Maintenance was scheduled for Mar/Apr24.KAR produced 29kbpd...

Maintenance was scheduled for Mar/Apr24.

KAR produced 29kbpd during the TY23, six month period.

KAR is now producing only 25kbpd from Brazil for Q1Y24. At least when the hydrated Well is fixed in Q3, that will compensate for the 15% natural decline for the following year.

KAR also producing 30% of the Who Dat production of 38.5kbpd, being ~11kbpd.

So, KAR is producing at 36kbpd now. With the Oil price at $84/88 that should equate to revenue of ~US$1.14b for FY24. That would represent a 38% increase on TY23.




If NPAT increases similarly, then that would be US$400m. At 65c, that would be A$615m and represent a P/E of 2.85 at our current SP.


Petrobras has a lousy P/E of 4 too, however it also has debt/MC of 50% and pays a 14% dividend yield.

Chevron is 14 and 4%
Exxon is 13 and 3.25%
Shell is 12 and 4.7%
BP is 7 and 4.5%


I estimate KAR will have net debt of zero by the end of May24. The BOD have stated they intend to maintain debt for at least 2 years and max it out for the extra US$64m sometime.

It was noticeable in the last conference call that they mentioned the preference for more M&A rather than returns to shareholders. I can understand any potential equity investor being apprehensive given this.


However this is an Oil play and extremely sensitive to movements in the Oil price. The KAR SP rose to $2.74 last year when the Oil price was increasing. Many analysts were suggesting then that the Oil price would rise to $100 in 2023.

The black swan was US Oil production rising to 13.3mbpd. The polar vortex inhibited some production in early 2024 but has bounced back to 13.1mbpd. With Alaska off limits, the US Major Oilers have been battling for lower tier resources.

The US still battles the red queen syndrome.





Last year, the KAR SP rose gradually as potential investors waited to see the oil price play out. Here we are again.

The USA, the West, the WEF might control the debt markets but the BRICS+ control the commodity markets. The West weaponised the US$, can we now expect the BRICS to weaponise the commodity markets to attack the US$?


Given last years SP/Oil Price trend, revisiting $2.72 looks a formality. I want $4 minimum.