Standard Lithium Demo Plant Operating Soon, First Production in 2022

Source: Peter Epstein for Streetwise Reports 01/23/2020 Peter Epstein of Epstein Research provides an update on a company with a lithium project in Arkansas. This month, Standard Lithium Ltd. (SLL:TSX.V; STLHF:OTCQX) is targeted to switch on a relatively large-scale, proof-of-concept lithium extraction Demonstration Plant in southern Arkansas. If all goes reasonably as planned, it should take just a few months to prove the company’s proposed operational flow sheet. Then, management believes a final JV agreement with Lanxess Corp. will be signed. CEO Robert Mintak commented, “We’re making chemical products, not merely extracting a raw commodity. We’re doing sophisticated chemistry to produce a chemical that goes into batteries. It’s a high-end product.” GM [recently] announced they were going to build a $2.3 billion factory in Ohio to make lithium batteries. The industry is only going in one direction. We’re at the point where we’re going to be the U.S. hub for it. It’s the next energy revolution and El Dorado [Arkansas] will play a part in it…. ….The key element is our growing partnership with German specialty chemicals giant Lanxess, a company with 73 chemical plants around the world employing tens of thousands. They have extensive and sophisticated sales networks to sell specialty chemical products. That’s a critical part of the whole story.” Significant vote of confidence in Standard Lithium’s JV project On October 30, Standard Lithium Ltd. (TSXV: SLL) (OTCQX: STLHF) obtained a C$5 million five-year loan, at just 3% interest from strategic partner Lanxess. The loan is convertible into … Continue reading

Millennial Lithium: Full Speed Ahead

Source: Peter Epstein for Streetwise Reports 01/22/2020 With initial production at its Argentina project expected in 2022, Peter Epstein of Epstein Research believes the company could be an “excellent” bet when lithium prices rebound. Earlier this month, the mining court of Salta, Argentina, granted Millennial Lithium Corp.’s (ML:TSX.V; MLNLF:OTCMKTS) Argentine subsidiary four mining licenses on its 100%-owned Pastos Grandes project in Salta province. Readers may recall that Millennial recently delivered a bank feasibility study (BFS) and expects to reach initial production in 2022 (subject to funding and permits), ramping up to nameplate capacity of 24,000 tonnes lithium carbonate equivalent (LCE)/year by mid-decade. Farhad Abasov, president & CEO, commented: “Millennial is pleased to have received four mining licenses which comprise ~97% of the property area at Pastos Grandes. Millennial expects the final license to be granted in the near future. The company continues to actively advance its three-tonne-per-month lithium carbonate plant and pilot evaporation ponds. Millennial is moving forward with financing, off-take and other key strategic initiatives with large industry players.” This news comes on the heels of the October announcement that the national mining secretary of Argentina granted a federal fiscal stability certificate (FFSC) for Pastos Grandes. The certificate outlines the tax regime, plus additional benefits bestowed on the project, and officially confirms a reduction in the corporate income tax rate from 30% to 25%. CEO Abasov commented, “The granting of the FFSC assures the tax and additional benefit terms under which we can operate a lithium carbonate production operation. … Continue reading

Renewable Energy MLP Announces Acquisition, Dividend Increase

Source: Streetwise Reports 01/16/2020 The specifics of both moves are presented in an iA Securities report. In a Jan. 13 research note, analyst Jeremy Rosenfield reported that iA Securities raised its target price on Brookfield Renewable Energy Partners L.P. (BEP.UN:TSX) to CA$47 per share from CA$44. This comes after the master limited partnership (MLP) announced two pieces of news: It intends to take over Terraform Power Inc., and it plans to increase its dividend by 5%. “The full integration of Terraform into the Brookfield fold would be accretive to our estimates and valuation,” Rosenfield noted. He outlined the acquisition. Brookfield would purchase the remaining 38% interest in Terraform Power Inc. that it does not already own, for US$1.5 billion. It would be an all share arrangement in which each acquired Terraform share would get swapped into new Brookfield shares at an exchange ratio of 0.36 Brookfield unit:1 Terraform share. “The transaction implies a value for Terraform of about US$17.31 per share (an approximately 11% premium to the January 10, 2020 closing price, prior to the announcement),” the analyst indicated. If approved, the deal would close in mid-2020 with the Brookfield share distribution occurring at that time. Rosenfield presented the implications of the deal. For one, it would result in an initial funds from operations contribution to Brookfield of about US$0.15–0.20 per unit, or a roughly 5–7% accretion, according to iA Securities estimates. Two, it would provide Brookfield with a larger footprint in the solar and wind markets in North America … Continue reading

