Tag: Energy

Release – Hemisphere Energy Announces Updates to Its Share-Based Compensation Plans and Grants Incentive Restricted Share Units and Stock Options

Posted on by dburczyk@noblecapitalmarkets.com

Research News and Market Data on HMENF

Vancouver, British Columbia–(Newsfile Corp. – December 16, 2024) – Hemisphere Energy Corporation (TSXV: HME) (OTCQX: HMENF) (“Hemisphere” or the “Company”) announces that its Board of Directors has approved a new Restricted Share Unit (“RSU”) Plan and made certain amendments to its existing Stock Option Plan that are intended to comply with the provisions of TSXV Policy 4.4 – Security Based Compensation, as well as other housekeeping changes, both subject to shareholder approval at the next annual general meeting in May 2025. The Company’s Board of Directors has also approved grants of incentive RSUs and stock options.

Restricted Share Units

Under the new RSU Plan, RSUs may be granted to directors, employees, and contractors of the Company. The RSU Plan permits the Company to either redeem RSUs for cash or by issuance of Hemisphere’s common shares.

On December 13, 2024, the Company conditionally awarded 930,000 incentive RSUs to directors and officers of Hemisphere, all of which will vest one-third annually over a three-year period and will expire on December 15, 2027.

The RSU Plan and the grant of the above noted RSUs each remain subject to the requisite approval of the shareholders of the Company, in accordance with the rules of the TSX Venture Exchange. These matters, as well as matters relating to the amendments and renewal of the Company’s Stock Option Plan, are expected to be presented for approval at the Company’s next annual meeting of shareholders.

Stock Options

Additionally, in accordance with the Company’s Stock Option Plan, Hemisphere has granted 48,000 incentive stock options to its investor relations service provider on December 13, 2024 at an exercise price of $1.84 per share which will vest quarterly over 12 months and expire on December 13, 2029.

About Hemisphere Energy Corporation

Hemisphere is a dividend-paying Canadian oil company focused on maximizing value-per-share growth with the sustainable development of its high netback, ultra-low decline conventional heavy oil assets through polymer flood EOR methods. Hemisphere trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol “HME” and on the OTCQX Venture Marketplace under the symbol “HMENF”.

For further information, please visit the Company’s website at www.hemisphereenergy.ca to view its corporate presentation or contact:

Don Simmons, President & Chief Executive Officer
Telephone: (604) 685-9255
Email: info@hemisphereenergy.ca

Website: www.hemisphereenergy.ca

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

info

SOURCE: Hemisphere Energy Corporation

Hemisphere Energy (HMENF) – Third Quarter Results Ahead of Expectations

Posted on by cpereira@noblefcm.com


Friday, November 22, 2024

Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Third quarter financial results. Hemisphere Energy reported third-quarter net income of C$8.6 million or C$0.09 per share compared to C$8.5 million or C$0.08 per share during the third quarter of 2023. We had projected net income of C$8.4 million or C$0.08 per share. Year-over-year, oil and natural gas revenue increased 9.6% to C$26.7 million, driven by an 18.5% increase in average daily production to 3,621 barrels of oil equivalent (BOE) compared to 3,056 during the prior year period and our estimate of 3,600. The average sales price per BOE declined to C$80.06 compared to C$86.57 in the third quarter of 2023. Adjusted funds flow from operations amounted to C$11.7 million or C$0.12 per diluted share compared to C$11.7 million or C$0.11 per diluted share during the prior year period.

Updating estimates. While our 2024 EPS estimate is unchanged at C$0.31, we have modestly lowered our adjusted funds flow estimate to C$43.5 million from C$43.8 million. We lowered our full year average daily production expectations to 3,456 barrels of oil equivalent from 3,534 to reflect down time in the fourth quarter associated with vessel inspections and maintenance. While our 2025 average daily production estimate of 3,625 barrels of oil equivalent is unchanged, we lowered our 2025 AFF and EPS estimates to C$38.0 million and C$0.27 per share from C$42.6 million and C$0.32 to reflect lower crude oil prices.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Release – Hemisphere Energy Announces 2024 Third Quarter Results, Declares Quarterly Dividend, and Provides Operations Update

Posted on by dburczyk@noblecapitalmarkets.com

Research News and Market Data on HMENF

Vancouver, British Columbia–(Newsfile Corp. – November 21, 2024) – Hemisphere Energy Corporation (TSXV: HME) (OTCQX: HMENF) (“Hemisphere” or the “Company”) is pleased to provide its financial and operating results for the three and nine months ended September 30, 2024, declare a quarterly dividend payment to shareholders, and provide an operations update.

Q3 2024 Highlights

  • Achieved quarterly production of 3,621 boe/d (99% heavy oil), an 18% increase over the same quarter last year.
  • Attained quarterly revenue of $26.7 million, a 10% increase from the third quarter of 2023.
  • Delivered operating netback1 of $15.4 million or $46.24/boe for the quarter.
  • Realized quarterly adjusted funds flow from operations (“AFF”)1 of $11.7 million or $35.17/boe.
  • Executed a $9.9 million capital expenditure program to drill eight successful wells in Atlee Buffalo, Alberta and construct a new multi-well battery and polymer injection facility in Marsden, Saskatchewan.
  • Exited the third quarter with a positive working capital1 position of $6.5 million.
  • Paid a special dividend of $2.9 million ($0.03/share) to shareholders on July 26, 2024.
  • Paid a quarterly base dividend of $2.5 million ($0.025/share) to shareholders on September 13, 2024.
  • Announced a special dividend of $0.03/share to shareholders that was paid subsequent to the quarter on October 25, 2024.
  • Renewed the Company’s Normal Course Issuer Bid (“NCIB”).
  • Purchased and cancelled 756,400 shares under the Company’s NCIB.

