April 5th, 2010 
Category: 
MEL is a junior oil and gas company engaged in the exploration for, and development and production of, oil and natural gas in Western Canada, primarily in the provinces of Alberta and British Columbia.
Quick Facts (Q3 2010):
Average Production: 2,209 boe/d, 55% oil + ngl
O/S: 75.25 MM FD
Land: 116k net undeveloped
Q3 Highlights
Q3 average production: +15% Q-Q.
2010 production guidance: 3,000 boe/d exit rate with 65% oil+ngl weighting, September exit production was 2,600 boe/d.
Outlook (November 16, 2010)
By having the majority of its production coming out of the Garrington area, Midway has been able to reduce its operating costs every quarter. They have succeeded in lowering their natural gas weighting and seem to be on track for hitting a 65%+ oil weighting by the end of the year.
Here’s a quick summary:
- MEL currently holds at least 40 sections of Cardium prospective land (Garrington area) which makes them a prime takeover target if consolidation continues in that area.
- Established current inventory of over 150 net Cardium drilling locations.
- Entered into a rolling option farm-in agreement on 10 net sections of Cardium rights immediately offsetting Midway’s lands (adds 40 drilling locations).
- Established a foothold in the Swan Hills emerging tight oil play. MEL has access to 9 net sections of land with 28 potential drilling locations. 1st well licensed in November.
In Summary, Oil is the name of the game and Alberta’s Cardium formation is the industry’s hot spot. With prices hovering above 80$ per barrel, I think the fundamentals are there for a good return on investment! As MEL executes, I expect the share price to reflect their success.
Disclaimer:
I was not paid any fees to feature this stock. I am just sharing my research. Please do your own due diligence before buying or selling any security.
My DIY stock portfolio is overweight in Canadian oil producers for a reason. I believe Oil consumption is on the path of growth for the next decade and I intend to take every advantage possible of it:
[...] I bought 800 shares of TSE:MEL Midway Energy at [...]
[...] Midway Energy’s loss was primarily due to stock based compensation that was approved during this period. Even though the share price closed at 3.19, I would not be surprised to see it dip lower in the coming days. For now, unless a profit taking opportunity appears, I will be keeping these shares since the company is very active in the Cardium and targeting a 50% increase in its daily production by year’s end. I bought MEL as a catalyst trade based on the upcoming Q2 results which did not materialize well due to the reported loss. I always take into account what I perceive as solid fundamentals to hold this stock in the event that this situation happens. Just like my other holdings, I am often in contact by phone or email periodically to keep a close eye on what is going on in the company, after all I am investing and not gambling. [...]
[...] I sold my last 1000 shares of Midway Energy (TSE:MEL) at $3.39 from my [...]
[...] TSE:MEL [...]