Oil remains flat after OPEC announced a last-minute deal with its allies to cut production by 1.2 million barrels daily. The North American benchmark West Texas Intermediate (WTI) is trading at just over US$50 a barrel, while the international price Brent is trading at around US$60 per barrel. This, along with weaker fundamentals for crude, shouldn’t deter investors from the energy patch because it has created an opportunity for contrarian investors. A driller that stands out is intermediate oil and natural gas producer Bonavista Energy Corp. (TSX:BNP) . The company has lost over 41% for the year to date, almost four-times the 11% decline in the value of WTI, thereby highlighting the opportunity that decrease has created. Now what? Bonavista is focused on producing natural gas in Alberta’s Deep Basin and West Central plays, where it has reserves totalling 438 million barrels of oil equivalent, which are 71% weighted to natural gas. This, along with 70% of its production composed of natural gas, makes Bonavista an ideal play on higher natural gas prices, which have surged by 60% over the last three months because of unseasonably cold weather and a resultant sharp spike in demand for the fossil fuel […]
