Maintain BUY and Target Price
This morning, Trillion Energy International Inc. (“TCF”) provided an operational update on the current seven well program in the SASB gas field (49% W.I.). The recently drilled South Akçakoca 2 well has been placed on production at an initial rate of 3.0 MMcf/ d. Management continues to monitor the well and expects to gradually increase the production rate over time. TCF also announced an update on the recompletion operations
of the Akçakoca 3 well. Fishing operations successfully recovered over 600 kgs of old wireline cable from the well. TCF also milled out the old packer, which was pushed down into the well, below the deepest perforation interval. The well is now cleared and TCF expects to re-perforate the well, including ~34 metres of unperforated gas pay. Operations are expected to be completed this week.
The South Akçakoca 2 well was placed on production ahead of schedule. The Akcakoca-3 well has experienced some delays, but is now ready to be perforated. We maintain our BUY recommendation and our $1.35 target price, based on a 3.0 x multiple of our 2024F debt-adjusted cash flow.
