Close menu




June 9th, 2022 | 11:19 CEST

Shares of Nel ASA, BP, BASF and Saturn Oil + Gas: Goldman bullish on oil price

  • Oil
  • greenhydrogen
  • chemicals
  • Mining
Photo credits: pixabay.com

Good news for oil producers such as BP, ExxonMobil and Saturn Oil & Gas: Goldman Sachs has raised its oil price forecasts and expects prices to remain high. The price target for Brent crude was raised from USD 125 to USD 140 per barrel. The reasons given for this are unresolved structural bottlenecks. The oil giant ExxonMobil shot up to a new all-time high in the wake of the news. For Saturn Oil & Gas, a takeover has come at the right time. The Canadian producer wants to double its production again. Nel is also likely to benefit, as the high prices for fossil energies are making it easier to switch to renewables. For BASF, however, the Goldman forecast is bad news, but analysts see considerable upside potential.

time to read: 3 minutes | Author: Fabian Lorenz
ISIN: NEL ASA NK-_20 | NO0010081235 , BP PLC DL-_25 | GB0007980591 , BASF SE NA O.N. | DE000BASF111 , Saturn Oil + Gas Inc. | CA80412L8832

Table of contents:


    Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG
    "[...] China's dominance is one of the reasons why we are so heavily involved in the tungsten market. Here, around 85% of production is in Chinese hands. [...]" Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG

    Full interview

     

    Saturn Oil & Gas: Entering new league with takeover

    Saturn Oil & Gas has made another big splash. The Canadian company plans to increase its production by a further 50% through a takeover, which would put it in the league of the leading listed light oil producers. In addition, significant synergy effects are expected. Specifically, the Company wants to take over an oil production facility in the Viking area in west-central Saskatchewan with a production volume of approx. 4,000 barrels per day (boe/d of which approx. 98% is light oil and liquids) for approx. CAD 260 million. That is coupled with a high net cash flow and 140 new properties. Financing was secured within a few days. The area is one of the most attractive light oil resource areas in North America. Saturn is already active in Southeast Saskatchewan and can leverage synergies accordingly.

    A report at researchanalyst.com sees the transaction positively. The acquisition will increase Saturn's daily production capacity at full load by more than 50% to approximately 11,400 boe/d. On the cost side, royalties are expected to drop from about 15% to 12% and operating expenses per boe are estimated to decrease by 16%. In addition, further cost savings are expected in the areas of transportation, labor and processing costs. "The growth strategy makes sense, especially from this point of view," researchanalyst.com said. Saturn expects to maintain Viking's production at a level of about 4,500 boe/d with 35 to 40 wells per year, which would include a free cash flow of more than CAD 85 million per year with upside potential. Once the transaction is completed, analysts will also have to adjust their studies. Meanwhile, the stock is covered by four research houses and recommended as a buy by all of them. GBC Research's target price for Saturn shares before the takeover was CAD 13.12, or EUR 9.75 - PDF, study. The share is currently trading at EUR 2.

    Nel: When will the big order come?

    The renewable energies sector also benefits from rising prices for fossil energies. On the one hand, the generally higher production costs become competitive more quickly. On the other hand, the pressure on governments to consistently fossilize the energy turnaround increases. Nel ASA is one of the profiteers. And the share of the Norwegian hydrogen specialist can currently use all the support it can get. After plummeting to EUR 1.15 in May, the share is not getting off the ground and is currently trading at EUR 1.40. The share price exceeded this level at the beginning of 2021 when it was over EUR 3. Even the latest order has not helped the share to break out. The Norwegian metal refiner Glencore Nikkelverk has ordered an electrolyzer for green hydrogen from Nel. The alkaline electrolyzer system is to be built in the middle of next year to supply green hydrogen for the production of hydrochloric acid in the future. The order volume is EUR 3 million. Investors are thus still waiting for a major order.

    BASF: Can raw material and energy prices be passed on?

