Analyst Deep Dive Into BUCE’s Re-Rate Case

Dear Reader,

We recently sat down with David Mirzai, Head of Energy Research at SP Angel, following the publication of his latest research note on Buccaneer Energy (LSE:BUCE), and there’s plenty for investors to dig into.

WATCH: Analyst Deep Dive into the Re-Rate Case for BUCE

The headline number is SP Angel’s 12-month target price of 0.05p, well above the company’s current share price of around 0.012p.

• In other words, David sees plenty of room for the market to reassess the story if Buccaneer can keep delivering.

Click here to watch Mark’s full interview with David and hear more about the thinking behind the upside case.

The starting point is Buccaneer’s turnaround in East Texas.

Production currently sits at around 135 barrels per day, with the company targeting approximately 200b/d by year-end 2026, primarily through the proposed Fouke waterflood programme, expected to begin in Q4 subject to approvals.

SP Angel expects those higher volumes to generate material free cash flow, giving Buccaneer greater scope to reduce debt and fund further growth.

As David tells Mark, though, one important next step is proving that cash generation consistently through the company’s reported financial results.

After all, Buccaneer has gone from a business losing cash to one generating positive cash flow. Building a clearer track record could help strengthen investor confidence in the Texas asset base—and, in turn, support a re-rate.

Then there’s Europe.

Buccaneer has partneredwith Orion Resources to pursue conventional onshore gas opportunities, with an initial shortlist targeting up to three projects across Italy, the Czech Republic and Turkey.

• Together, those opportunities have estimated P50 potential of around 250bcf and an NPV10 of approximately US$500m on a successful development case.

Elsewhere, David also highlighted the appeal of a capital-light model, with Buccaneer securing attractive acreage, using modern seismic reprocessing to reduce geological risk, and then looking to bring in larger partners before committing significant development capital.

Other discussion points include:

• Why the market may still need to see a clearer track record of sustainable cash generation.

• Why the changing European gas market could create an attractive backdrop for Buccaneer’s next phase of growth.

• How a farm-out model could allow Buccaneer to create value without funding the most capital-intensive stages itself.

At a market cap of only around £3m, successful delivery in Texas or Europe could begin to change the valuation picture significantly for Buccaneer. Deliver on both, and there could be considerably more for the market to reassess.

CLICK HERE to read the full SP Angel research note and HERE to watch our interview with David Mirzai.

Best wishes,
The StockBox Team