(1) Operating netback, adjusted funds flow from operations (AFF), free funds flow, capital expenditures, and working capital are non-IFRS measures, or when expressed on a per share or boe basis, non-IFRS ratio, that do not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other entities. Non-IFRS financial measures and ratios are not standardized financial measures under IFRS and may not be comparable to similar financial measures disclosed by other issuers. Refer to the section “Non-IFRS and Other Specified Financial Measures”.

Selected financial and operational highlights should be read in conjunction with Hemisphere’s unaudited consolidated interim financial statements and related notes, and the Management’s Discussion and Analysis for the three and nine months ended September 30, 2024 which are available on SEDAR+ at www.sedarplus.ca and on Hemisphere’s website at www.hemisphereenergy.ca. All amounts are expressed in Canadian dollars unless otherwise noted.

Financial and Operating Summary

Quarterly Dividend and Shareholder Return

Hemisphere is pleased to announce that its Board of Directors has approved a quarterly cash dividend of $0.025 per common share in accordance with the Company’s dividend policy. The dividend will be paid on December 27, 2024 to shareholders of record as of the close of business on December 13, 2024. The dividend is designated as an eligible dividend for income tax purposes.

A minimum of $21 million is anticipated to be returned to Hemisphere’s shareholders in 2024, inclusive of $9.8 million in quarterly base dividends, $5.9 million in two special dividends, and $5.3 million in NCIB share repurchases and cancellations. Based on the Company’s current market capitalization of $179 million (97.5 million shares issued and outstanding at market close price of $1.84 per share on November 20, 2024), this represents an annualized yield of 11.7% to Hemisphere’s shareholders.

Operations Update

Hemisphere’s polymer floods in Atlee Buffalo continue to perform well, with third quarter production up 18% from the same period of 2023. During the third quarter of 2024, Hemisphere drilled eight new horizontal wells into its Atlee Buffalo pools, of which three are in the F pool and five in the G pool. All but one of these wells were brought online subsequent to the end of the quarter, although at least two will ultimately be converted into injectors to continue to build reservoir pressure and sweep oil to producers in the pool.

The Company is currently adding another treater to its G pool battery to handle the additional volumes from these wells. At the same time, vessel inspection and overall maintenance is being completed across the G pool battery. Due to this downtime, management anticipates lower corporate production during the first half of the fourth quarter, with overall expectations for annual 2024 production to be in line with guidance.

In its Marsden, Saskatchewan property, Hemisphere continues to evaluate its new polymer pilot project and is awaiting source well regulatory approval in order to increase injection rates. At this time no significant production is budgeted from the area.

The Hemisphere team is currently working on development plans for next year and expects to release details on its 2025 guidance in January.

About Hemisphere Energy Corporation

Hemisphere is a dividend-paying Canadian oil company focused on maximizing value-per-share growth with the sustainable development of its high netback, low decline conventional heavy oil assets through polymer flood enhanced recovery methods. Hemisphere trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol “HME” and on the OTCQX Venture Marketplace under the symbol “HMENF”.

For further information, please visit the Company’s website at www.hemisphereenergy.ca to view its corporate presentation or contact:

Don Simmons, President & Chief Executive Officer
Telephone: (604) 685-9255
Email: info@hemisphereenergy.ca

Website: www.hemisphereenergy.ca

Forward-looking Statements

Certain statements included in this news release constitute forward-looking statements or forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as “anticipate”, “continue”, “estimate”, “expect”, “forecast”, “may”, “will”, “project”, “could”, “plan”, “intend”, “should”, “believe”, “outlook”, “potential”, “target” and similar words suggesting future events or future performance. In particular, but without limiting the generality of the foregoing, this news release includes forward-looking statements including that a quarterly dividend will be paid December 27, 2024 to shareholders of record as of the close of business on December 13, 2024; that a minimum of $21 million is anticipated to be returned to shareholders in 2024; that at least two of Hemisphere’s new wells will be converted into injectors; that management anticipates lower corporate production during the first half of the fourth quarter, with overall expectations for annual 2024 production to fall in line with guidance; and that Hemisphere expects to release details on its 2025 guidance in January.

