TD Securities released a research note today on the Talisman/Sasol deal. They stated that "Farrell Creek is considered largely de-risked." Since TLM's land is adjacent to Canadian Spirit Resources Inc.'s (SPI) land, one can project that at least a portion, if not most of SPI's upper Montney land could be considered de-risked. Should one consider SPI's Farrell Creek land to be similar to TLM's Farrell Creek land, similar valuation metrics place a value of $7.67/share for SPI. Even at a 50% discount, SPI has significant upside potential!
Of additional interest is Sasol's GTL (methane to liquid products) technology. They currently run the largest GTL plant in the world and this could be a viable alternative for North American natural gas.
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