The Energy Report | Feb 28, 2019 12:37AM ET

Pan Orient Energy Corp. (V: ) is a simple story; it was clearly described in its Valentine's Day press release. Pan Orient has about ~70c CAD in cash per share and Thailand 2P reserve worth about ~70c CAD per share, and it is trading not far from it. Currently, POE is drilling two appraisal wells right now in Thailand. If successful, they can significantly increase the 2P reserve. Pan Orient is also planning to drill a few high impact exploration wells in Thailand in the second half of 2019. The bottom line is that by the end of 2019, the company could significantly increase the existing Thailand 2P reserve.

The big upside is the Indonesia drilling by its partner Repsol (MC: ) (50-50). Repsol just made huge discovery not far from the location it is going to drill in May–June. If it can repeat the success, POE's stock price will be in the double digits.

Historically, POE has done little marketing and promotion; its shares have been under the radar for years. Management consistently bought shares from the open market, sold assets and paid shareholders big dividends in past years. I am pretty sure Pan Orient will do it again if it makes any significant discoveries in Thailand or Indonesia this year. If you love promotion, this is not your type of stock. However, if you think it is more important for management to deliver shareholder value than to spend time and money promoting the stories over and over again, POE should be on top of your list.

Disclosure:

1) Chen Lin: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Pan Orient Energy. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. I determined which companies would be included in this article based on my research and understanding of the sector.

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