I do Agree she looks set to RUN hard NWE on a chart perspective and on Spec fundamentals ATM i pulled this post from HC not a bad post on the fundies
Here's a reminder of the issues surrounding NWE and my opinion of it as an investment/trade from current levels.
-note: i haven't included NWE's recent acquisitions which have further added value to the stock.
"I was on KAR, MEO, BUY and BCC but i must admit none of those multi-baggers excited me as much as this stock.
The company has been around for over 10 years and pre-GFC was trading at over 30c. It is currently trading at 3cand i believe the company is in much better shape now than it was before.
Here's why:
a) EXCELLENT MANAGEMENT:
The recently appointed chairman, Michael Fry is a real Gem.
He also happens to be the Chairman of Redfork Energy (RFE). I'm sure everyone knows about the magnificent run of RFE over the last 12-18 months. Michael has increased RFE's market capital by 500%. This guy is connected.
b) ONGOING INCOME STREAM - PRODUCTION/ROYALTIES:
---1) Vulcan/Puffin:
NWE has a 1.25% overriding royalty which up until production was halted by AED and its partners was netting NWE around $2.2m. This income stream has recently been confirmed to re-commence.
The immediate NPV of Puffin is approximately $15 million
based on over 20Mbls of oil reserves (p50).
*This alone equates to a share price of 2.9 to 3c! (current price)
---2) Jingemia, Onshore Perth Basin:
NWE has a 1.278% working interest. This deal, although not large, provides the company with another income stream which has thus far netted in excess of $3million.
c) MASSIVE, HIGH IMPACT DRILLING PROJECTS THAT WILL SIGNIFICANTLY RE-RATE THE COMPANY:
---1) The game-breaker (TP15) - Perth Basin(100% interest).
Comprises the potentially massive Xanadu project. Once the general investment community become aware of this, i honestly believe that NWE will rapidly test its previous high's (10c minimum upto 30c)-important to remember that
there was a massive discovery nearby (ROC's Cliffhead Oil Field), improving the prospectivity of the area.
Let there be no doubt that this is a potential Company maker and has been compared with BUY's PEP11 (the share price of which went from 3c to 17c in anticipation of drilling and news of farm-out - and its important to note that BUY only has a 15% free carried interest at PEP 11 while NWE has 100% interest in TP15!)
We are eagerly waiting for survey updates, farm out news etc.
From the quarterly activities report:
"Norwest now holds 100% interest in the TP-15 licence having acquired an additional 90% interest earlier this year from ROC Oil (WA) Pty Limited (ROC) and ARC Energy Limited (ARC) and it is already discussing farm-in opportunities with a number of parties. It is also important to note that the TP/15 permit has a number of significant leads and prospects and is located in a region with producing oil and gas fields including the Cliff Head oil field to the west (seaward ) and the Jingemia, Hovea and Dongara onshore producing fields to the east. The TP/15 License will be the key focus area for Norwest over the next 12 months. The Xanadu West prospect is currently the prime target within TP-15 with potential volumes - P50 at, 90 million barrels of oil in place based on mapping and available data.
The company plans to drill at least one, and possibly both, of these targets during 2010 and is now focusing on progressing both the drilling and farm-out processes. Importantly, both wells can be drilled from onshore sites using deviated drilling techniques.
Following the preliminary review of the FTG survey, Norwest now has enough information to confidently work on identifying and securing a suitable drill rig, and to begin the planning and permitting processes for drilling either, or both prospects in Q4/2010. In parallel, the company will further evaluate data from the FTG survey in conjunction with other data in order to mitigate risk and determine the optimum drill sites.
TP/15, whilst situated in a working petroleum basin, has been underexplored and through the use of the low-cost, high-technology FTG, Norwest has unlocked the potential of TP/15.
Xanadu has a potential of 98MMbbl oil in place and 27MMbbl recoverable. The prime targets are the High Cliff Sandstones and Wagina Sandstones, which are the producing reservoirs for several fields in the northern Perth Basin, including the 60MMbbl oil in place, Cliff Head project, 10km north-west of Xanadu.
Norwest is in ongoing farm-out discussions with several potential partners and now with the FTG results to hand, it is expected that these negotiations will gather pace."
---2) THE UNITED KINGDOM (Onshore southern England)
- Permit 238, Dorset (NWE 50% interest & Operator) comprises over 200 sq. kms right next door to BP's giant Wytch Farm oil field which has total est. reserves of 500mbls of oil (current worth = approx $35Billion!).
The Seismic Surveys are currently being interpreted and additional geological information is also being purchased - these results should be released any time now and again, could re-rate the company massively.
- Permit 239, Isle of Wight (NWE 75% interest & Operator) again, Seismic & GGI Surveys have been completed and are currently being interpreted - these results should also be out any time now.
d) DIVERSITY OF PROJECTS - many feathers in their cap.
---1) EP/368 & EP/426 - North Erregulla, Perth Basin (20% interest in each).
Oil targets of 30Mbls of oil! Seismic surveys will be undertaken once approvals are received for an equity swap of JV partner-also presumably this year.
In conclusion, NWE is an extremely under-priced company which has a multitude of high impact projects which will no doubt capture the attention of investors in the not to distant future. Add to this a gun management team and a regular income stream at no cost to them and you have the ingredients of a high quality investment.
IMO the most enticing part is that all of NWEs projects mentioned above (Puffin notwithstanding) are currently valued at zero (Puffin royalty alone at present is worth a share price of 3c). How's that for upside?
With so many company-making projects and so much news on the way, this is a pretty obvious buy.
I have a decent holding in NWE and my investment strategy is to sell a portion of my holdings between 6-8c to enable me to free carry the remaining parcel - which i will hold to the commencement of Xanadu and Dorset drilling.
Please do your own research and don't base your investment decisions on anything contained within my post."