CEO Message
Freydoon Khoie
In this month’s report, I discuss why you should invest in our fast growing PETRAX Oil and Gas shares at this Pre-IPO stage.
CEO/Chairman's Message
Why PETRAX Oil & Gas Shares in the Pre-IPO stage is the best investment today
The Oil & Energy World At Large
Over the past decade, energy transition efforts have intensified, but macroeconomic and geopolitical challenges since 2022 have tempered progress. Governments worldwide are now focusing on the development and use of renewable energy technologies. In 2024, energy and mining companies face numerous challenges amid a complex business environment and uncertain economic outlook, as we reed S&P Global’s latest report. Policy developments in 2022 and 2023 have created opportunities for the energy and mining sectors, particularly in the transition to renewable energy and critical minerals. However, 2024 is expected to bring significant headwinds due to elevated interest rates and slowing economic growth. Energy and utility companies, grappling with regulatory complexities and persistent inflation, face challenges in the rollout of both renewable and traditional energy infrastructure.
The energy landscape is influenced by four main disruptors – geopolitical factors, macroeconomic variables (like high interest rates and rising materials costs), evolving policies and regulations, and the emergence of new technologies. These factors significantly impact demand, supply, trade, and investment in the oil and gas industry. OPEC's output cuts and other disruptions have driven Brent oil prices above US$90/bbl, while US Henry Hub natural gas prices rebounded to US$3.50/mm Btu in November 2023. Despite these challenges, global oil demand is expected to grow by 2.3 mbpd in 2023, surpassing 100 mbpd for the first time. Electric vehicle sales increased by over 35% in 2023, with one in seven cars sold being an EV, highlighting regional differences in demand, infrastructure, technology adoption, regulatory policies, and socioeconomic factors. The industry is poised for a solid start in 2024, supported by its strong financial position and high oil prices, barring further macroeconomic deterioration. This strength is expected to facilitate investments, dividends, and a disciplined capital program, with the global upstream industry projected to maintain a 2023 hydrocarbon investment level of about US$580 billion and generate over US$800 billion in free cash flows in 2024.
The performance of the global oil and gas sector in 2024 is expected to be consistent with 2023 and stronger than mid-cycle levels. Oil prices are anticipated to remain high and relatively stable year-on-year, attributed to OPEC+'s production cuts, geopolitical factors, and a slowdown in US crude production. Although demand growth is expected to decelerate, the spare capacity, primarily held by OPEC, is likely to be sufficient to absorb potential shocks. Looking ahead to 2025, a decline in oil prices is assumed as OPEC+'s control over supply may ease. Companies with strong cash flow and low leverage are projected to report robust earnings in 2024, supported by favorable prices and ongoing cost control measures.
The energy landscape is influenced by four main disruptors – geopolitical factors, macroeconomic variables (like high interest rates and rising materials costs), evolving policies and regulations, and the emergence of new technologies. These factors significantly impact demand, supply, trade, and investment in the oil and gas industry. OPEC's output cuts and other disruptions have driven Brent oil prices above US$90/bbl, while US Henry Hub natural gas prices rebounded to US$3.50/mm Btu in November 2023. Despite these challenges, global oil demand is expected to grow by 2.3 mbpd in 2023, surpassing 100 mbpd for the first time. Electric vehicle sales increased by over 35% in 2023, with one in seven cars sold being an EV, highlighting regional differences in demand, infrastructure, technology adoption, regulatory policies, and socioeconomic factors. The industry is poised for a solid start in 2024, supported by its strong financial position and high oil prices, barring further macroeconomic deterioration. This strength is expected to facilitate investments, dividends, and a disciplined capital program, with the global upstream industry projected to maintain a 2023 hydrocarbon investment level of about US$580 billion and generate over US$800 billion in free cash flows in 2024.
The performance of the global oil and gas sector in 2024 is expected to be consistent with 2023 and stronger than mid-cycle levels. Oil prices are anticipated to remain high and relatively stable year-on-year, attributed to OPEC+'s production cuts, geopolitical factors, and a slowdown in US crude production. Although demand growth is expected to decelerate, the spare capacity, primarily held by OPEC, is likely to be sufficient to absorb potential shocks. Looking ahead to 2025, a decline in oil prices is assumed as OPEC+'s control over supply may ease. Companies with strong cash flow and low leverage are projected to report robust earnings in 2024, supported by favorable prices and ongoing cost control measures.
Our Methodology
On November 30, 2023 we acquired three entities such as a 2 million barrels per annum Refinery, 64,000 metric tons tank storages which are being expanded to 200,000 metric ton capacity at the Hamerya Port, and six vessels valued all together at $150 million and upon our expansion and annual upgrade and production improvements currently in process we expect a valuation of $200 million. PETRAX Corporation shares at this Pre-IPO stage is priced an offering of $40 million in 5.25% convertible senior secured notes due 2027 in a private placement, with an upsize of additional $200 million offer from the upcoming IPO for the acquisition of another brand new refinery with six million barrels of crude per annum refining capacity.
The Investment Opportunity
This offering includes an option for purchasers to acquire an additional $150 million shares. The net proceeds, along with cash on hand, will be used to pay the acquisition cost of the second refinery
Private investors will have 40 million shares or 40% of the ordinary shares of PETRAX Corporation that are worth $80 million after the second quarter valuations in our pre IPO stage which is at the development stage. My next point is that as we proceed to float 40 million of our shares on NASDAQ Dubai in 2024 the investors will take advantage of the Pre-IPO prices which is offered now in our private placement at $1,000 a share.
ur portfolio is balanced as an Oil and Gas industry unit that includes Shipping, Refining, Storage, and Trading with a focus on local market to achieve an annual $150 million sales revenue and 14% EBIDTA that involves in spin-offs, significant cost-cutting, and other types of under-appreciated business transformation to deliver strong performance up to 14% per annum that makes PETRAX one of the best energy shares to invest in.
Private investors will have 40 million shares or 40% of the ordinary shares of PETRAX Corporation that are worth $80 million after the second quarter valuations in our pre IPO stage which is at the development stage. My next point is that as we proceed to float 40 million of our shares on NASDAQ Dubai in 2024 the investors will take advantage of the Pre-IPO prices which is offered now in our private placement at $1,000 a share.
ur portfolio is balanced as an Oil and Gas industry unit that includes Shipping, Refining, Storage, and Trading with a focus on local market to achieve an annual $150 million sales revenue and 14% EBIDTA that involves in spin-offs, significant cost-cutting, and other types of under-appreciated business transformation to deliver strong performance up to 14% per annum that makes PETRAX one of the best energy shares to invest in.