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Canacol Energy

TSX: CNE

Market CapC$341m

Last Close C$2

Canacol Energy is a natural gas exploration and production company primarily focused on Colombia.

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Investment summary

Canacol offers investors a pure play on the Colombian natural gas market where it holds a c 20% market share of national demand. A newly secured gas sales contract will connect the company to interior markets via a new pipeline to be completed by 2024. In 2022 the company upgraded its net unrisked prospective resources from 5.7tcf to 20.5tcf, and is focused on converting this into reserves. The 12-well 2022 drilling programme has an emphasis on exploration wells and is targeting a reserves replacement ratio of over 200%. This will require moving beyond the core area for the first time, in particular to drill Pola-1 in the Middle Magdalena Valley, targeting 470bcf. The planned cash and cash dividends are covered by Canacol’s existing cash and cash generation.

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2020A 246.8 172.9 86.1 2.18 68.1 1.8
2021A 250.5 162.2 87.7 24.59 6.0 2.1
2022E 272.5 204.6 90.4 28.57 5.2 1.5
2023E 309.7 241.1 117.6 33.42 4.4 1.4
Industry outlook

The Colombian, Caribbean Coast gas market is expected to move into gas deficit in the absence of LNG imports, incremental piped gas or the development of recent deepwater discoveries. Canacol sells gas under long-term, fixed-price gas contracts, typically of five to 10 years’ duration with inflation clauses to protect cash flows.

Last updated on 30/11/2022
Content on Canacol Energy
Canacol Energy – Q2 results deliver strong operating cash flow
Oil & gas | research Update | 6 September 2022
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Canacol Energy – Shift towards high-impact drilling
Oil & gas | research Outlook | 25 May 2022
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Canacol Energy – Canacol maintains drilling pace into 2022
Oil & gas | research Update | 17 January 2022
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Share price graph
Balance sheet
Forecast net debt (US$m) 450.3
Forecast gearing ratio (%) 230
Price performance
%
1m
3m
12m
Actual (0.5) (20.3) (36.3)
Relative* (5.5) (24.7) (35.7)
52-week high/low C$3.5/C$1.9
*% relative to local index
Key management
Charle Gamba CEO
Jason Bednar CFO