Oil Encountered in Offshore Guyana Well Positive for Adjacent Explorer

Source: Streetwise Reports 01/03/2020 The result and what it means for a neighboring energy firm are provided in a Pareto Securities report. In a Jan. 2 research note, Pareto Securities analyst Tom Eric Kristiansen reported that an energy company with property adjacent to that of Eco Atlantic Oil & Gas Ltd. (EOG:TSX.V; ECAOF:OTCMKTS; ECO:LSE) in offshore Guyana, Tullow Oil, hit oil in an exploration well. Kristiansen relayed that Tullow’s Carapa-1 well encountered 4 meters of net pay with high-quality 27-degree API oil. That net pay interval, though smaller than anticipated, demonstrates that “the Cretaceous oil play extends into Tullow’s acreage in the region,” which includes Eco Atlantic’s adjacent Orinduik block, he explained. Eco Atlantic has not yet announced a drill program for Orinduik, a block with more than 1 billion barrels of oil equivalent of derisked potential, Kristiansen noted. However, when it does pursue drilling there, the Toronto-based oil and gas explorer will likely encompass in its campaign “one or more wells targeting this potential.” Pareto Securities has a Buy recommendation and a GBp100 per share target price on Eco Atlantic. It is currently trading at around GBp57. Sign up for our FREE newsletter at: Disclosure: 1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: … Continue reading

Ellomay Capital Shares Get a Spark from 265 MW Italian Photovoltaic Development Projects

Source: Streetwise Reports 12/26/2019 Shares of Israel-based renewable energy firm Ellomay Capital got a jolt today after the firm released details of the development plans for photovoltaic projects in Italy with aggregate capacity of 265 megawatts. Renewable energy and power generator and developer of renewable energy and power projects in Europe and Israel Ellomay Capital Ltd. (ELLO:NYSE.AMEX) yesterday announced “the execution of a Framework Agreement between its wholly-owned subsidiary, Ellomay Luxembourg Holdings S.àr.l. and an established and experienced European developer.” The company advised that “pursuant to the Framework Agreement, the Developer will provide Ellomay Luxembourg with development services with respect to photovoltaic greenfield projects in Italy in the scope of 350 MW with the aim of reaching an aggregate ‘ready to build’ authorized capacity of at least 265 MW over a 41-month period.” The firm noted that Ellomay Luxembourg also has the option to purchase approximately 37 MW that are already under development by the developer, of which 30 MW have already been approved to connect to the Italian electricity grid. Ellomay’s CEO Ran Fridrich commented, “The Framework Agreement executed by the Company is another tier in the Company’s plan to increase its portfolio of photovoltaic facilities that are based on [grid] parity. Today the Company’s projects under development are in an aggregate scope of approximately 550 MW and the Company intends to increase the scope shortly to approximately 1,000 MW that are expected to be built over the coming three years. The Company’s deep knowledge and extensive experience in … Continue reading

Analyst: Acquisition Accretive for Oklahoma Energy Company

Source: Streetwise Reports 12/24/2019 The favorable metrics of the transaction are discussed in a Raymond James report. In a Dec. 16 research report, Raymond James analyst John Freeman reported that WPX Energy Inc.’s (WPX:NYSE) stock price jumped 9% on news of its acquisition of Felix Energy and with good reason, as the transaction is accretive to the hydrocarbon explorer. As such, Raymond James increased its target price on WPX to $17 per share from $15 and reiterated its Strong Buy rating. Freeman reviewed the transaction specifics, noting that what WPX paid for Felix was below consensus’ expectation. The total consideration of $2.5 billion consisted of $900 million in cash and $1.6 billion worth of WPX shares. Through the deal, WPX gains “premier acreage,” about 1,500 undeveloped locations over 58,500 net acres in eastern, oilier Winkler, Ward and Loving counties in the Delaware Basin. “Assuming $30,000 per flowing barrel for the expected production at close [early Q2/20], the transaction price implies a per acreage valuation of about $12,000,” the analyst explained. “On a 2020 enterprise value:EBITDA basis, WPX Energy paid about 3.5x, comparing favorably with consensus pre-deal for WPX at about 5x.” While WPX will fund part of the acquisition by issuing about $900 million in senior notes, the transaction ultimately should be leverage neutral due to the expected, resulting boost in revenue. Freeman also highlighted that WPX Energy’s management and Raymond James agree that the transaction immediately increases cash flow per share (CFPS), earnings per share (EPS), free cash flow … Continue reading

