DNR is breaking above important moving averages. This stock has done just "OK" for us, but my Fair Value Estimate is firmly over $30/share.
It is heavily weighted to oil and quickly moving to a point where it will be generating a ton of free cash flow.
IMO this is a prime takeover target for a major that want their expertise in EOR using CO's floods.
DNR Breakout
DNR Breakout
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: DNR Breakout
DNR traded over 10 million shares today. The Big Money has finally figured out DNR.
One of the things investors often miss about DNR is the value of their CO2 reserves. I think they have 18 TCF of CO2. IMO it is worth at least $0.50/mcf. The discounted value may be worth more than half of DNR's market cap.
When I was at Hess we had our own CO2 reserves at Bravo Dome in northeast New Mexico that we moved to the Permian Basin by our own pipeline. The working interest owners without CO2 were being charged over $1.00/mcf for their share of the CO2 being injected at our Seminole San Andres Unit ("SSAU"), one of the most successful EOR projects ever. SSAU production went from 12,000 BOPD when I started at Hess in 1983 to over 64,000 BOPD by 1986. It stayed at that level (because of facility limitations) for almost ten years before declining.
D&M was the Hess 3rd party engineering firm that reported on proved reserves. Each year for over ten years they increased estimated recoverable reserves at SSAU. You can expect annual increases in recoverable reserves from DNR on most of the EOR projects.
One of the things investors often miss about DNR is the value of their CO2 reserves. I think they have 18 TCF of CO2. IMO it is worth at least $0.50/mcf. The discounted value may be worth more than half of DNR's market cap.
When I was at Hess we had our own CO2 reserves at Bravo Dome in northeast New Mexico that we moved to the Permian Basin by our own pipeline. The working interest owners without CO2 were being charged over $1.00/mcf for their share of the CO2 being injected at our Seminole San Andres Unit ("SSAU"), one of the most successful EOR projects ever. SSAU production went from 12,000 BOPD when I started at Hess in 1983 to over 64,000 BOPD by 1986. It stayed at that level (because of facility limitations) for almost ten years before declining.
D&M was the Hess 3rd party engineering firm that reported on proved reserves. Each year for over ten years they increased estimated recoverable reserves at SSAU. You can expect annual increases in recoverable reserves from DNR on most of the EOR projects.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: DNR Breakout
Take a look at the 5 day chart for DNR and you will see the breakout and follow through with strong volume. This is encouraging. IMO Denbury is the most undervalued Sweet 16 stock. Howard Weil's price target of $28 is reasonable.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: DNR Breakout
i would be looking for a breakout above 20 since for 2013 dnr has been in a 16-20 box. imo 5 days is too short a time span. i prefer a weekly chart for these type moves. time will tell. and to each his own.
dnr has been a mkt dog for so long, it would be nice for the market to once again recognize this outfit. the high volume is positive.
dnr has been a mkt dog for so long, it would be nice for the market to once again recognize this outfit. the high volume is positive.