Patience and discipline are key virtues for speculation in the stock market, as developments often fail to occur "on time" or "as expected." However, this does not negate potential opportunities down the road.
A prime example is Tenaz Energy Corp. (TNZ:TSX), an overlooked company with a robust risk-reward profile.
Despite frustration over the lack of M&A activity, Tenaz remains focused on international deals where management has a competitive edge. Meanwhile, the stock was a top TSX performer in 2022.
With half its modest market cap in cash and plans to grow, Tenaz represents an arbitrage many institutions currently cannot play, awaiting the day it meets their mandate thresholds.
TAG Oil Ltd. (TAO:TSX.V; TAOIF:OTCQX) has tested investor patience while drilling operations faced setbacks in Egypt's Abu Roash F formation.
However, the company has paid its tuition to solve these geological issues.
Now better prepared operationally, Tag Oil expects to reach total depth and production testing in March.
Success could quickly shift sentiment and valuations.
For New Stratus Energy Inc. (NSE:TSX.V), a recently closed Venezuelan deal lacks detailed economics but estimates 10-40 million risked barrels, with additional oil service revenues.
Risk factors in Venezuela naturally persist. Yet this play remains relatively small for heavy oil exposure.
Stocks like Condor Energies Inc. (CDR:TSX.V), Valeura Energy Inc. (VLE:TSX; PNWRF:OTCMKTS), Hercules Silver (BADEF:OTCMKTS;BIG:TSXV), and Critical Elements Corp. (CRE:TSX.V) round out speculative options anchored more in value than immediate catalysts. Time will tell whether patience pays for those still awaiting key developments.
Meanwhile, sectors like gold, uranium, and natural gas retain underlying tailwinds in 2023. Various mining equities seem discounted against record spot gold.
NexGen Energy Ltd. (NXE:TSX; NXE:NYSE.MKT) and the Sprott Physical Uranium Trust (U.UN.TO) provide focused uranium exposure. And natural gas producer Advantage Energy Ltd. (AAV:TSX) could benefit if prices hold above US$4.
With early disappointments in 2024, the virtue of patience helps endure. Just as minor home renovation issues fail to deter dinner guests from appreciating the final product, temporary drilling setbacks need not negate oil fields' ultimate potential. Staying disciplined through the ups and downs of speculating on natural resources and minerals can set the stage for eventual gains.
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