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Prairie Provident Resources Inc (TSX:PPR)

Summary

Prairie Provident Resources is a Toronto Stock Exchange listed oil and gas company based in Calgary, Canada. The company is focused on the exploration and development of oil and natural gas properties in the Western Canadian Sedimentary Basin in Alberta.

Market Overview

$0.42 (2.380%)
Vol 43,872.00
10 Days Avg Vol 36,873.11
3 Mo Avg Vol 62,741.77
52 Wk Lo/Hi $0.42 - $1.42
YTD Price Gain % 0%
12 Wks Moving Avg 0.531611
200 Days Moving Avg 0.630625
Market Cap 48,093,520

Company Background

Prairie Provident Resources (TSX: PPR) (“PPR”) is engaged in the exploration and development of oil and natural gas properties in the Western Canadian Sedimentary Basin in Alberta. Our conventional assets are weighted to higher-value light and medium oil, have a low base production decline and offer low-risk development. By maintaining high working interests and operatorship, we can control the pace of our capital spending which provides flexibility and drives enhanced efficiencies. We maintain an active risk management program including hedging to underpin our cash flows and protect our strong balance sheet.

Highlights

Compelling value opportunity

  • PPR is currently trading at ~35% of pro-forma PDP PV10 value.

Focused on returns

  • Disciplined approach to capital allocation and focus on projects that provide the highest IRR
  • Asset portfolio provides returns ranging from 27% - 73%(1) in current price environment, supporting organic growth and development

Oil-weighted, low-risk asset base

  • >5 years identified development drilling opportunities at Wheatland / Princess
  • Light oil waterflood project at Evi offers attractive economics + significant reserves addition potential
  • High working interest and operatorship allows control over pace of development

Financial flexibility

  • $50MM drawn on $65MM facility representing 1.3x debt / EBITDAX*; reduce to target of 1x over the coming quarters
  • Strong hedge position (40% of base gas net production at $2.79/GJ and 63% of base oil net production at C$69.51/bbl)

Share Structure

Prairie Provident
TSX: PPR
Share Structure
    Common Shares 115.9MM
    Outstanding Options 2.6MM
    Performance Stock Units 0.5MM
    Common Stock Warrants 3.2MM
Fully Diluted Shares 122.2MM
Board and Management Holdings 3%
Share Trading Activity
    3 month average daily volume(shares) 125,700
    52 week low/high ($/share) $0.59/$1.25
    Current Share Price (Date) $0.60
    Average Warrant Price $0.87
Market Capitalization (I/O) $70MM
Cash Balance -
Debt Outstanding $50MM
(all amounts as of April 24, 2017)

Other Information

Projects/Properties Information

Built an oil-weighted and low-risk asset base in Alberta focused in Wheatland / Princess and Evi.
  • Wheatland: Organically grew to ~2,500 boe/d
    • Drilled 20 successful wells & reduced capital costs from ~$2.7MM to $1.65MM per well
    • 128 sections of undeveloped land – multi-year development potential
  • Evi: Grew from 1,200 boe/d to 2,600 boe/d through synergistic acquisitions
    • Lowered area opex from $25/bbl to $19/bbl
    • Waterflood program that requires minimal capital, reduces corporate decline rates, and has the potential to double recovery rates
    • Significant undeveloped land base with identified development drilling
  • Princess: New core area established through the Arsenal merger

Management Profiles

Tim S. Granger

President & CEO

CEO Molopo Energy Limited, President and CEO of Compton Petroleum Corporation, COO Paramount Energy, Managing Director of TAQA North, COO Primewest

Mimi M. Lai

VP Finance and CFO

Vice President, Finance & Controller, Manager, Financial Reporting at Harvest Operations Corp, Sr. Manager, Financial Accounting Advisory Services Ernst & Young LLP

Robert Guy

VP Operations

Vice President Production Operations at Spyglass Resources Corp., Manager Operations at Ketch Resources Trust, Various Management Positions at Acclaim Energy Trust

Tony van Winkoop

VP Exploration

President and CEO Arsenal Energy Inc., General Manager of Development Primewest, Co-founder Venator Petroleum

Gjoa Taylor

VP Land

Vice President Land Arsenal Energy Inc. Various positions with Imperial Oil, Crestar Energy, and at PrimeWest Energy as Manager, Negotiations