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CEO.CA members discuss high-risk penny stocks which can lose their entire value. Only risk what you can afford to lose.
anonymousPetroamerica Oil $PTA was upgraded to Buy from Hold at Canaccord Genuity yesterday by energy analyst Christopher Brown, maintaining a C $1.00 price target on the Colombian oil explorer and producer. PTA has a good combination of high risk exploration and lower risk development wells to be drilled over the next year, Canaccord writes. PTA will pay 5.5% of the drilling costs on the Tautaco exploration well planned for Q4/15 for a 50% working interest. PTA may drill 2 appraisal/development wells targeting N Sand opportunities (Suroco) in early 2016, contingent on oil prices. PTA will pay 10% of gross drilling costs for a 40% working interest in the Tinigua-1 well in 2016. PTA has $25 million in cash and has reduced its program to $8.5 million. This "will allow the company to work within its means through to 2016 even in a weak commodity price environment,” according to the analyst. Contact your Canaccord Genuity rep for a copy of the research note.
Jonathan Jones$PTA in Canaccord’s Morning Coffe
“Petroamerica Oil* (PTA : TSX-V : $0.61), Net Change: 0.00, % Change: 0.00%, Volume: 240,665
TAUTACO TUESDAY! Petroamerica, the Canadian oil and gas company operating solely in Colombia, released its Q2 financial results on Tuesday, and provided an operational update on the company's activities. Petroamerica reported average production of 3,634 boe/d versus Canaccord Genuity Oil & Gas Analyst Christopher Brown’s expectation for 3,864 boe/d. CFPS was $0.03 versus Brown’s estimate of $0.04. Overall, the company posted $18.1 million in revenues, selling 333 thousand boe with a realized sales price of $54.47/boe. The company, however, posted a net loss of $2 million as it continues to reduce field operating expenditures. The company, which recently tightened up its share structure 10 for 1 and acquired Petronova, currently has $25 million of cash, $11 million in estimated working capital and $13 million in restricted cash. The next exploration catalyst is expected to be in Q4/15 with the drilling of the Tautaco well (LLA10-50% W.I.), which Petroamerica is predominantly carried on. Remaining exploration and development has been predominantly pushed into 2016 to preserve its balance sheet for the foreseeable future.”
*This is not investment advice, please DYODD. Thank you
anonymousTD Securities is still bullish on Petroamerica Oil $PTA, with a $1.80 price target (lowered from $2.00) and BUY rating in a new report by analyst Jamie Summerville published last Tuesday. $PTA’s recent production of over 4,100 BOE/d is more than PTA’s forecast 3,600 BOE/d average production guidance for 2015 (the company is expecting declines this year, and is planning minimal capital spending). Oil price weakness has increased financing risk. TD assumes Petroamerica will be able to debt finance its development of risked exploration potential, but recognizes that equity dilution could be a possibility in 2016. TD likes PTA’s relative valuation and exploration upside, with two near-term high impact wells to be almost entirely funded by others. TD notes a discovery at the Tautaco exploration well, to be spud in the 4th quarter, could be worth $40-$80 million net to PTA. PTA will cover 11% of the costs of the well for a 50% working interest.
@tommyasked $pta CEO Ralph for an update Nov 1 and did not hear back. We are pals. Maybe something's up or my message got lost in the mail. $pxt$gte or $pre could bid. My boots are full at higher prices. dyodd
PamplonaTraderIf I wasn't clear in my post re $PTA, I think Vetra is making a play to take it out. The whole package is cheap and they would be consolidating assets before $OXY expansion foments a premium in Colombian E&Ps
@tommy$pta I should be very happy to get stronger paper and 40% premium. Gran Tierra $gte is a great platform. Still, if I had only sold when oil was $100... (We all have stories like this). I wrote about PTA over 50x and visited their HQs in Calgary and Colombia- their (excellent) management team gave me an intro to the oil business. I rode the stock from the teens to fourty cents and back twice over three plus years but we didn't make any money.. It all started just as ceo.ca launched with this blog post http://ceo.ca/2012/08/20/pta/ ... to the readers who may have bought some and lost money, I apologize - but I'm going to stick with GTE
Skin_inthegameDon't apologize for oil crashing - that non operator model worked impeccably with a high oil price. Congratulations longs, $GTE's balance sheet should unlock a TON of value in $PTA's assets. Junior non-operators can get squeezed at these oil prices.
