I'm Megan Edwards for InvestmentPitch.com
Investment firm StoneCap Securities has initiated
coverage on Ithaca Energy, which is listed
in Canada and London, where is trades under
the symbol IAE on both the Toronto Stock Exchange
and the AIM.
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Analyst Victor Vallance gives the company
an outperform rating and a 12-month target
price of $3.50, which would give investors
a projected return of 43% from the $2.44 price
at the time the report was issued.
Ithaca is a North Sea oil and gas operator
focused on the delivery of lower risk growth
through the appraisal and development of UK
undeveloped discoveries, the exploitation
of its existing UK producing asset portfolio,
and a Norwegian exploration and appraisal
portfolio.
Although a Canadian company, operations are
conducted from Aberdeen, Scotland.
Ithaca has been operating in the North Sea
since 2004 when it acquired exploration blocks
during the 22nd Offshore Licensing Round.
Through participation in subsequent licensing
rounds and acquisitions, the company has accumulated
a diversified portfolio of exploration, development
and producing assets.
In April of this year, the company closed
the acquisition of Valiant Petroleum for $430
million US, for a combination of cash and
shares.
Valiant has been a "game changer" for the
company with production increasing from approximately
6,000 to 14,000 barrels of oil equivalent
per day, with 11 fields contributing to production.
Total 2P reserves for the combined company
are 69.8 million boes.
The primary growth engine for Ithaca over
the next year is the Greater Stella Area development
in which the company holds at 54.7% interest.
Ithaca's share of the 2P reserves in the Greater
Stella Area development is 33.8 million boes.
This area is surrounded by numerous producing
fields and undeveloped discoveries with major
companies holding interests in numerous fields
in addition to owning a large portion of the
operating infrastructure.
Current development activities are focused
on the construction of a new Ithaca operated
production hub.
Water depth at the site is 280 feet.
Analyst Victor Vallance stated, "When fully
on-stream, the Greater Stella Area development
is expected to contribute net to the company
16,000 barrels of oil equivalent per day,
taking total company volumes, after factoring
in declines over the next year, to over 25,000
barrels of oil equivalent per day."
The company is trading at $2.50, and with
317 million shares outstanding, is capitalized
at $794 million.
For more information, please visit the company's
website, www.ithacaenergy.com or contact Iain
McKendrick CEO at +44 (0) 1224 650 261 or
email imckendrick@ithacaenergy.com
For more information about StoneCap Securities
or to obtain additional research, contact
them at www.StoneCapsecurities.com.
I'm Megan Edwards for InvestmentPitch.com
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This video is for information purposes only
and it is not a recommendation to buy or sell
any securities.
