This article was originally
published by Seeking
Alpha on March 25, 2014
By Sarfaraz A. Khan. Research assistant: Gohar Yousuf
By Sarfaraz A. Khan. Research assistant: Gohar Yousuf
Summary
·
BPZ Resources has
developed only a fraction of its properties.
·
The company has a
disappointing track record but is eyeing a turnaround on the back of higher
production.
·
The company has
already given the first solid evidence of a turnaround, is nearing
profitability by Q1-2015.
BPZ
Resources (BPZ) is an energy company
that is engaged in oil and natural gas exploration and production in Peru,
which the company believes, offers excellent opportunity for long term growth.
So far, only a
fraction of its properties, just 0.04% of the total gross acreage, has been
developed. Therefore, the company has significant room for growth in terms of
net proved reserves, production, revenues and income.
Although the company's
performance over the past few years has not been satisfactory, it appears on
the verge of a turnaround. The markets have realized this and BPZ's shares have
been up 65% this year. However, I believe that there is still room for a
potential 40% upside for long term investors. For this, we'll have to dig a
little deeper.
Indications
of a turnaround
First, a little bit
about the company. BPZ Resources was formed in 2001 but its predecessor, BPZ
& Associates, has more than a decade of experience of working as an energy
consultant, particularly in Peru. BPZ Resources currently has 16.1 million
barrels of net proved oil reserves, all of which lie in the Corvina and
Albacora fields in Peru's Block Z-1.
Although BPZ has
attractive growth prospects, its past … read full
article at Seeking
Alpha
