ROK resources (ROK or ROKRF in USA)

It's a Canadian o&g company in a fairly fortunate and unique position. Junior oil and gas companies are a bit boom or bust, the costs associated with drilling is pretty high and you need high oil prices to make a good profit. This is why even at higher prices American companies still aren't fully committed ( they will be if this war keeps up as it has been ).

ROK is well managed with experience, and they did well during the price spike a few years ago during the Russia/Ukraine war. They managed to achieve in the neighbourhood of 5000boepd of mostly light oil mainly in Saskatchewan. However, like most companies when oil took a dive down to $60ish they began to struggle a bit, but they weren't in a bad position by any means. In fact they cleaned their company up and eliminated almost all of their debt in order to attract a buyer.

Long story short they ended up selling to an American company (Blue Alaska), at $0.24 a share. This was pretty good since shares were selling at $0.15ish at the time. However the buying company ran into some kind of troubles and ended up renegotiating around December last year, and in it was a clause saying that if the deal fails by such and such date, they owe ROK $3m dollars, and more importantly the deal is off. Well that day came and went literally days before this conflict started in the middle east, worst timing ever for the purchasing company.

Now oil is $40 higher, and Rok is pumping out 3000 boepd, with about 200 I imagine they have already put back online (it was essentially there to be turned on at any time). With a bit of spending, they will get back to 5000 soon I believe, probably this summer if oil prices remain high ( personally I believe even if this conflict ends they will remain elevated for some time ). The good news is that they hardly have any meaningful debt, and they have a nice cash injection of $3m to begin servicing and drilling. ( not quite yet, but in their PR they implied that it's without question according to the contract signed). Realistically, they're probably going to be a 7-8000 boepd producer given their properties, perhaps 10000.

To me they're absolutely undervalued, one of the most undervalued oil and gas producersout there by $/boe, but there's a few major catalyst which I think will play out over the next few weeks.

The main one is that since ROK had little debt, they should have been able to hedge almost all of their production at very high prices, depending on when and if they have, it should at least be in the $90s or perhaps in the $100s/barrel. Almost every other company out there has to hedge their production as a requirement to the lenders, and most of that for the last while has been at $60-$70 oil.

Second, this company has not been able to say much since the deal fell through, I imagine there's a stop for trading for the managers (large shareholders), and same goes for news, oil and gas companies are pretty good at pumping their own tires. They have set a date for Apr.9 for their latest financials, and I am sure that there will be very positive news about operations, and the plan going forward. There just has to be with the situation they're in.

So, they're currently trading at $0.26, which is just shy of where they were when they were sold to the American company at $0.24. from a $/boepd standpoint they should be in the $.40s, and if oil stays high for prolonged periods, Rok could be $1-$2 I believe.

While I'm sure there will be a sell off if say the war ended tmrw, I don't think oil prices will return to the $60s for some time. I'm fairly familiar with the industry through my job, and from what I gather there's been a lot of infrastructure damage and the backlog is so high it would take months just to make that up. Plus, I think North American companies were generally undervalued before this conflict ( the big ones like CVE, SU, chevron, oxy, etc), that there will be a repricing of "safe" sources in North America and less volatile countries.

ROK also owns 17% of and manages a somewhat promising lithium company called EMP metals (emppf), they're 17% owners. I haven't attached any value to it, but they're not a liability whatsoever -- they just own 17%. It's a bit of a lottery ticket included with ROK.

ROK.V in Canada, or ROKRF in the USA.