Natural Gas Market is Heating Up and Peyto is Primed to Take Advantage

Company Peyto is an explorer and producer of unconventional natural gas in Alberta's Deep Basin. Our industry leading cost structure and focus on profitability make us unique in the Canadian Energy Industry Summary Natural gas prices have skyrocketed recently due to cold snap across US and are up 70% YoY Significant investment by PEY in 2020 to build Natural Gas supply at lowest cost in companies history and acquire stable assets Project expenditures and acquisitions are all funded by free cash flow Growth in 2021 Projects: The Board of Directors of Peyto has approved a 2021 capital budget, inclusive of acquisitions, of $325-$350 million which, at the high end, is 48% greater than the $236 million invested in 2020. Gas: January 2021 production averaged approximately 89,000 boe/d inclusive of the recent acquisitions, up 13% over January 2020. http://www.peyto.com/Files/Presentations/2021/2021Feb17CorpPres.pdf Market Outlook for Canadian Natural Gas Producers Canadian natural gas producers are bouncing back faster from the COVID-19 pandemic than battered U.S. shale firms, putting them in position to boost net gas exports to the United States for the first time in five years. "What we believe is driving some of the increase in expected capital spending for 2021 is for Canadian natural gas producers to capture market share from the reduction in associated natural gas due to the slowdown of drilling and production in a number of the large U.S. shale basins," said Tim McMillan, chief executive of the Canadian Association of Petroleum Producers (CAPP). Net Canadian gas exports jumped by 31% year-on-year to 6.3 billion cubic feet per day (bcfd) in January, the most in a month since March 2018, according to data provider Refinitiv. https://www.reuters.com/article/us-canada-natural-gas-idUSKBN2AG0EG

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Natural Gas Market is Heating Up and Peyto is Primed to Take Advantage

Feb 18, 2021

bullish

general Analysis

[1 min Read]

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Company

Peyto is an explorer and producer of unconventional natural gas in Alberta's Deep Basin. Our industry leading cost structure and focus on profitability make us unique in the Canadian Energy Industry

Summary

  • Natural gas prices have skyrocketed recently due to cold snap across US and are up 70% YoY
  • Significant investment by PEY in 2020 to build Natural Gas supply at lowest cost in companies history and acquire stable assets
  • Project expenditures and acquisitions are all funded by free cash flow

Growth in 2021

  • Projects: The Board of Directors of Peyto has approved a 2021 capital budget, inclusive of acquisitions, of $325-$350 million which, at the high end, is 48% greater than the $236 million invested in 2020.
  • Gas: January 2021 production averaged approximately 89,000 boe/d inclusive of the recent acquisitions, up 13% over January 2020.

http://www.peyto.com/Files/Presentations/2021/2021Feb17CorpPres.pdf

Market Outlook for Canadian Natural Gas Producers

  • Canadian natural gas producers are bouncing back faster from the COVID-19 pandemic than battered U.S. shale firms, putting them in position to boost net gas exports to the United States for the first time in five years.
  • "What we believe is driving some of the increase in expected capital spending for 2021 is for Canadian natural gas producers to capture market share from the reduction in associated natural gas due to the slowdown of drilling and production in a number of the large U.S. shale basins," said Tim McMillan, chief executive of the Canadian Association of Petroleum Producers (CAPP).
  • Net Canadian gas exports jumped by 31% year-on-year to 6.3 billion cubic feet per day (bcfd) in January, the most in a month since March 2018, according to data provider Refinitiv.

https://www.reuters.com/article/us-canada-natural-gas-idUSKBN2AG0EG

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PEY.TO

Peyto Exploration & Development Corp.

13.05

0.44
3.49%

Return

-
Position Return %
0.00
Position Return
5.40
Price When Posted

Metrics

5.94
Target Price
9/ 10
Confidence
1-2 Months
Timeframe
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