Why sell now?
Even though they won't be going back into this until May, POE is catalyst rich with Indonesian results, additional Thai drilling and a potential Cdn heavy oil monetization coming. Trading at less than 3 X EV/CF doesn't seem like the time to sell yet.
IMPACT Positive; Adds Significant Sandstone Production
The L53-D2 discovery well and the L53-DST3 appraisal well have evaluated the first
of three fault compartments of the L53-D East Structure. Results to date have been
better than pre-drill estimates and could result in a substantial increase in reserves.
The mid-case pre-drill resource estimate of the L53-D East structure is 7.4 million
barrels (Figure 1). With development of the L53-D East structure, the majority of
POEs production will be from the more predictable sandstone reservoirs.
Action BUY on 2012 Exploration Drilling Program
POE is now focused on attaining production licenses for L53-D East
structure with drilling expected to resume in late May 2012. We maintain our BUY
recommendation and our $7.85 target price on POEs exploration and development
drilling program in Thailand and its high impact exploration drilling program in