Paramount Resources (POU.TO)

An upstream oil and gas company. It is one of the best companies in the area. They are now going through the development phase. They will build very large natural gas processing plants. Growth rates are remarkable. In the next several years we will see this company grow at a very good rate.

This company strength is the Riddell family. You have a very capable, deep-pocketed management team. We are going through a trough of energy/crude prices, and this will help ride through the storm. A focused strategy is also what they bring to the table. These attributes mean that you can be a Buyer rather than being acquired.

(Top Pick May 16/14, Down 45.14%) Solid management team, good assets and a potential to grow production. They should double production between 2015 to 2016.

There is a ton of growth coming, some of it has come already, but it is just on the cusp of BOE’s a day 30,000 months ago, 40,000 now and heading for 70,000 by year-end. This is gassy (wet gas). Balance sheet looks stretched, which is why it got hit, however they are spending for growth and the cash flow is just coming now. Looking out 12 months, the balance sheet looks much better and he thinks the stock will be higher. He buys it when it dips to $30-$31.

Tourmaline (TOU-T) or Paramount Resources (POU-T)? He would buy financials before he bought energy.

They spent a lot of money getting a gas plant going. That is built into the price. We are just starting into a bullish time for Natural gas (Mar 22). We are just below level before the run up from last year. When it gets above $40 it will be breaking out. Rigs Nat Gas are coming off line, like oil, so this is positive. He doesn’t see huge returns on this one, however.

Is going through a transformational 24 months with a massive Alberta project. If they meet their targets, the price to cash flow production looks reasonable. He likes it, but you need higher condensate prices.

If gas prices go up, this could do extraordinarily well. They have ploughed a huge amount of money into their own processing and infrastructure. He is not in this now because there is a huge amount of natural gas drilling going on, because of the potential for LNG exports. Before you get an export license, you have to prove that you have the gas. Once you have the gas, and if the LNG port is not ready to go, you are going to dump some of that gas into the market. This puts a bit of a ceiling on the natural gas price, which could be an issue for this company. If we get a really cold winter, this company could do very well, but if it warms up this company might not do that well.

(A Top Pick Jan 16/14. Down 47.01%.) Sold off with the oil market. The story is still intact. At the inflection point of its evolution and growth as a company, where it’s in the process of completing in 2014-early 2015, some surface treatment facilities that dramatically increases production. It will go from 25,000 barrels a day to about 60,000 barrels a day.

(A Top Pick Dec 16/13. Down 7.62%.) Although it is gas and it has huge growth, it pre-funded the growth with a leveraged balance sheet, so it has acted relatively poorly in the last month, more so than what he would have thought. It is only going to take about 6 months for a ton of cash flow to come in, because they are already up and producing. When that happens and the debt gets paid back, it is going to look fine. He would Buy it for new clients today.

Ultra liquids rich Nat. Gas company. 6 times debt to cash flow. It is not a glorious position to be in. They have a really good asset base, however.

This is the name that just suffers from any obvious catalyst. Thinks it will go sideways. A decent name.

Stock started to fall well before the price of oil did. Energy is a tough neighbourhood to be in.

Natural gas. Management doesn't pay themselves a salary. Well-run. Going from 20,000 BOE’s a day to 70,000 because of their new plant online. Thinks they are going to be at 125,000 by 2017 because they just raised $350 million, of which $150 million is going towards 2 new plants. Has tremendous growth ahead of itself. Look at this as a 2016-2017 growth story.

(Top Pick Sep 11/13, Up 85.28%) Big production growth that he thought was so certain. They had to build production facilities.