Forward‐looking statements are based on a number of material factors, expectations or assumptions of Hemisphere which have been used to develop such statements and information, but which may prove to be incorrect. Although Hemisphere believes that the expectations reflected in such forward‐looking statements or information are reasonable, undue reliance should not be placed on forward‐looking statements because Hemisphere can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the current and go-forward oil price environment; that Hemisphere will continue to conduct its operations in a manner consistent with past operations; that results from drilling and development activities are consistent with past operations; the quality of the reservoirs in which Hemisphere operates and continued performance from existing wells; the perspectivity of recently acquired properties and the timing and manner to explore and develop the same; the continued and timely development of infrastructure in areas of new production; the accuracy of the estimates of Hemisphere’s reserve volumes; certain commodity price and other cost assumptions; continued availability of debt and equity financing and cash flow to fund Hemisphere’s current and future plans and expenditures; the impact of increasing competition; the general stability of the economic and political environment in which Hemisphere operates; the general continuance of current industry conditions; the timely receipt of any required regulatory approvals; the ability of Hemisphere to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which Hemisphere has an interest in to operate the field in a safe, efficient and effective manner; the ability of Hemisphere to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Hemisphere to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Hemisphere operates; and the ability of Hemisphere to successfully market its oil and natural gas products.

The forward‐looking statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statements, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward‐looking statements including, without limitation: changes in commodity prices; changes in the demand for or supply of Hemisphere’s products, the early stage of development of some of the evaluated areas and zones; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Hemisphere or by third party operators of Hemisphere’s properties, increased debt levels or debt service requirements; inaccurate estimation of Hemisphere’s oil and gas reserve volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time‐to‐time in Hemisphere’s public disclosure documents, (including, without limitation, those risks identified in this news release and in Hemisphere’s Annual Information Form).

The forward‐looking statements contained in this news release speak only as of the date of this news release, and Hemisphere does not assume any obligation to publicly update or revise any of the included forward‐looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

Non-IFRS and Other Financial Measures

This news release contains the terms adjusted funds flow from operations, free funds flow, capital expenditures, operating field netback, operating netback, and working capital/net debt, which are considered “non-IFRS financial measures” and any of these measures calculated on a per boe basis, which are considered “non-IFRS financial ratios”. These terms do not have a standardized meaning prescribed by IFRS. Accordingly, the Company’s use of these terms may not be comparable to similarly defined measures presented by other companies. Investors are cautioned that these measures should not be construed as an alternative to net income (loss) or cashflow from operations determined in accordance with IFRS and these measures should not be considered more meaningful than IFRS measures in evaluating the Company’s performance.

a) Adjusted funds flow from operations (“AFF”) (Non-IFRS Financial Measure and Ratio if calculated on a per share or boe basis): The Company considers AFF to be a key measure that indicates the Company’s ability to generate the funds necessary to support future growth through capital investment and to repay any debt. AFF is a measure that represents cash flow generated by operating activities, before changes in non-cash working capital and adjusted for decommissioning expenditures and may not be comparable to measures used by other companies. The most directly comparable IFRS measure for AFF is cash provided by operating activities. AFF per share is calculated using the same weighted-average number of shares outstanding as in the case of the earnings per share calculation for the period.

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InPlay Oil (IPOOF) – Expecting a Strong Finish in 2024; Outlook for 2025 Remains Positive

Posted on by cpereira@noblefcm.com


Friday, November 15, 2024

InPlay Oil is a junior oil and gas exploration and production company with operations in Alberta focused on light oil production. The company operates long-lived, low-decline properties with drilling development and enhanced oil recovery potential as well as undeveloped lands with exploration possibilities. The common shares of InPlay trade on the Toronto Stock Exchange under the symbol IPO and the OTCQX Exchange under the symbol IPOOF.

Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.

Hans Baldau, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Third quarter financial results. InPlay Oil generated third quarter net income of C$146 thousand or C$0.00 per share compared to C$9.2 million or C$0.08 per share during the prior year period. We had predicted net income in the amount of C$423 thousand or C$0.00 per share. Average quarterly production declined to 8,206 barrels of oil equivalents per day (boe/d) compared to 9,003 boe/d in the third quarter of 2023 and our estimate of 8,238 boe/d.

Corporate 2024 guidance. While InPlay has maintained its production guidance of 8,700 to 9,000 boe/d, commodity price expectations were lowered, and operating expenses are expected to be in the range of C$13.50 to C$15.50 per boe/d compared to prior guidance of C$13.00 to C$15.25 per boe/d. Capital expenditures are expected to total $63 million compared with prior guidance of C$64 million to C$67 million. Adjusted funds flow is expected to be in the range of C$70 million to C$73 million compared to previous expectations of C$80 million to C$85 million.


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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

TransAlta Finalizes Acquisition of Heartland Generation in $542 Million Deal

Posted on by slightbourne@noblecapitalmarkets.com
Key Points:
– TransAlta acquires Heartland Generation for $542 million, adjusting for asset divestitures.
– Acquisition to add 1,747 MW of capacity, enhancing TransAlta’s Alberta portfolio.
– Deal expected to yield $85-$90 million in annual EBITDA and $20 million in annual synergies.

TransAlta Corporation announced an amended acquisition agreement to purchase Heartland Generation from Energy Capital Partners (ECP) at a revised price of $542 million. This agreement, which includes the assumption of $232 million of debt, strengthens TransAlta’s presence in Alberta’s energy market, adding diverse power generation assets critical for the province’s growing needs. The transaction is expected to close by December 4, 2024, and includes the divestiture of Heartland’s Poplar Hill and Rainbow Lake assets, which account for 97 MW of power. These divestitures, required to meet federal Competition Bureau guidelines, prompted an $80 million reduction in the purchase price and will allow TransAlta to focus on core, high-value assets in its portfolio.

