This may explain the upwards movement.US sale bodes well for...

This may explain the upwards movement.

US sale bodes well for Sundance

Edited by Sarah Thompson and Anthony Macdonald

Locally listed Sundance Energy Australia’s acreage in the Bakken oil shale in the United States could soon be viewed as more valuable.

US oil industry sources say Tudor Pickering Holt, an investment bank known for unconventional oil and gas deals, is marketing assets in the area owned by private group Helis Oil and Gas.

Word is Helis’s 12,500 net acres (32,000 gross operated) in the Williston basin area of North Dakota could attract a bid north of $US650 million of cash.

Sundance owns 4000 net acres that are operated by Helis in the region. Therefore, if Helis achieves the mooted price for its own acreage, Sundance’s ground would have a see-through valuation of about $200-$250 million. That compares to Sundance’s market value of $161 million.

Notably, the company has 45,000 total net acres across its portfolio, although it has been pumping most capital into Williston to meet its goal of boosting production to 5000 barrels of oil equivalent per day within two years, up from 1656 (boe) per day in April.

Bell Potter has been the chief Sundance supporter in Australia and has a “buy” rating with a $1.09 price target, compared to Tuesday’s closing price of 58¢.Bell Potter has been the chief Sundance supporter in Australia and has a “buy” rating with a $1.09 price target, compared to Tuesday’s yesterday’s closing price of 58¢.

The Australian Financial Review