxes.
"Pan Orient Energy remains in a strong financial position to develop and appraise its existing license in Thailand and to participate in future licensing rounds," wrote Newman.
As for the oil and gas company's Q2/21 production, Newman relayed it averaged 1,399 barrels per day on a net basis, consistent with Research Capital's estimate of 1,400 barrels per day. Pan Orient continues to work on optimizing production.
On the operational front, Newman summarized work performed earlier this year at the Thailand joint venture. Two wells were drilled and place on production, L53-DD10, a development well, and L53-DD11, an appraisal well. A third drilled well, L53-D12, encountered 6 meters of net oil pay and will be completed as a water injection well.
Pan Orient incorporated these well results into its geological model of the project, which showed drainage of the four reservoir sands is subpar. To improve the drainage, the company is considering drilling four more development wells in the L53-DD field this year.
Research Capital has a Buy rating and a CA$1.35 per share target price on Pan Orient, the stock of which is now trading at about CA$0.98 per share.
Pan Orient Energy Corp.
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2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Pan Orient Energy Corp. Click here for important disclosures about sponsor fees.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Pan Orient Energy Corp., a company mentioned in this article.
Disclosures from Research Capital Corp., Pan Orient Energy Corp., Update, August 13, 2021
RELEVANT DISCLOSURES APPLICABLE TO COMPANIES UNDER COVERAGE
1. The analyst holds shares in Pan Orient Energy Corp.
2. Relevant disclosures required under IIROC Rule 3400 applicable to companies under coverage discussed in this research report
are available on our web site at www.researchcapital.ca.
Mackie Research Capital Corporation, its directors, officers and other employees may, from time to time, have positions in the securities mentioned herein.
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