Heartland Generation’s assets are strategically valuable to TransAlta. By adding 1,747 MW of capacity, including gas-fired and peaking generation, as well as cogeneration facilities, TransAlta will significantly enhance its energy capabilities. This expanded portfolio is expected to be highly accretive to the company’s cash flow, contributing an estimated $85 to $90 million in annual EBITDA post-synergies and divestitures. Approximately 60% of Heartland’s revenues are under long-term contracts with an average remaining life of 15 years, ensuring steady, reliable income from high-credit, stable clients. According to TransAlta, the acquisition will yield substantial free cash flow and achieve a cash yield backed by low-cost, high-efficiency energy generation, supporting Alberta’s dynamic power needs.

CEO John Kousinioris emphasized the alignment of this acquisition with TransAlta’s growth strategy in Alberta. “The pending acquisition of Heartland will allow TransAlta to incorporate high-demand generation capabilities, enhancing our role in supporting grid reliability. Consistent with our original investment thesis, the Alberta market will increasingly require low-cost, flexible, and fast-responding generation to support grid reliability over the coming years. This transaction supports our competitive position by ensuring we maintain a robust and diversified portfolio,” he noted. The deal allows TransAlta to better meet Alberta’s evolving energy demands and gain an edge in the market by offering reliable power that complements and balances renewable energy sources, particularly as renewables are scaled up across Alberta.

TransAlta will also leverage significant operational and financial synergies by integrating Heartland’s assets. The company expects $20 million in annual synergies through shared corporate and operational costs. With TransAlta’s existing assets, the expanded scale will enable supply chain efficiencies, operational optimizations, and additional synergies that will enhance margins and support long-term growth. Heartland’s portfolio, with critical infrastructure for future hydrogen development, is also well-suited to support sustainable initiatives, aligning with TransAlta’s commitment to advancing clean energy solutions.

The transaction metrics are favorable to TransAlta’s growth outlook, with an estimated $270 per kilowatt valuation for the Heartland assets. The acquisition’s 5.4 times EBITDA multiple positions TransAlta for long-term value creation through low-cost power generation assets that are increasingly valuable in Alberta’s shifting energy landscape. With the strategic advantages of this acquisition, TransAlta’s enhanced portfolio and market reach will play a vital role in securing Alberta’s energy future.

The AI Energy Revolution: Is Nuclear Power the Next Frontier?

Posted on by slightbourne@noblecapitalmarkets.com
Key Points:
– Big Tech is driving nuclear energy investments to meet AI data center demands.
– SMRs (Small Modular Reactors) are gaining attention, but are still in the experimental stage.
– Few public investment options exist in nuclear power, though related stocks have surged.

Nuclear power is emerging as a key player in the race to meet the enormous energy demands of AI-generating data centers, as Big Tech giants look for reliable, clean energy sources to fuel their operations. In recent weeks, Microsoft, Google, and Amazon have each announced significant investments in nuclear energy, signaling that this technology could be poised for a major comeback in the U.S. energy landscape.

Microsoft’s partnership with Constellation Energy to restart the shuttered Three Mile Island nuclear reactor, Google’s collaboration with Kairos Power to harness Small Modular Reactors (SMRs), and Amazon’s $500 million investment in SMR developer X-Energy highlight a growing trend. These tech giants are betting on nuclear power as a sustainable solution to the skyrocketing energy needs of AI, cloud computing, and data center operations.

For decades, nuclear energy has contributed about 20% of the U.S. electricity supply. However, the industry has stagnated, facing stringent regulatory requirements and high costs that have made it difficult for new reactors to come online. The recent openings of reactors at the Vogtle plant in Georgia were the first new units in seven years, underlining the slow pace of expansion in this sector.

But as Big Tech’s energy consumption continues to grow, driven by the demands of AI and other data-heavy applications, nuclear power has come back into focus. The goal of SMRs is to create smaller, more flexible reactors that are cost-effective and can be built closer to the grid. These reactors have the potential to power everything from industrial operations to sprawling data centers. However, it’s important to note that these reactors are still in the experimental stage in the U.S. The first fully operational units are not expected to be online until the early 2030s, with Microsoft’s project at Three Mile Island targeting a restart by 2028.

Investors looking to capitalize on the nuclear resurgence have few direct options. Companies like NuScale Power (SMR) and Oklo (OKLO) have seen their stock prices soar as investor interest in nuclear technologies grows, but they remain speculative, given the unproven nature of SMRs. NuScale, for example, has seen its shares rise by over 450% this year alone, while Oklo, backed by OpenAI’s Sam Altman, has gained more than 80% since going public through a SPAC.

This shift toward nuclear also ties into broader trends we’ve covered recently, including the increasing focus on renewable energy solutions to power data centers. For instance, Amazon’s recent investments in small modular reactors through X-Energy are a continuation of its efforts to secure clean energy sources, mirroring its $500 million commitment to clean energy projects we wrote about earlier this week. These investments by tech companies not only signal a growing need for energy but also show a strategic shift toward sustainable, scalable solutions.

Energy companies, particularly those involved in nuclear power, utilities, and uranium production, have been significant beneficiaries of this renewed interest. Stocks of utility companies and uranium producers like Cameco (CCJ) and Uranium Energy (UEC) are near record highs as investors seek exposure to this trend. In fact, as we mentioned in our analysis of Wolfspeed’s $750 million chips grant, the intersection of tech and energy—especially AI—continues to drive investment across multiple sectors.

