It’s been a tumultuous year for energy investors, with oil whipsawing wildly since January, climbing to a multiyear high only to collapse once again to see West Texas Intermediate (WTI) down by 11% and Brent 7% for the year to date. The latest price collapse is weighing heavily on oil stocks, with many being heavily marked down by the market. Among them is Gran Tierra Energy Inc. (TSX:GTE) (NYSEMKT:GTE), which has fallen by 4% since the start of 2018, thereby creating an opportunity for investors to acquire a high-quality driller with considerable potential upside. Now what? Gran Tierra is focused on the exploration and production of oil in the Latin American nation of Colombia, where it has oil reserves of 137 million barrels composed entirely of higher margin light and medium crude. Those reserves have a net present value before taxes of US$2.5 billion, or over $1 million greater than the driller’s enterprise value. That is equivalent to around $8.62 per share, more than double Gran Tierra’s market price, indicating the considerable potential upside available once oil recovers. There is every likelihood that crude will firm in coming months. OPEC and Russia have indicated that they are willing to […]