    BASF will certainly not be jubilant about Goldman Sachs' oil price forecast. The business is too energy-intensive for that. As a reminder, BASF was mentioned as the big loser in the discussion about a gas embargo against Russia. The chemical group would have to shut down at least parts of its German production. Doing so would have a significant impact on the entire German economy. This horror scenario does not stop Bernstein Research from recommending BASF shares as a buy. On Monday, the price target was even raised slightly from EUR 87 to EUR 88. The analysts are confident that BASF will be able to pass on the rapidly rising raw material and energy prices to customers in 2022. Therefore, the Ludwigshafen-based group is Bernstein's favorite among industrial chemical groups, alongside Akzo Nobel. BASF shares are currently trading just below EUR 53.


    Energy prices are keeping companies and capital markets on their toes. Oil producers such as Saturn Oil & Gas and Exxon are currently earning a pretty penny. If BASF can pass on the high purchase prices, the share is not expensive. Nel must finally announce a major order.


    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") currently hold or hold shares or other financial instruments of the aforementioned companies and speculate on their price developments. In this respect, they intend to sell or acquire shares or other financial instruments of the companies (hereinafter each referred to as a "Transaction"). Transactions may thereby influence the respective price of the shares or other financial instruments of the Company.
    In this respect, there is a concrete conflict of interest in the reporting on the companies.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.
    For this reason, there is also a concrete conflict of interest.
    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on news.financial. These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.

    The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.


    Der Autor

    Fabian Lorenz

    For more than twenty years, the Cologne native has been intensively involved with the stock market, both professionally and privately. He is particularly passionate about national and international small and micro caps.

    About the author



    Related comments:

    Commented by Armin Schulz on December 7th, 2022 | 09:50 CET

    TotalEnergies, Saturn Oil + Gas, Shell - Energy shares as a booster for the portfolio

    • Mining
    • Oil
    • Gas
    • renewableenergies

    Now it is here, the oil embargo against Russia. The oil price was volatile before, and now with the new sanctions, it could get even more chaotic. The International Energy Agency fears that Russia could significantly reduce its oil production. That would cause the supply on the market to drop sharply and the oil price to rise. If there is a global recession, this will reduce demand, but due to the steadily increasing population, the need for oil continues to grow. As of November, there are 8 billion people living on our planet. The supply of oil will remain important in the coming years. We, therefore, take a look at three companies in the sector.

    Read

    Commented by Stefan Feulner on December 7th, 2022 | 09:48 CET

    Nordex, Kodiak Copper, Geely - Exploding demand, rising prices

    • Mining
    • Copper
    • Electromobility

    In the coming decades, the electrification of transport is expected to continue to grow strongly, with battery-powered electric cars replacing internal combustion engines. In addition, the shift from fossil fuels to renewable energy sources such as wind and solar power will be greatly accelerated, both to reduce dependencies and to meet established climate targets. This transformation is expected to explode the demand for critical raw materials for climate change. Copper, in particular, plays a vital role in this.

    Read

    Commented by André Will-Laudien on December 5th, 2022 | 11:03 CET

    Debacle for e-mobility? BYD, Varta, Almonty Industries, Nordex - Farewell from the Qatar desert!

    • Mining
    • Tungsten
    • RareEarths
    • renewableenergies
    • Electromobility

    The German national soccer team has experienced its next World Cup debacle and attracted even fewer interested people to their TV sets than during the first World Cup elimination 4 years ago. Even during the third-round preliminary match, TV figures remained comparatively low. The DFB women thus retain the viewer record in 2023, which is nice. E-mobility could also suffer a significant setback in 2023 because if electricity prices continue to rise and availability falls, charging stations could have to be taken off the grid. According to the ADAC, Switzerland is planning a speed limit of 100 and driving bans on non-essential private trips with e-mobiles to prevent the risk of blackouts. The decision will be made in the National Council on December 12. But the stock market is still betting on Tesla & Co - who are the profiteers?

    Read