As AI technology continues to evolve, one thing is clear: the next frontier for tech could be nuclear power. With billions of dollars flowing into this once-stagnant industry, nuclear energy may soon be a critical component of the AI revolution. While there are still significant hurdles to overcome, Big Tech’s commitment to nuclear energy signals a major shift in how the world’s largest companies are planning to power the future.

InPlay Oil (IPOOF) – Tempering 2024 and 2025 Expectations; Rating Remains an Outperform

Posted on by cpereira@noblefcm.com


Monday, October 07, 2024

InPlay Oil is a junior oil and gas exploration and production company with operations in Alberta focused on light oil production. The company operates long-lived, low-decline properties with drilling development and enhanced oil recovery potential as well as undeveloped lands with exploration possibilities. The common shares of InPlay trade on the Toronto Stock Exchange under the symbol IPO and the OTCQX Exchange under the symbol IPOOF.

Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Lower third quarter commodity prices. During the third quarter, West Texas Intermediate (WTI) crude oil prices declined 18.2% to $68.17 per barrel and averaged $75.35 per barrel. InPlay sells oil at monthly average Edmonton Par prices which are based on the price of WTI crude oil minus quality differentials, transportation, and marketing fees. Crude oil prices have risen since the end of the quarter due to heightened geopolitical risk with WTI crude oil priced at $74.45 per barrel on October 4. WTI and Henry Hub futures prices average $71.16 per barrel and $3.40 per mcf in 2025. We note that natural gas prices in Canada were weak relative to Henry Hub prices during the third quarter.

Outlook for 2025. For 2024, the company forecast average production of 8,700 to 9,000 barrels of oil equivalent per day (boe/d). We are forecasting 2024 production of 8,682 barrels of oil equivalents per day compared to our previous estimate of 8,952 boe/d due to lower third and fourth quarter expectations. We think the company may start off with a conservative 2025 plan that targets production at the upper end of 2024 guidance and have lowered our production expectations to 8,971 from 9,638 barrels of oil equivalents per day.


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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Comstock Inc. to Acquire Quantum Generative Materials, Pioneering AI-Driven Materials Discovery

Posted on by cpatches
Key Points:
– Comstock Inc. has acquired Quantum Generative Materials (GenMat), gaining control of its AI-driven materials discovery platform and technical team, with a focus on energy applications.
– GenMat’s AI technology enables the discovery of new materials in much shorter timeframes, helping Comstock accelerate its decarbonization efforts and innovations in metals, mining, and fuels.
– Comstock plans to integrate and commercialize GenMat’s technology efficiently.

Comstock Inc. (LODE) has announced the acquisition of Quantum Generative Materials (GenMat), marking a strategic investment in artificial intelligence for advancing materials discovery, particularly in energy applications. As part of the acquisition, Comstock will gain substantially all of GenMat’s equity, including its proprietary AI-driven materials discovery platform, synthesis technologies, and most of its technical team.

Strengthening AI Capabilities for Materials Science

GenMat’s breakthrough AI platform is designed to generate new atoms, molecules, and physical systems for a wide range of material applications. By combining physics and chemistry knowledge with proprietary synthetic datasets, GenMat dramatically reduces the time required for materials discovery compared to traditional methods. This acquisition will enable Comstock to accelerate the development of new technologies focused on decarbonizing energy and other key industries.

“Our interest in GenMat was and remains grounded in the critical need for AI in materials science and mineral discovery for breakthrough energy applications,” said Corrado De Gasperis, Comstock’s Executive Chairman and CEO. “This acquisition allows us to address large market opportunities with innovative AI-driven solutions.”

Expanding Comstock’s Innovation Capacity

Kevin Kreisler, Comstock’s Chief Technology Officer, emphasized the acquisition’s impact on the company’s strategic direction. “Focusing on GenMat’s competencies in materials science and computational chemistry, combined with cutting-edge AI technologies, will strengthen our competitive edge across our metals, mining, and fuels businesses,” Kreisler stated. “This acquisition expands our innovation capacity and reinforces our commitment to systemic decarbonization.”

Streamlining the Acquisition and Future Plans

Comstock’s original 2021 investment agreement with GenMat was a milestone-based deal worth $50 million for 50% of GenMat’s equity. With this new acquisition, all prior agreements between the two companies have been terminated. Comstock expects to integrate and commercialize GenMat’s AI platform efficiently, reinforcing its position in the materials science and energy sectors.

Watch Comstock’s fireside chat from Noble’s Emerging Growth Basic Industries Virtual Conference

Hemisphere Energy (HMENF) – Hemisphere Provides an Operational Update and Declares a Special Dividend

Posted on by cpereira@noblefcm.com


Thursday, September 26, 2024

Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Operational update. Hemisphere has drilled six horizontal wells into its southeast Alberta Atlee Buffalo F and G pools over the past two months, with two wells left to drill as part of its summer program. Drilling operations are expected to be completed early in the fourth quarter with wells put into production as they are tied-in through the remainder of the year. Hemisphere has also commenced polymer injection at its new pilot enhanced oil recovery project in Marsden, Saskatchewan. Management anticipates that it could take until mid-2025 to increase reservoir pressure and to evaluate the production response at the three producers.

