Tourmaline Reaches Record on Energy Asset Boost: Calgary

Tourmaline Oil Corp., Canada’s top performing energy stock this year, jumped the most in almost a year after it said its Spirit River Charlie Lake oil and gas pool in Alberta has evolved into a major new asset.

Tourmaline rose as much as 7.8 percent to a record C$46.10, the biggest intraday gain since Aug. 3 and was up 5.1 percent to C$44.94 at 11:57 a.m. today in Toronto. The stock has surged 43 percent this year, the best-performing stock on the Standard & Poor’s/TSX Energy Index.

Tourmaline said it expects more than 500 million barrels of oil equivalent are recoverable from the area. The Calgary-based company has drilled 43 horizontal oil wells in Charlie Lake since 2011 and none of have been dry, Tourmaline said in a statement released after markets closed yesterday.

The asset increase boosts Tourmaline’s Charlie Lake oil-play seven fold, Luc Mageau, Calgary-based analyst at Raymond James, said in a note to clients. Tourmaline is the firm’s top gas-focused stock and Mageau raised his 12-month target price to C$51 from C$49.

Tourmaline said it is set to hit 80,000 barrels per day of average production over 2013 while dropping its expected second-quarter output to 71,000 after several unplanned shutdowns.

The company didn’t have much control over the shutdowns, said Michael Harvey, an analyst at RBC Capital Markets in Calgary.

“I think the markets likely will look through that just given their historical record of outperformance,” said Harvey, who moved his price target to $C50 from C$45 today. “We think their industry-leading pace of production per-share growth should continue.”

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