GTE one of Jennings top picks in the oil sector.. I've been picking away at it as low as 4.75 over the last few days..... jenningscapital.com
GRAN TIERRA ENERGY INC. (TSX-GTE)
Gran Tierra Energy Inc. (TSX-GTE) Recommendation: BUY James Humen
Previous Close: $4.71 12-Month Target: $10.00 (403) 292-9487
Market Cap (MM) $1,312 2010A 79.50 4.38 14,345 0.74 0.74
52 Week High $9.37 2011E 94.50 4.25 17,626 1.12 1.12
52 Week Low $4.45 2012E 95.00 4.50 22,021 1.44 1.44
Gran Tierra has a solid production base, strong balance
sheet and significant upside potential across its various
blocks.
Moqueta will be the focus of 2012, providing an additional
layer of production onto its well established Costayaco field.
Moqueta production is expected to begin ramping up from
~500 Bbl/d to levels that will be determined once reservoir
performance data has been acquired, the full aerial extent of
the field has been determined and the final development
concept is determined. At 2010, Moqueta net after royalty
(NAR) 2P reserves were 3.0 MMBbl and NAR 3P reserves
were 9.7 MMBBl, based on drill results from the first three
Moqueta wells. In 2011, the Company drilled the Moqueta 4,
5 and 6 wells and from results available to date, no
evidence exists that the oil-water contact has been
identified. There is potential for additional oil down-dip on
the flanks of the Moqueta structure.
Exploration Catalysts
Colombia
?? The Rumiriqui-1 exploration well, located on the Llanos-22 block, is expected to reach TD by the end
of December. The block is located adjacent to the prolific Cusiana/Cupiagua fields, which have
produced ~1.2 billion barrels of light oil to date.
?? Pacayaco-1 ST1 is expected to reach TD in January 2012. The well is targeting the same reservoir
intervals present at the Costayaco and Moqueta discoveries.
Brazil
?? Horizontal side-track on the REC-T-142, testing the productivity of the light oil sandstone reservoir
target. We should see results early Q1/12. Also, two wells are being drilled at the REC-T-129 block
and REC-T-155 block.
?? Yesterday, there was an article published on Bloomberg indicating that the first offshore Brazil well,
operated by Stat Oil, was dry. Gran Tierra was to farm-in for a 15% working interest. We did not
have any value in our model attributed to offshore Brazil.
JAMES HUMEN, CA
Research Analyst
james.humen@jenningscapital.com
+1.403.292.9487 |
