With crude sliding from its peak earlier this month, many value stocks in Energy Sector are available at reasonable valuations. Because of their significant growth potential, small-cap stocks normally tend to outperform their large-cap peers over time. Remember, many large-cap stocks now were once small businesses with early investors reaping maximum benefit. However, not all small cap stocks turn multibaggers and there is always a risk involved with upcoming stocks.
The promising stocks on ASX are
Strike Energy Limited (ASX: STX)
Strike Energy Limited is poised to advance key project development activities during 2024. Recently, it received crucial approvals for the West Erregulla project and plans to reach a Final Investment Decision (FID) for this project within the year. Additionally, the company has significant plans to progress regulatory work and achieve an FID for its South Erregulla peaking power plant by early 2025.
Strike Energy Limited has recently commenced production at its Walyering Project, which is delivering increased production rates and enhancing revenue generation and profitability. Additionally, the company has a strong pipeline of other promising projects, offering substantial commercial and scalability opportunities.
On 27 June 2024, the company reported that it had started drilling the Erregulla Deep-1 (ED-1) exploration well in EP469. The company anticipates reaching total depth at ED-1 in about 40 days and will provide an update on preliminary observations at that time.
Earlier, on 24 June 2024, Strike submitted an application to the Australian Energy Market Operator (AEMO) for Certified Reserve Capacity (CRC) and a Network Access Quantity (NAQ) in support of the development and production of up to 85 MW of electricity from a proposed fully integrated peaking gas-fired power plant. This power plant will be fuelled by the South Erregulla gas field and built on Strike's wholly owned land known as The Precinct. As of 31 March 2024, Strike maintained a robust cash position of $44.6 million.
Empire Energy Group Limited (ASX: EEG)
Empire Energy Group Limited is poised to make significant strides towards construction activities for its Carpentaria Pilot Project in 2024, aiming for commercialization by 2025. The company's long-term scalability prospects also hold promise, supported by a substantial market opportunity.
Empire has promising plans to capitalize on the favorable market fundamentals of gas, with a significant projected future deficit. The company has outlined a three-phase commercialization strategy for its fully owned acreage, which is the largest land holding in the promising Beetaloo Basin. In Phase 1, Empire plans to address the Northern Territory gas market deficits through its Carpentaria Pilot Project, expected to yield 24 mmcf/d. Looking ahead, the company’s long-term scalability plans are equally promising. Phase 2 targets the Australian East Coast gas market, where demand is expected to significantly outpace supply as highlighted in the graphic above, creating a strong market opportunity. This expansion aims to achieve a production capacity of approximately 190 mmcf/d. Moreover, Empire plans to leverage the global LNG market, where demand is projected to outstrip supply by 2027. This will enable the company to capitalize on its full field development in LNG, capable of producing 1 bcf/d, providing significant scalability and sales growth potential through export.
Source: Company's Reports
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