Updating estimates. Crude oil prices have weakened since our last update. We have lowered our 2024 adjusted funds flow (AFF) and earnings per share (EPS) estimates to C$43.8 million and C$0.31, respectively, from C$45.4 million and C$0.35. Our third and fourth quarter EPS estimates were lowered by C$0.02 each to C$0.08 and C$0.06, respectively, based on average per barrel WTI crude oil prices of $75.69 and $71.20. While futures prices suggest 2025 WTI pricing in the $68 to $70 per barrel range, we are leaving our 2025 estimates unchanged for now based on a WTI crude oil price of $74.95 per barrel.


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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Gevo Acquires CultivateAI to Strengthen Verity’s Carbon Accounting Solutions

Posted on by slightbourne@noblecapitalmarkets.com
Key Points:
– Gevo acquires CultivateAI for $6 million to boost Verity’s carbon tracking capabilities.
– The acquisition will accelerate revenue growth and provide advanced agricultural analytics.
– CultivateAI’s SaaS platform integrates real-time agricultural data, driving sustainability and profitability for farmers.

Gevo, Inc. (NASDAQ: GEVO), a renewable energy and carbon solutions company, has announced the acquisition of Cultivate Agricultural Intelligence, LLC (“CultivateAI”) for $6 million in cash. This strategic acquisition will bolster Gevo’s Verity business unit, accelerating the development of Verity’s carbon tracking capabilities, while integrating new revenue streams from CultivateAI’s agricultural data and analytics platform.

CultivateAI, a cloud-based software as a service (SaaS) platform, provides agricultural operators with real-time analytics, helping them make data-driven decisions to improve productivity, sustainability, and profitability. With expected 2024 revenue of $1.7 million and positive cash flow, CultivateAI is already a proven business. Gevo aims to leverage this platform to strengthen Verity’s carbon accounting and tracking solutions, focusing on carbon abatement across sectors like food, feed, fuels, and industrial markets.

Dr. Paul Bloom, Head of Verity and Chief Carbon Officer of Gevo, expressed excitement about the acquisition: “Adding CultivateAI and its inventive approach to Verity will help us grow revenue by providing the most complete set of data-driven analytics services to farmers, agronomists, and researchers. This acquisition accelerates our ability to deliver value to our customers.”

Verity’s primary focus is creating an innovative platform that tracks, verifies, and empirically values carbon intensity throughout the entire carbon lifecycle. With the addition of CultivateAI’s tools and customer base, Verity will extend its reach beyond biofuels and tap into new revenue streams. This integration is poised to strengthen Gevo’s role in promoting sustainability and profitability, particularly for farmers and agricultural service providers.

Gevo’s CEO, Dr. Pat Gruber, emphasized the broader implications of the acquisition: “We are constantly looking for development opportunities that bring new revenue streams to the company. As Verity accelerates, we expect to see more customer relationships and growth opportunities, supporting our mission to build a circular economy.”

CultivateAI’s advanced platform, with its real-time data capabilities, will allow Verity to offer the highest quality carbon abatement solutions while helping clients understand their operations better. The SaaS platform enables farm operators, agronomists, and researchers to access timely, reliable insights, enhancing their ability to manage resources efficiently and sustainably.

Gevo is committed to converting renewable energy and biogenic carbon into sustainable fuels and chemicals with a net-zero or better carbon footprint. With this acquisition, the company takes another step toward its mission of fostering a sustainable, circular economy while driving shareholder value through scalable revenue growth.

As Verity continues to expand its platform, the integration of CultivateAI will not only help improve agricultural operations but will also support the carbon footprint reduction efforts in various industries. By offering clients innovative, data-driven solutions, Gevo aims to lead the way in sustainability-focused business practices.

Release – Hemisphere Energy Declares Special Dividend and Provides Operations Update

Posted on by dburczyk@noblecapitalmarkets.com

Research News and Market Data on HMENF

Vancouver, British Columbia–(Newsfile Corp. – September 24, 2024) – Hemisphere Energy Corporation (TSXV: HME) (OTCQX: HMENF) (“Hemisphere” or the “Company”) is pleased to announce that its board of directors has approved the declaration of a special dividend to shareholders and provide an update from field operations.

Special Dividend

Given the strong financial position and performance outlook of the Company, Hemisphere is pleased to announce that its board of directors has approved the declaration of a special dividend of C$0.03 per common share, in accordance with its dividend policy. The special dividend will be paid on October 25, 2024 to shareholders of record on October 11, 2024, and is designated as an eligible dividend for Canadian income tax purposes. It is in addition to the Company’s quarterly base dividend of C$0.025 per common share.

Hemisphere has committed $17.4 million to shareholder returns to date in 2024, including quarterly base dividend payments in February, June, and September, special dividend payments in July and October, and shares repurchased and cancelled under the Company’s normal course issuer bid. This return of capital is funded entirely by the Company’s free cash flow, and is made possible by its high netback, ultra-low decline enhanced oil recovery (“EOR”) assets.

Operations Update

The Company has drilled six successful horizontal wells into its southeast Alberta Atlee Buffalo F and G pools over the past two months, with two remaining wells to drill as part of its summer development program. Drilling operations are expected to be finished early in the fourth quarter, and wells brought on production as they are tied-in through the remainder of the year.

