Avanti Energy (AVN.V)

Used to own. Taking longer to get contracts and production in place. Not there yet, but will be in 2026. Once cashflow comes on, will be able to do more drilling and sell more product.

Lots of high-tech applications, not just balloons ;) Took longer than expected to secure an offtake agreement, but now they have one. Now the task is to install small production facilities that sit on-site. Plan is to get the facility up and running, start producing, get cashflow, and then pursue longer-term contracts at higher prices.

Very small cap in the helium space. Just hasn't been able to get the execution they were hoping for. Helium market has been volatile, but the market is really expanding. Huge opportunity longer term as demand ramps up and supply in NA becomes steady. Raised money to stay afloat. 

Pipeline in place right now, waiting for facilities. Big thing right now is a pending sales agreement. Management confirms this week that helium price has a chance to move up, and focus is on getting the sales agreement done. Once the agreement is in place, you can step in with a bigger position, because company can then secure debt, build out facilities, and start producing.

Are in helium in Canada and U.S. with 3 successful wells. After drilling, they're now getting that helium to market. A US partner will process the gas. What price will they get? They project $20-30 million which would allow them to drill even more wells. Helium is far more stable than natural gas. he expects a January effect for AVN. Last year, they raised money for production but impatient shareholders sold, and they've seen tax-loss selling last month. It's one of his larger holdings.

Now has a production partner, and they're building production facilities with estimated placement by late 2023/early 2024. Waiting for a contract, and what the price will be. He expects cashflow in 2024 of $25M.

Believes large opportunity in Helium sector.
Stable demand for Helium - good for business model.
Management team transitioning from energy sector.
Facility in place to process Helium gas.
Expecting production in early 2024.
Free cash flow expected @ ~$40 million in 2025.
Very under followed/under valued stock.

Very impressed from an operational standpoint. Market has oversold stock. Drilled wells that have been successful (top 3 in North America). Recent fundraising cancelled due to weak share price. Drilling program is risky. Complex financing strategy has put pressure on the share price. Continues to hold shares and likes the company.