Kolibri Global Energy Maps Oklahoma Shale Growth, Buybacks and Takeover Potential

Kolibri Global Energy Maps Oklahoma Shale Growth, Buybacks and Takeover Potential

Key Points

Kolibri Global Energy outlined a growth plan centered on Oklahoma’s Tishomingo Field, with 2024 guidance for about 5,000 boe/d , adjusted EBITDA of $56 million to $62 million , and capital spending of $39 million to $43 million .

The company said it has significant upside from its reserve base and new drilling targets, including about 40 million proved barrels and 57 million proved plus probable barrels , while testing the unproven False Caney interval could add more locations beyond current reserves.

Management highlighted strong economics and shareholder returns, citing low operating costs of about $7.50 per boe , expected free cash flow of roughly $20 million-plus , ongoing share buybacks, and the possibility of future dividends or a takeover.

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Kolibri Global Energy NASDAQ: KGEI executives outlined the company’s Oklahoma-focused shale oil strategy, drilling plans and capital allocation priorities during a recent investor presentation, emphasizing production growth, low operating costs and potential reserve additions from new intervals in the Tishomingo Field.

President, CEO and Director Wolf Regener said Kolibri operates in Oklahoma’s Tishomingo Field and is focused on developing shale oil assets while maintaining what he described as a prudent balance sheet.

The company also trades on the TSX under the symbol KEI.

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Regener said Kolibri has a $75 million line of credit with Bank of Oklahoma and had about $45 million in debt at the end of the most recent quarter.

He said the company has been paying down debt after bringing several wells online late last year, which contributed to production growth in the first part of the year.

Guidance and Reserve Base

Kolibri’s current-year guidance calls for a midpoint of about 5,000 barrels of oil equivalent per day, which Regener said represents a 17% to 30% growth rate.

The company is forecasting adjusted EBITDA of $56 million to $62 million and capital expenditures of $39 million to $43 million, based on a $70 oil price assumption.

Regener said the company’s reserve report, prepared by Netherland, Sewell & Associates, estimates about 40 million barrels of proved reserves and roughly 57 million barrels of proved plus probable reserves.

He said only about 29% of proved reserves are in the proved developed producing category, with the remaining 71% in proved undeveloped reserves.

“We have a lot of running room to drill more wells,” Regener said.

He also said Kolibri’s proved reserves were valued at more than $400 million in the reserve report, while proved plus probable reserves were valued at just under $700 million, compared with a market capitalization he estimated at roughly $190 million at the time of the presentation.

Drilling Program and New Intervals

Kolibri is currently drilling three Clifton Mack wells in the southwest corner of its field, Regener said.

After those wells, the rig is expected to move to test the False Caney, a new bench that is not included in the company’s current reserve report.

Regener said all of Kolibri’s current reserves are attributed to the Caney formation across about 11,500 net acres.

The False Caney has not yet been tested by Kolibri, but the company has identified just under 10,000 acres where it believes the interval could be prospective.

He said Kolibri has core samples showing “good oil saturations” and well logs indicating the False Caney “looks very good.”

Regener described the test as a potential catalyst because it could add drilling locations beyond those already included in the reserve report.

The company also has potential in the T-zone, which Regener said has been tested in a couple of wells.

Those wells were “good wells,” he said, but earlier complet...