Hemisphere: Questions for Don Simmons on Feb 11

[dan_s]

Hemisphere Energy is hosting our webinar at 11AM CT on Friday, Feb 11.

If you have questions that you want me to ask Don, please type them here.

[sl6886]

Hello Don/Dan:

1. 1/18/22 Guidance had 2,400 bpd average, without (4) additional wells not on-line. 2/8 Guidance refers to be "pleased with early results" of the 4 wells. Last year, not willing to put a number on each well, but I think they came in at 80+ bpd. If most or all of the 1/23 to 2/5 increased production announcement of 2,635 bpd was associated with the polymer flood, and the four wells average 80, then 320 + 2,635 = 2,955 area? And, when should the improvement from the G Pool Polymer Flood top out in terms of timeframe?

2. Since there's Corporate Guidance on a specific debt repayment goal, specific capital budget objectives, and specific dollar amounts for the Share Buy Back NCIB Plan, is it reasonable to expect more concrete discussions on the dividend plan once the debt is paid in full in the 3rd/4th quarter?

3. For other capital/growth plans, what types of opportunities is Don seeing in the marketplace and what are the criteria being used for evaluating these opportunities.

Thanks
Scott

[CreativeEquity]

In 2022 will free cash flow be used to issue dividends and share buy backs ? Or will it all go towards organic growth and acquisitions ?

thank you for setting this up Dan !

[dan_s]

I will ask the questions to Don, but based on previous discussions with him: He will pay off a lot of debt, but maybe not all of it because he wants to keep the credit facility in place. FCF will easily fund this year's drilling program and fund:
> Stock buybacks
> Acquisitions
> Dividends are all possible in 2H 2022.

If WTI averages $85/bbl in 2022, Hemisphere should generate over $41 million of operating cash flow. That should fund their $9 million capital program, could pay off all the company's debt and make a few acquisitions.
At an $80Cdn/bbl realized oil price in 2023, Hemisphere should generate $55Cdn to $60Cdn million operating cash flow next year.

[dan_s]

Thanks to all of your that were on the live webinar. I will be making some adjustments to my forecast/valuation model for Hemisphere and posting it to the EPG website this afternoon.

If you have any move questions, just post them here and I will get back to you or send them to Don.

[Fraser921]

Great webinar I want to listen again when you put out the replay. Lots of good info.

Pleasantly surprised to hear they are only 26% hedged with collars up to 100

[timweber]

Stock is soaring today. EPG community must be buying it up. I need to add to my position.

[dan_s]

Link to the webinar replay will be sent to all EPG members via email. It should draw more attention to the stock on Monday. My advice is to get in before the updated reserve report comes out. It should show PV10 net asset value of at least $3.00Cdn per share.

The slides that Don spoke from are on the Hemisphere website.