Hemisphere has also commenced polymer injection at its new pilot EOR project in Marsden, Saskatchewan. Management anticipates that it could take until mid-2025 to increase reservoir pressure and evaluate production response at the three producers.

About Hemisphere Energy Corporation

Hemisphere is a dividend-paying Canadian oil company focused on maximizing value per share growth with the sustainable development of its high netback, ultra-low decline conventional heavy oil assets through polymer flood EOR methods. Hemisphere trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol “HME” and on the OTCQX Venture Marketplace under the symbol “HMENF”.

For further information, please visit the Company’s website at www.hemisphereenergy.ca to view its corporate presentation or contact:

Don Simmons, President & Chief Executive Officer
Telephone: (604) 685-9255
Email: info@hemisphereenergy.ca

Website: www.hemisphereenergy.ca

Forward-looking Statements

Certain statements included in this news release constitute forward-looking statements or forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as “anticipate”, “continue”, “estimate”, “expect”, “forecast”, “may”, “will”, “project”, “could”, “plan”, “intend”, “should”, “believe”, “outlook”, “potential”, “target” and similar words suggesting future events or future performance. In particular, but without limiting the generality of the foregoing, this news release includes forward-looking statements including that a special dividend will be paid to shareholders on October 25, 2024 to shareholders of record on October 11, 2024; plans for drilling two remaining wells in its southeast Alberta Atlee Buffalo F and G pools with drilling operations expected to be finished early in the fourth quarter with wells brought on production as they are tied-in through the remainder of the year; and management’s expectation that it could take until mid-2025 to increase reservoir pressure and evaluate production response at three producers at its new pilot EOR project in Marsden, Saskatchewan.

Forward‐looking statements are based on a number of material factors, expectations or assumptions of Hemisphere which have been used to develop such statements and information, but which may prove to be incorrect. Although Hemisphere believes that the expectations reflected in such forward‐looking statements or information are reasonable, undue reliance should not be placed on forward‐looking statements because Hemisphere can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the timing for payment of the special dividend; no delays in the anticipated timing for delivery of the polymer skid and EOR project; the general continuance of current industry conditions; the timely receipt of any required regulatory approvals; the ability of Hemisphere to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which Hemisphere has an interest in to operate the field in a safe, efficient and effective manner; the ability of Hemisphere to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Hemisphere to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Hemisphere operates; and the ability of Hemisphere to successfully market its oil and natural gas products.

The forward‐looking statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statements, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward‐looking statements including, without limitation: changes in project timelines and workstreams; changes in commodity prices; changes in the demand for or supply of Hemisphere’s products, the early stage of development of some of the evaluated areas and zones; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Hemisphere or by third party operators of Hemisphere’s properties, increased debt levels or debt service requirements; inaccurate estimation of Hemisphere’s oil and gas reserve volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time‐to‐time in Hemisphere’s public disclosure documents, (including, without limitation, those risks identified in this news release and in Hemisphere’s Annual Information Form).

The forward‐looking statements contained in this news release speak only as of the date of this news release, and Hemisphere does not assume any obligation to publicly update or revise any of the included forward‐looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Fed’s Rate Cut Offers Limited Relief for U.S. Factories Amid China Competition

Posted on by slightbourne@noblecapitalmarkets.com
Key Points:
– The Federal Reserve’s recent rate cut provides only marginal benefits to U.S. manufacturers.
– Rising raw material costs and competition from Chinese imports continue to challenge the U.S. manufacturing sector.
– Energy price hikes and potential port strikes add to the pressures faced by U.S. factories.

The Federal Reserve’s recent decision to cut interest rates by half a percentage point has sparked hope among some U.S. manufacturers. However, for many factory owners, the benefits of the rate reduction are overshadowed by ongoing challenges, including competition from China, high raw material prices, and labor disruptions.

Drew Greenblatt, president of Marlin Steel, a small manufacturer of wire baskets in Baltimore, represents one such case. His business had seen a surge in demand during the COVID-19 pandemic when a major client shifted orders from China to the U.S. However, this boost was short-lived, as the customer reverted back to cheaper Chinese suppliers, leaving Greenblatt grappling with surplus capacity and excess workers.

“The rate cut is welcome, but it doesn’t solve the real issue,” Greenblatt said. “We need more aggressive trade actions to level the playing field.”

The Federal Reserve’s rate cut is the first in several years, aimed at stimulating economic growth by making borrowing more affordable for businesses. In theory, lower interest rates should spur investment and expansion, but for manufacturers like Greenblatt, the rate reduction doesn’t alleviate the more significant issues plaguing the sector.

U.S. manufacturers continue to face heightened competition from low-cost Chinese imports. Despite tariffs and trade restrictions, companies often find themselves losing business to Chinese firms that offer more affordable products. In many cases, even with lower interest rates, the cost advantage of Chinese imports is too great for U.S. factories to overcome.

“The rate cut doesn’t fix supply chain issues or lower raw material costs,” said Cliff Waldman, CEO of New World Economics. “These are the real concerns U.S. manufacturers are dealing with, and lower borrowing costs won’t solve those problems.”

While competition from overseas remains a significant concern, domestic challenges also compound the difficulties faced by U.S. manufacturers. Rising electricity costs, particularly in states like California, are taking a toll on energy-intensive industries. Kevin Kelly, CEO of Emerald Packaging, shared how his family-run business, which produces plastic bags for produce companies, saw a steep rise in electricity costs over the summer.

“We just didn’t anticipate such a sharp increase in our power bill,” Kelly said. “We’ve had to adjust our production schedule and shut down some operations during peak hours, but it’s still eating into our profitability.”

The specter of labor unrest and potential port strikes further exacerbates the challenges. With a possible strike looming at major East Coast and Gulf of Mexico ports in October, manufacturers fear disruptions in supply chains, which could cause delays and drive up costs. This would be another setback for U.S. factories that are already navigating supply chain bottlenecks and inflationary pressures on inputs.

For many manufacturers, the Fed’s interest rate cut, while beneficial, offers only limited relief. Supply chain disruptions, rising raw material and energy costs, and stiff competition from Chinese imports present much more significant hurdles.

As Greenblatt noted, “The rate cut helps, but it’s just a small piece of a much bigger puzzle. We need stronger trade policies and measures that address the root causes of our struggles.”

The U.S. manufacturing sector, once a cornerstone of economic growth, now finds itself in a precarious position. While the rate cuts may provide a short-term boost, longer-term solutions are required to address the structural challenges the industry faces. Without significant reforms in trade policies and support for domestic production, manufacturers will continue to struggle despite favorable interest rates.

Uranium Energy Corp Expands U.S. Production with Strategic Acquisition of Sweetwater Plant and Uranium Assets

Posted on by slightbourne@noblecapitalmarkets.com
Key Points:
– UEC acquires Rio Tinto’s Sweetwater Plant and uranium projects in Wyoming for $175 million.
– This acquisition adds 175 million pounds of uranium resources and expands UEC’s third U.S. hub-and-spoke production platform.
– UEC strengthens its position in the uranium market amidst growing domestic energy demand and geopolitical pressures.

In a significant move to strengthen its foothold in the U.S. uranium market, Uranium Energy Corp (NYSE American: UEC) announced its acquisition of Rio Tinto’s Sweetwater Plant and uranium assets in Wyoming. This transaction marks a crucial expansion for UEC, positioning the company as a dominant player in the growing domestic uranium industry.

The $175 million deal includes Rio Tinto’s fully licensed Sweetwater Plant and a portfolio of uranium mining projects, amounting to approximately 175 million pounds of historical uranium resources. The acquisition is part of UEC’s strategy to establish a third hub-and-spoke production platform, building on its already extensive portfolio in the Great Divide Basin of Wyoming.

Strategic Importance of Sweetwater Plant

The Sweetwater Plant, located near Rawlins, Wyoming, is a 3,000-ton-per-day conventional processing mill with a licensed capacity of 4.1 million pounds of U3O8 per year. It is one of the few facilities in the U.S. capable of handling uranium processing, and its acquisition significantly boosts UEC’s processing capabilities. Originally operated from 1981 to 1983, the plant has been on care and maintenance since but remains in excellent condition, offering UEC the opportunity to bring it online with minimal capital investment.

With this acquisition, UEC can now tap into both in-situ recovery (ISR) and conventional uranium mining methods. Approximately half of the newly acquired uranium resources are amenable to ISR mining, which UEC intends to prioritize for near-term production. The remaining conventional mining resources offer long-term production growth potential.

Synergies and Expansion in Wyoming

UEC already controls 12 uranium projects in the Great Divide Basin, and the addition of Rio Tinto’s assets creates significant synergies for the company. The Sweetwater Plant’s strategic location allows UEC to streamline its production processes, leveraging shared infrastructure and expertise across its Wyoming projects. The acquisition also includes over 53,000 acres of exploration land, offering extensive opportunities for further resource development.

This deal also highlights the scalability of UEC’s business model. By acquiring the Sweetwater Plant and surrounding assets, UEC is not only increasing its uranium production capabilities but also enhancing its ability to meet growing demand for nuclear energy in the U.S., particularly in light of the recent domestic uranium import ban from Russia.

Amid Growing Geopolitical and Energy Pressures

The acquisition comes at a time of heightened interest in domestic uranium production, driven by geopolitical factors and the increasing demand for clean energy. Recent U.S. government policies, including the Department of Energy’s initiatives to purchase domestically sourced uranium, have underscored the importance of securing reliable, homegrown energy resources. UEC’s acquisition of these assets aligns with these national priorities, positioning the company as a key player in the U.S. energy transition.

Additionally, the demand for uranium is rising as the U.S. energy sector seeks to reduce reliance on fossil fuels. Nuclear power, which provides carbon-free energy, is expected to play a vital role in supporting the country’s shift toward renewable energy sources. UEC’s expansion positions the company to meet this demand while solidifying its status as one of the largest North American uranium producers.

Looking Ahead

With this acquisition, UEC is on track to further strengthen its position in the U.S. uranium market. The company’s management, led by CEO Amir Adnani, has expressed optimism about the future of uranium in the U.S. and the global market. UEC is continuing its strategy of expanding its production capabilities while focusing on low-cost, environmentally friendly ISR mining methods.

The completion of this transaction is expected in the fourth quarter of 2024, pending customary regulatory approvals.