Alberta Oil - - JUNIORS -

In this busi­ness, tim­ing is every­thing. In July 2014, Painted Pony’s tim­ing couldn’t have been bet­ter as it un­loaded all of its re­main­ing oil as­sets for $100 mil­lion right at the peak of the mar­ket. That cash gave Painted Pony a com­pletely clean bal­ance sheet with which to nav­i­gate the past cou­ple of tough years.

Painted Pony is an­other young en­tre­pre­neur­ial com­pany that has done some eye-pop­ping things in a very short pe­riod. From 2008 through 2017, Painted Pony is ex­pected to grow pro­duc­tion by 5,945 per­cent. That’s quite a con­trast from oil and gas ma­jors that have strug­gled to grow pro­duc­tion at all.

Like oth­ers on this list, it is the Mont­ney nat­u­ral gas that is driv­ing Painted Pony. It has as­sem­bled a mas­sive piece of prime real es­tate in the north­east B.C. Mont­ney. We are talk­ing about 217 net sec­tions of land—139,049 net acres—sur­rounded by log­i­cal Painted Pony suit­ors and LNG play­ers Petronas and Shell.

Hav­ing the fore­sight to lock down this ter­rific acreage was part one of this suc­cess story. Step two is be­com­ing very, very good at get­ting hy­dro­car­bons out of the stacked for­ma­tions that are found on the prop­erty. As re­cently as 2014, Painted Pony was see­ing ini­tial pro­duc­tion in the first 30 days of 5.5 Mcf/d, and exit pro­duc­tion rates af­ter one year for these wells have been com­ing in at 2.6 Mcf/d. The most re­cent gen­er­a­tion of wells have seen those num­bers in­crease to 9 Mcf/d and 6 Mcf/d, re­spec­tively.

At re­cent strip pric­ing, Painted Pony be­lieves it can gen­er­ate IRRs of 136 per­cent. Even­tu­ally, Painted Pony’s as­sets are go­ing to make the com­pany an ac­qui­si­tion tar­get for one of the world’s largest oil and gas com­pa­nies. One can only imag­ine, given its his­tor­i­cal rate of growth, how much Painted Pony might be pro­duc­ing by the time that hap­pens.


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