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Canaccord Genuity upgrades Hurricane Energy to 'buy'
23rd Sep 2019 11:04
(Sharecast News) - Analysts at Canaccord Genuity raised Hurricane Energy to 'buy' from 'speculative buy' on Monday, highlighting some "fresh operational information" on its Lancaster early production system project in the group's interim results.
Canaccord, which kept it 95p target price for Hurricane unchanged, said that while it was still "early days", reservoir oil deliverability remained "strong" at Lancaster and noted that the facilities appeared to be bedding in successfully.
With early issues having been resolved, the Canadian broker interpreted the latest key information from Hurricane on water production as being "reassuring".
"The Lancaster EPS has been onstream for only three months or so, and unsurprisingly it has not all been straightforward operationally," said Canaccord.
"Yet underlying that, the company's confidence in the Lancaster EPS is strengthening and we think that is increasingly justified in terms of both the subsurface and facilities."
Canaccord noted that there was still "plenty of data to be gathered to embed the sense of reducing risk", with another update expected before the end of the year and a capital markets day in the first quarter of 2020.
The analysts also argued that Hurricane's current market capitalisation discounted little more than a risked view of the planned expansion at Lancaster and largely ignored the undeveloped resource potential.
As of 1300 BST, Hurricane shares had crept forward 0.17% to 46.48p.
Canaccord, which kept it 95p target price for Hurricane unchanged, said that while it was still "early days", reservoir oil deliverability remained "strong" at Lancaster and noted that the facilities appeared to be bedding in successfully.
With early issues having been resolved, the Canadian broker interpreted the latest key information from Hurricane on water production as being "reassuring".
"The Lancaster EPS has been onstream for only three months or so, and unsurprisingly it has not all been straightforward operationally," said Canaccord.
"Yet underlying that, the company's confidence in the Lancaster EPS is strengthening and we think that is increasingly justified in terms of both the subsurface and facilities."
Canaccord noted that there was still "plenty of data to be gathered to embed the sense of reducing risk", with another update expected before the end of the year and a capital markets day in the first quarter of 2020.
The analysts also argued that Hurricane's current market capitalisation discounted little more than a risked view of the planned expansion at Lancaster and largely ignored the undeveloped resource potential.
As of 1300 BST, Hurricane shares had crept forward 0.17% to 46.48p.