Eric Nuttall Pinecrest Energy PRY-X COMMENT Sep 25, 2013

The spurned bride at the altar. Unfortunately Bonterra (BNE-T) stepped up and did the deal with Sparton (SPA-N). This company has an excellent management team but unfortunately the market has fallen out of love with water flood projects that are embedded in their asset base. He is waiting to see how the market sorts out the relative underperformance of the water flood issues. He would like to own at a lower price.

Future is kind of murky on this one. This is a pure play, Slave Point, small cap producer that has really struggled with Slave Point. It has been a much more challenging play than expected. Doesn’t know how they get out of the spiral that they are in.

Has a tight oil asset in northern Alberta. A lot of things have gone wrong for the company in the last couple of years. As a tight oil company they faced high declines and their access to capital is basically nil. Late last year they tried an odd transaction to put themselves together with Spartan and he was very opposed to that merger. There is some value here but he wouldn’t be surprised if the board wasn’t proposing strategic alternatives.

A small cap. They have decline rates on their wells of 60-70%. It is a great package of assets for a bigger company but when you are small there is not much room for another 10 wells. They were supposed to do a merger and that got unraveled. One of the cheapest stocks in Canada but they need to find someone with a bigger pocket book to JV with.

Has been under stress because production has fallen and they are relying on their water floods to kick in further. Their reservoirs are very low energy so management has learned that they have to implement a water flood sooner than they had in the past. While they are waiting, production is falling and costs are creeping up.

Thinks operating pressures are coming to bear on this poor little enterprise. There is not a lot of downside left. There are better alternatives.

There is upside, but they have been a serial disappointer. Not what he invests in. He prefers PPY-T. Thinks PPY will sell of some assets and become even more of a pure play.

Strong concerns. Reservoir has high declines. They hoped to do water flood, but it did not meet management expectations or those of the street. Production is falling. He is not interested.

(Market Call Minute) Declining production and increasing debt to cash flow. Didn’t live up to expectations of water flooding and is on death watch.