AEI presentation
I just listened to AEI's latest presentation. investorcalendar.com
Very, very impressive imho.
I highly recommend that anyone interested in the company listen to it. It's short, but packed with good info.
A few takeaways:
1) They're in the process of filing for an AMEX listing now. They expect to make AMEX sometime this summer. I view this as a terrific catalyst, as AEI looks cheaper to me right now than any U.S. listed energy stock (MUCH cheaper than most of them), and should really get a lot of attention once it obtains the U.S. listing.
2) O/S is 42 million, 49 million fully diluted. The Board of Directors owns 35% of the o/s (nice vote of confidence there).
3) I got the overall sense that this company has very good drilling prospects, even leaving aside Egypt.
They're clearly very excited about Egypt. The CEO said "we think there's the potential for 1 trillion barrels of oil in Egypt...these are huge, huge basins...a potential company maker. The oil is there....we just have to find the traps." They are obligated to drill 2 wells, but will probably drill 3-4 initially, while the rig is onsite.
4) I believe he said that capex will be around $35 million in 2006. They will pay for this out of cash flow, bank debt, and maybe some equity (not sure of the form equity issuance would take)
5) They have 8 years of proved plus probable reserves, and they expect that number to increase.
6) They have 400 BOEPD from their Bakken Wells in North Dakota, and he implied that there was more to say about this play....and that details would be given at a later time.
I don't know how this one will trade near term (not expecting fireworks, considering expected overhang from the merger), but I think that AEI is one of the most appealing juniors I've seen in a long time. Cheap based on current production, with very accomplished management and major catalysts around mid-year with the AMEX listing and Egypt hype- it adds up to a likely easy winner imho. And if they do hit paydirt in Egypt (which doesn't seem all that unlikely to me) AEI will probably be an ARD-like home run...
MM |
