Ithaca Energy Inc. (IAE-T)

This has a stellar project in the UK. They’ve had lots of delays in getting the platform, and basically there was a lot of expectations for them to have a massive increase in cash flow a long time ago. It does look like it is going to hit this year, even with another delay. They’ll probably get production going substantially above previous levels. The stock is very, very cheap. They’ll take the cash flow and bring down debt, and the stock should get re-rated. There is plenty of potential if things go right.

This is a North Sea play. Their biggest field, Stella, is expected to come online in January. Assuming it comes online as planned, the stock looks very cheap, trading at about 4.5X debt adjusted cash flow. Its peers are trading more at 6-8 times. Expect there will be some re-rating once the Stella field comes online.

Had really liked management, but they had rebuffed a couple of takeover offers, so he sold his holdings. The North Sea is an expensive place to produce oil. They are prudent managers, so he expects they probably have a third to a half of their production hedged for 6 months to a year.

Base building through mid-’13 to mid-’13. Now it is going through a horizontal trading range. $2.30 is important support.

It should be getting Brent prices, but he has never been a fan of the North Sea.

(Looking for a short term trade.) Had a couple of tests of just under a $3 resistance point. Couldn’t break that and the most recent support of $2.54 was take out. Technically he would be a little nervous of it and would like to see it break $2.50 before getting too excited.

Believes this is worth more than what it is trading at. He exited his position because he was very frustrated that they didn’t take any the offers that came their way. Although he has a high regard for management, one of the issues is that management is well paid, but they don’t own a lot of stock, so there is no big incentive for them.

Was supposed to be a takeover quite a while ago and he lost patience with it. This one always seems to be next year’s story.

Essentially a play on North Sea oil. A development company that just manages to find ways to never deliver, it is always next year’s story. He just got tired of the name.

Buy at $2 and sell at $2.75-$3. The Street loves it. Trading well below NAV. It could be in play. Take a little profit above $2.60.

Stock has done well and still has lots of upside in bringing on new production. If you want an alternative involved in the UK North sea, look at. Sterling Resources (SLG-X). (See Top Picks.)

Exited his position a couple of months ago when they announced the Stella results and the stock bumped about 30% in a month. It always looks cheap. Because it is the North Sea with $50 million per well, some times it takes a long time. He would look at buying it back, but closer to $2. He can see $3.20 but based on track record, that would be the 2015 target.

There is continued development of the Greater Stella field in the North sea. Production has been pretty strong. Feels this is a pretty solid name. Had a few challenges with operational misses a few years back but, in the international space, this screens quite well. Looks quite attractive.

North sea oil producer. Feels it has an NAV of $3-$3.50. They were under a lot of pressure. When they took over Valliant energy and paid it off in stock, a lot of the Valliant shareholders liquidated their stock. In the Greater Stella, the 1^st well came in at over 10,000 barrels a day and they have 3 or 4 others, which got people all excited. The Valliant acquisition took them up to a higher level and it should be and could be a takeover candidate, but it is no longer a small cap, it is now a mid-cap, which should gather a lot of people’s attention. Cheap.

Excellent flow results coming out of the 1^st well from Stela. There are 4 being drilled. This justifies the $3+ NAV so it is one of the cheapest. You are paying about 1.5X cash flow which is ridiculously cheap. But, it’s North sea so it is riskier and it is $20 million a well. This will be quiet now for a couple of months.