ProActive Investors UK
Pura Vida Energy has a 75 per cent interest in the Mazagan Offshore Area. Mazagan is located off the coast of Morocco in the Atlantic. We have modern, high quality 3D seismic data over the block with independently certified potential resources of more than a billion barrels of oil. The Toubkal prospect alone has a potential resource range of 180 million to 1.670 billion barrels of oil, with a mean estimate of 790 million barrels of oil. Toubkal is an analogue of the billion barrel Jubilee field in Ghana – the largest oil discovery made in West Africa in the past decade.
Pura Vida trades at substantial discount to peers, says N1 Brewin
According to broker N1 Brewin, Pura Vida is trading at a dubstantial discount to its peer groupBroker N1 Brewin said Morocco focused oil group Pura VidaEnergy (ASX:PVD) is trading at a substantial discount to its peers and repeated its ‘buy’ recommendation on the stock.
Additionally, analyst Tracy Mackenzie said investors should be expecting “high impact events” in the near term.
These could include additional resources, farm-out negotiations, which could provide further funding for the drill programme, and acquisitions.
The note from Brewin followed last week’s A$3 million fundraising at a price of 25 cents per share. According to Mackenzie, this gives the company enough cash for its work programme through to farming out to fund a drilling programme.
After the fundraising, Brewing adjusted Pura Vida’s target price to A$87 cents from 95 cents, which represents a massive premium of 228 percent to the current market value.
“With Kosmos having completed 2,500km of 3D seismic on its adjacent blocks recently, and a decision to drill in 2013 expected to be taken at the year end, we expect attention to turn increasingly to Morocco,” said Mackenzie.
“We would also expect PVD to be able to have a better chance of farmout (on better promote terms) given the newly enhanced database and additional play type.”
Pura Vida has estimated the total net resources potential of its Mazagan permit offshore Morocco at 2.4 billion barrels attributable to its 75 percent stake, while Mackenzie included only prospective resources of one billion barrels in her valuation, and assumed a farm-down to 37.5 percent.
The rating average of the company’s peers has fallen to 30 cents per barrel of prospective resource from 70 cents per barrel in February, which still represents a significant premium to Pura Vida’s average of eight cents per barrel.
For comparison, the company’s closest peer Tangiers Petroleum is trading at an average of 60 cents per barrel.
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