@JonathanJones$PTA in canaccord's morning coffee Nov 16, this is NOT investment advice, pls DYODD. JJ
Petroamerica Oil* (PTA : TSX-V : $1.30), Net Change: 0.38, % Change: 41.30%, Volume: 6,026,616
Gran Tierra Energy* (GTE : TSX : $2.99), Net Change: -0.21, % Change: -6.56%, Volume: 1,558,833
MOMMA SAID BUY YOU OUT. Petroamerica Oil and Gran Tierra Energy, both international oil and gas companies operating in Colombia, announced they have entered into an agreement whereby GTE has agreed to acquire all of PTA’s shares. PTA shareholders will receive, at their election, either 0.40 of a GTE share or $1.33 in cash for each PTA share, representing roughly a 40% premium to PTA share price on Thursday. GTE will also assume net positive working capital of $25 million and estimates the value of the transaction at $84 million. Canaccord Genuity Oil & Gas Analyst Christopher Brown says that PTA is a strategic fit for GTE and will lend itself to synergistic cost savings through centralization of operations. Brown says that if an arbitrage exists on trading, he thinks there is a high probability of this transaction going through and investors should capitalize on the opportunity. Brown does not believe there will be a competitive offer as there are not many companies who want to make new entries into the Putumayo basin. PTA’s board has unanimously approved the acquisition, along with officers, directors and shareholders that collectively hold about a 10% stake have agreed to vote in favour of the acquisition proposal. The acquisition is expected to close on or about January 29, 2016
@tommy$GTE's $PTA ACQUISITION METRICS
Based on an estimated purchase price (net of working capital) of $84 million, the acquisition metrics are as follows:
- Working Interest Production: $28,000 per flowing boe
- Proved Reserves :(1)(3) $18.71 per boe
- Proved + Probable Reserves:(1)(3) $10.40 per boe
- Proved + Probable + Possible Reserves:(1) $6.43 per boe
- Cash Flow Multiple:(2) 3.8 - 4.2 times
- Recycle Ratio: (4) 1.8 times
Appears accretive to $pxt also but I'm biased and need the money!!
@JonathanJonesMy apologies if posted earlier. $PTA$GTE In Canaccord’s Morning Coffee Nov 30, 2015
This is not investment advice, please DYODD. Thank you
“Petroamerica Oil * (PTA : TSX-V : $1.32), Net Change: -0.01, % Change: -0.75%, Volume: 23,944
Gran Tierra Energy* (GTE : TSX : $3.30), Net Change: -0.01, % Change: -0.30%, Volume: 102,071
"I CAN SEE CLEARLY NOW." – JIMMY CLIFF. Petroamerica, the Colombian oil & gas company, announced Q3 results that were slightly ahead of expectations. In Q3, the company averaged 3,655 boe/d versus Canaccord Genuity Oil & Gas Analyst Christopher Brown’s estimate of 3,238 boe/d. Corresponding cash flows from operations of $0.03/share were also slightly above Browns estimate for $0.02/share. Brown says that in light of the company's November 12, 2015 take-over offer from Gran Tierra, quarterly results are less relevant as the low-end valuation for the company has essentially been set at $1.33/sh. Under the terms of the arrangement, PTA shareholders have the option to receive 0.40 of a GTE share or $1.33 cash. The PTA board of directors has unanimously approved the $84 million acquisition, which is expected to close around January 29, 2016. As for potential catalysts, Brown says that despite only having the Tautaco (LLA-10, 50% W.I.) exploration well planned for Q4, PTA has an inventory of locations planned for early 2016. Fortunately, the company is largely carried on the Tautaco well and will only pay 5.5% of drilling costs. GTE will likely commit to the drilling of two appraisal/development wells targeting "N Sand" opportunities on PTA's acreage. The company will also be carried on Tinigua-1 (Tinigua block, 40%) in 2016, paying only 10% of gross drilling costs. Overall, Brown believes the acquisition positions GTE for some near-term catalysts, with a combination of low-risk development and higher-risk exploration opportunities heading into 2016.”
@tommyThanks for asking @Vagabond, I should reflect more on it... Most importantly, I learned the market is smarter than me… PTA always looked incredibly cheap on a cash-flow basis but the market knew better.
I also got a three year intro to the oil and gas business including types of product, exploration, extraction and financing techniques, some of the issues that arise, and began to build a network of contacts I can ask dumb questions of.
I learned again to be disciplined with position sizing, especially with venture stocks or those exposed to commodity price risk, because I got carried away averaging down in the teens and am paying the price for it (Kraft Dinner).
I learned Colombia is the second best place in the world after Canada- three trips since becoming a PTA shareholder. You gotta go!
And I learned again to never let the sun set on a bid. Because it might not be there tomorrow.
If you followed me in to this name, I am sorry. I totally blew it.
Hope all is well.
SEDI_botPetroamerica Oil Corp. $PTA just filed 28 reports. View full report: SEDI:PTA
@Vagabond@tommy thanks for sharing. i made the decision to invest, so my loss is no one else's fault. $pta management could have better articulated their rationale for selling. let's hope $gte has a better outcome.