02:42:04 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Energy Summary for June 8, 2015

2015-06-08 20:00 ET - Market Summary

This item is part of Stockwatch's value added news feed and is only available to Stockwatch subscribers.

Here is a sample of this item:

by Stockwatch Business Reporter

West Texas Intermediate crude for July delivery lost 99 cents to $58.14 on the New York Merc, while Brent for July lost 62 cents to $62.69 (all figures in this para U.S.). Western Canadian Select traded at a discount of $7.65 to WTI ($50.49), up from a discount of $7.90. Natural gas for July added 11.5 cents to $2.70. The TSX energy index lost 5.17 points to close at 211.15.

Massimo and Bruno Geremia's Manitok Energy Inc. (MEI) lost 19 cents to 78 cents on 640,100 shares. Investors disliked its planned $25-million private placement, as well as the news that it has delayed a $61.5-million asset acquisition that was supposed to close last week. The assets are producing 1,800 barrels of oil equivalent a day (compared with Manitok's first quarter production of about 4,500 barrels a day) and are in the Wayne area of southeast Alberta, just east of the company's core Entice lands. Manitok announced the acquisition in early May and said it should close around June 1. Today, the date was pushed back to June 12. Manitok has also changed the way it plans to finance this purchase. It previously said the money would come from the $47-million sale of a production royalty on its Stolberg assets farther north, plus up to $20-million of "infrastructure-based facility financing" (which Canaccord Genuity analysts Anthony Petrucci and Jeff Ebbern reckon is a sale-and-leaseback arrangement). Now, however, Manitok says the money will come from a production royalty sale of an unspecified amount, an infrastructure-based financing of an unspecified amount and the above-mentioned $25-million private placement. The private placement will close around the same time as the acquisition and comprise common shares and flow-through shares issued at prices ranging from 80 cents to 95 cents. This means Manitok will issue 26 million to 31 million shares, compared with its current share count of 65 million. That is a lot of dilution, but the company needs to close the acquisition on time or it will lose its $8.2-million deposit. It also just needs money in general. As of March 31, according to SEDAR filings, Manitok was $75.3-million drawn on its bank line, which used to be $90-million but will be lowered to $75-million around mid-June. That puts pressure on its ability to meet its spending commitments, namely the $21-million it is obligated to spend at Entice over the second half of the year. The SEDAR filings also show that Manitok promised its lender that it would raise at least $5-million in a debt or equity financing by July 31. The $25-million private placement is higher than investors seem to like, but the company evidently finds it necessary.

The remainder is available to Stockwatch subscribers.
Sign-up for a FREE 30-day Stockwatch subscription and SEE NO ADS

© 2024 Canjex Publishing Ltd. All rights reserved.


Reader Comments - Comments are open to paying subscribers of Stockwatch and unmoderated, although libelous remarks, obscene language and impersonations may be deleted. Opinions expressed do not necessarily reflect the views of Stockwatch.
For information regarding Canadian libel law, please view the University of Ottawa's FAQ regarding Defamation and SLAPPs.


Comments for this item are closed