Buy SIgnal on Lundin Energy (LUNE-SE)

We had an Enter Long Strategic signal on March 1, 2021, triggered by our system on Lundin Energy AB, LUNE-SE, the Swedish Energy Company.

Our system also triggered a bullish Tactical signal on January 12 2022, that suggest a bullish acceleration. Lundin has a rather strong record, with a Behavioral score of 7/10, therefore the bullish signal is to be considered as mainly Strategic.

Lundin Energy is a SEK 96 Bn market cap Oil & Gas exploration and production Company and a pure play of the Norwegian oil industry. Lundin has been extremely successful on the Norwegian continental shelf in terms of discovered resources, with significant discoveries including Edvard Grieg (2007) and Johan Sverdrup (2010) on the Utsira High, and Gohta (2013) and Alta (2014) on the Loppa High. These discoveries led to the decision of focusing on the Norwegian operations by rolling its UK. North Sea assets into EnQuest Plc in 2010, selling its Russian asset to Rosneft in 2013, and spin-off the assets in Canada, Malaysia, and France as International Petroleum Corp.

Lundin has industry-leading low operating costs, which gives it exceptional resiliency in low oil prices. Since 2015, the company has reduced its operating costs and total production costs substantially. Going forward, Lundin has a substantial amount of prospective resources in its portfolio of exploration licenses with planned drilling. Seven core areas have been identified off Norway, i.e., Central Graben, Sele High, Utsira High Area, Alvheim Area, and Horda in the Northern North Sea, Norwegian Sea, and Southern Barents Sea.

Lundin Energy and Aker BP two independent oil and gas producers in the Norwegian North Sea, recently announced plans to merge. The combination of the two leading North Sea operators will create a very large ($22b market cap, 400kb/d of production) alternative to major european integrated oils. The press release flagged $200m of synergies.

Short term catalyst : merger with Aker, rising oil prices.

This signal looks consistent with the European Oil & Gas sector currently in bullish momentum. There is currently 95% of European Energy stocks in bullish tactical signals and 62 % in bullish strategic signal .