Equity Capital Markets and Advisory Business, Auctus Advisors

Auctus Advisors

Equity Capital Markets and Advisory Business

Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector. The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy. Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors. Auctus provides Corporate Broking, Equity Research and Investment Banking services.

Equity Bottom-Up

<ul><li>GeoPark (GPRK US)C: Target price of US$31 per share:Two new strong development wells at CPO-5 – Two new development wells, Indico 6 and Indico 7, tested over 11,000 bbl/d gross (in aggregate) with hardly any water (Indico 6: 6,270 bbl/d, Indico 7: 5,245 bbl/d).</li><li>This would take gross production from the field from ~20 mbbl/d in 4Q22 to 25-27 mbbl/d.</li><li>OKEA Energy (OKEA NO): 4Q22 update – 4Q22 production in Norway was 19,887 boe/d.</li></ul>

GeoPark (GPRK US)C: Target price of US$31 per share:Two new strong development wells at CPO-5 – Two new development wells, Indico 6 and Indico 7, tested over 11,000 bbl/d gross (in aggregate) with hardly any water (Indico 6: 6,270 bbl/d, Indico 7: 5,245 bbl/d).This would take gross production from the field from ~20 mbbl/d in 4Q22 to 25-27 mbbl/d.OKEA Energy (OKEA NO): 4Q22 update – 4Q22 production in Norway was 19,887 boe/d.

Leading International Investment Research, Edison Investment Research

Edison Investment Research

Leading International Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

Cairn Energy&rsquo;s interim report revealed higher contingent resources at SNE of 563mmbbl, but a phased development plan targeting the lower reservoirs initially. Lower capex to first oil is balanced by a lower (and longer) plateau period of 75-125mb/d. Other offshore projects indicate that phase one will have low production rates (of perhaps 80mb/d), while we expect further phases to increase over time. As a result of these changes, and a number of other adjustments throughout our modelling (not least for the commissioning issues seen at Kraken), our contingent valuation remains broadly flat at 195p, but our RENAV increases to 205p (from 200p).

Cairn Energy&rsquo;s interim report revealed higher contingent resources at SNE of 563mmbbl, but a phased development plan targeting the lower reservoirs initially. Lower capex to first oil is balanced by a lower (and longer) plateau period of 75-125mb/d. Other offshore projects indicate that phase one will have low production rates (of perhaps 80mb/d), while we expect further phases to increase over time. As a result of these changes, and a number of other adjustments throughout our modelling (not least for the commissioning issues seen at Kraken), our contingent valuation remains broadly flat at 195p, but our RENAV increases to 205p (from 200p).

We update our valuation to reflect the Druid and SNE North well results and lower long-term oil price assumption. We look forward to the half-year results on 21 August when Cairn plans to update the market on reserves estimates and the development concept for SNE, which will help to firm up potential value for the field. After adjustments and accounting for our lower long-term oil price assumption, the contingent NAV falls to 196p (from 225p/share).

We update our valuation to reflect the Druid and SNE North well results and lower long-term oil price assumption. We look forward to the half-year results on 21 August when Cairn plans to update the market on reserves estimates and the development concept for SNE, which will help to firm up potential value for the field. After adjustments and accounting for our lower long-term oil price assumption, the contingent NAV falls to 196p (from 225p/share).

Exploration setbacks, but shares backed by core

We refresh our view on Cairn Energy, focusing on key areas of interest for investors already familiar with the company. We examine a number of valuation approaches for SNE in Senegal, the potential for reserve upgrades and exploration value. We believe SNE is an outsized asset and assume Cairn seeks to farm-down. This will naturally affect long-term value upside, but would in our view drive a better balance of asset and financial risk. We also examine features of Catcher, Cairn&#8217;s cost of capital and look at the Indian tax dispute. After a long period of value stagnation (as cash was invested to develop Catcher/Kraken), coming years could be a time when investors see a path to this investment steadily bearing fruit. Our core contingent NAV is 225p/share and our RENAV is 255p/share.

We refresh our view on Cairn Energy, focusing on key areas of interest for investors already familiar with the company. We examine a number of valuation approaches for SNE in Senegal, the potential for reserve upgrades and exploration value. We believe SNE is an outsized asset and assume Cairn seeks to farm-down. This will naturally affect long-term value upside, but would in our view drive a better balance of asset and financial risk. We also examine features of Catcher, Cairn&#8217;s cost of capital and look at the Indian tax dispute. After a long period of value stagnation (as cash was invested to develop Catcher/Kraken), coming years could be a time when investors see a path to this investment steadily bearing fruit. Our core contingent NAV is 225p/share and our RENAV is 255p/share.

United Kingdom

Capricorn Energy PLC is oil and gas exploration and development company. The Company operates in North West Europe, North Atlantic, Mediterranean, and South Asia.

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Capricorn Energy (CNE LN)

Auctus on Friday - 27/02/2023

Two new development wells, Indico 6 and Indico 7, tested over 11,000 bbl/d gross (in aggregate) with hardly any water (Indico 6: 6,270 bbl/d,...

Auctus Advisors

SNE larger but phased

Cairn Energy’s interim report revealed higher contingent resources at SNE of 563mmbbl, but a phased development plan targeting the lower reservoirs...

Edison Investment Research

Exploration setbacks, but shares backed by core

We update our valuation to reflect the Druid and SNE North well results and lower long-term oil price assumption. We look forward to the half-year...

Edison Investment Research

Producer, developer, explorer

We refresh our view on Cairn Energy, focusing on key areas of interest for investors already familiar with the company. We examine a number of...

Edison Investment Research

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