May 6, 2025, ST. PETERSBURG, FL – Water Tower Research (www.watertowerresearch.com) has published an Initiation of Coverage Report on Journey Energy, Inc. (TSX: JOY) titled, “Long-Lived Legacy Asset Production Base Supports Funding Duvernay Growth”. The report can be accessed here.
Journey Energy is a Canadian exploration and production company that is pursuing a strategy of maximizing cash flows to pursue modest growth in the Duvernay Shale play in Central Alberta. Journey has a diversified production base of low decline assets in properties in Medicine Hat, Pine Creek, Gilby, Countess, and Matziwin and other areas in Alberta. The producing reservoirs include Glauconitic, Viking, Montney, Cardium and the Duvernay shale.
The current production at Journey is ~11,000 barrels per day (equivalent) with oil at 50% of the hydrocarbon mix. The company plans to invest cash flows from the production base into the growth of the Duvernay Shale, where they have 200 gross (60 net) locations for growth with wells targeting higher concentrations of oil and natural gas liquids than the current production profile.
The company also operates natural gas power generation assets with two key facilities that are expected to come online within the next year.
In March 2025, Journey completed a strategic financing transaction with a Canadian Chartered Bank that established new credit facilities, repaid outstanding term debt and extended the maturity dates of their debt. Journey has ~$43 million of combined undrawn capacity on the new credit facilities and ~$61 million of outstanding debt, including convertible notes. On a trailing last twelve months basis (FY 2024), Journey has a leverage ratio of ~1.0x Debt / Adjusted EBITDA. The company is currently trading at ~$4.19 per share of the proved developed producing assets as of the year end 2024 reserve report at a 10% discount rate which is ~33% of the current share price.
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