Apache and Total Form $5 Billion Joint Venture to Drill off Suriname Coast

Source: Streetwise Reports 12/23/2019 Shares of Apache Corp. traded 16% higher today after the company reported that it has formed a joint venture with Total SA of France to explore and develop Block 58 offshore Suriname. Late yesterday evening, oil and gas exploration and production company Apache Corp. (APA:NYSE) and producer and marketer of fuels, natural gas and low-carbon electricity Total S.A. (TOT:NYSE), announced that they have established a 50-50 joint venture (JV) agreement to explore and develop Block 58 offshore Suriname. The firms outlined the terms of the agreement indicating that Apache and Total will each own a 50% working interest in Block 58. The report advised that this area is composed of approximately 1,400,000 acres in water depths that range from below 100 meters to over 2,100 meters. “Apache will operate the first three exploration wells in the block, including the Maka Central-1 well, and subsequently transfer operatorship to Total.” The JV agreement provides that “Apache will receive various forms of consideration, including: $5 billion of cash carry on Apache’s first $7.5 billion of appraisal and development capital; 25% cash carry on all of Apache’s appraisal and development capital beyond the first $7.5 billion; various cash payments in conjunction with closing of the joint venture agreement and future production from joint development projects; and reimbursement of 50% of all costs incurred to date in Block 58.” Both firms advised that the transaction is expected to close within three days and they have already received all of the necessary … Continue reading

Azarga Gets Thumbs Up from Analysts After Favorable Ruling on NRC License

Source: Streetwise Reports 12/23/2019 After receiving a favorable ruling on the NRC license, its focus shifts to project economics. Azarga Uranium Corp. (AZZ:TSX; AZZUF:OTCQB; P8AA:FSE) recently announced that the Atomic Safety and Licensing Board (ASLB) issued its Final Initial Decision, resolving the final remaining contention for the Nuclear Regulatory Commission (NRC) license for the Dewey Burdock In-Situ Recovery Uranium Project in South Dakota in favor of the company. This decision was lauded by industry analysts. Haywood analyst Colin Healey wrote on December 13, “The positive decision from the ASLB is a huge boost for Azarga and significantly de-risks the Dewey Burdock Project, opening the way for aggressive advancement including pursuing other required permits for future construction and production. . .With a Final Decision rendered, the outlook significantly improves as Azarga can push forward with additional permitting at Dewey Burdock unencumbered.” Haywood has a Buy rating and a target price of CA$0.50 for Azarga. The stock is currently trading at around CA$0.21. Eight Capital analyst David A. Talbot wrote on December 13, “In a positive move, the Atomic Safety and Licensing Board issued its final decision, resolving the final contention against 100%-owned Dewey Burdock (DB) project’s NRC License in favour of Azarga and NRC staff. This means its NRC Source & Byproduct Materials License is in good standing, free and clear of any further contentions.” Eight Capital is maintaining its Buy recommendation for Azarga and a 12-month target price of CA$0.45. Gerardo Del Real wrote in Junior Mining Trader on December … Continue reading

Tallgrass Energy Shares Rise 20% on Blackstone Partners Acquisition Deal

Source: Streetwise Reports 12/17/2019 Shares of Tallgrass Energy LP traded 20% higher after the firm advised that it entered into a definitive merger agreement with Blackstone Infrastructure Partners to acquire all of the company’s publicly held outstanding class A shares for $22.45 per share in cash. Midstream energy infrastructure company Tallgrass Energy LP (TGE:NYSE) today announced that it has entered into a definitive merger agreement with Blackstone Infrastructure Partners (BIP) and its investment partners Enagas, GIC, NPS and USS to acquire all of the publicly held outstanding Class A Shares of TGE for $22.45 in cash per share. Tallgrass Energy stated that its Board of Directors’ Conflicts Committee has already unanimously approved the transaction and determined it to be in the best interests of the company and its public shareholders. The report indicated that the transaction is expected to close in Q2/20 subject to satisfaction of customary conditions, including approval of the merger by holders of a majority of the outstanding Tallgrass Class A and Class B shares. This majority is inclusive of the approximately 44% of the total Class A and Class B shares that are already held by the BIP consortium sponsors. The BIP sponsors stated that they expect to fund the bulk of the purchase of the Class A Shares with approximately $3 billion of equity with the remainder of the transaction funding to be financed by debt. Tallgrass Energy LP is a growth-oriented midstream energy infrastructure company headquartered in Leawood, Kansas. The firm indicated that “it … Continue reading

STACK Agreement 'Positive' for Area Operator

Source: Streetwise Reports 12/12/2019 The deal details are relayed in a ROTH Capital Partners report. In a Dec. 10 research note, ROTH Capital Partners analyst John White purported that a recent development in the industry is positive for Chaparral Energy Inc. (CHAP:NYSE) as its primary areas of operation are the STACK and MERGE plays in Oklahoma. The development is an agreement between Devon Energy and Dow to co-develop part of Devon’s STACK acreage, with Dow committing about $100 million to drilling over the next four years. The two companies will start year by developing two drill units in Canadian County, where Chaparral “has 23,000 net acres with an average 66% interest” and “98% held by production,” White explained. ROTH has a Buy rating and a $9 target price on Chaparral. The company currently trading at around $0.93 per share. Sign up for our FREE newsletter at: Disclosure: 1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. 3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for … Continue reading