TGL: Production Is Multiplying

WARREN VERBONAC, Union Securities Ltd. (07/19/2010)
"TransGlobe's rapidly growing Egyptian production has overtaken volumes from their long-established Yemeni interests.
  • Initial successes at fracturing vertical wellbores in the Arta field in Egypt, have resulted in ten-fold production increases.
  • TransGlobe's consistent growth for most of the last decade is expected to be maintained with the drilling of as many as 37 locations in 2010. Fracture stimulation of these locations could accelerate production growth.
  • The Company is bidding on additional acreage in Egypt. Its rapid rise as a major producer in Egypt bodes well for obtaining additional concessions.
TransGlobe occupies a unique position in the junior oil and gas sector for two reasons. The stock has traditionally traded at premium multiples due to its long history of constant production growth which should reach 15% this year. Secondly, the indications of accelerated growth from success of the fractured wells at Arta will likely keep the stock at premium levels. We are initiating coverage of TransGlobe Energy with a Buy recommendation and a target price of $9.00."

 PRINT THIS PAGE   EMAIL THIS PAGE

Under SEC rules, analysts are required to disclose their interest in securities that they cover. We strongly encourage you to contact them to understand any potential conflicts of interest they may have.

Related Quotes: