Michael SmedleyCenturion Energy InternationalCUX.TOBUYOct 11, 2005
Have a couple of big plays with Petro Canada (PCA-T) in the Melita play in Tunisia and are a significant land holder offshore of Nigeria as well as their large holdings in Egypt. Thinks they are heading for 70,000 barrels which is a big number.
The company has had execution problems. If they can overcome these problems there will be an upside. At $7.00 it is a buy and he recommends buying it. Target price is $15.00.
Has dropped because of 3 dry and abandoned wells. Going to try and get bigger, stronger casings that can handle the pressures. Going to restart in Q1. With their 32,000 BOE's a day should do about $1.35 annualized cash flow. Under $6, it is very cheap. Buy in Q4 of 06.
Chart is pretty ugly on this name. 3 of their Algerian wells will need specialised equipment that won't arrive until September. Avoid it until you have a better feeling of the direction where things are going.