John O'Connell, CFA
Bronco Energy
BCF-T
TOP PICK
Mar 03, 2008
(A Top Pick Mar 30/07. Up 34%.) Has a lot of oil in the ground with about 45 wells now and should average about 200 barrels a day and exit this year at about 8000/10,000 a day. Good management. On first natives land so is not affected by Alberta's royalty review.
Had experienced some delays and facilitate constraints in production. The play itself makes a lot of sense. Could get to $15-$16 on success of execution. If you believe in heavy oil and the differential, which is very narrow right now, management is one of the better ones.
New management team raised a convertible debenture. An issue would be their asset base. It will be a struggle as other companies have tried to drill it up but have abandoned it because of too much water.