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 I'm Charlotte Mloud with investingnews.com and here today with me is Joseph Shakar, president and author at the Shaker Energy Report. He's also a 40-year veteran of the industry on both the buy and sell side. Thank you so much for being here. Always great to catch up with you. >> Glad to be with you again, Charlotte. And uh to all your listeners and viewers, happy new year to them and I hope they had a nice holiday season. >> Yes. Well, thank you so much. Happy New Year to you as well. Definitely, we've

got a lot to get into today. And of course, we'll take a look forward into what's happening for oil and natural gas in 2026. But before we do that, I thought we could take a look back at 2025 for the oil market. I remember we did this conversation, I think almost exactly a year ago, and you were quite bullish on where prices could go in 2025. Of course, that outlook was adjusted throughout the year, but I'm wondering if we look at oil prices, what was it that kept them lower than at

least initially expected in the this past 12 months? >> Yeah, we started the year at $79 WTI and a lot of people were in the companies were using $80 oil in their forecasts and uh we started seeing weakening demand in the United States on the consumer side. Uh and then we had the tariffs. M President Trump came and took a 2x4 to the to global trade and that really knocked things off and we got cautious then uh and we said we're going to have a correction and we thought we would get below 60 and so we we said

that that could happen you know in the coming months and in April March April it did happen and so we have three things we watch for for our buy signal. One of them, the price of oil getting below economics. And so, um, the Federal Reserve of Dallas puts out a sheet talking about all the basins in Texas, and the average they need is about $65. Some down to, you know, the the 50s, some in the 70s, but the average is about 65. We were down, as you know, at $54 or $56 in in April. The second one is the S&P TSX energy index. We thought

it was trading in the 290s and we thought it would go below 240 which it did and it even went lower than that. Uh you went down to 214. Uh so that was a you know the second one we needed to check the boxes of saying we have a buy signal. The third one's very interesting. It's the emotion and bullishness to the sector. So there's an an index called the S&P Energy Bullish Percentage Index and in January that was at 80 and then historically it can correct down to um you know below 10% to

give you a buy signal. Anytime below 5% it's a table pounding buy signal. So in 2020 it got down to like 3 4%. 2008 during the financial crisis it got down to you know 3 4%. This time in April of 2025, it got to 0%. The lowest number ever recorded. So, we said we have all three of our check marks for a buy signal, table pounding buy signal, and we sent out a massive uh we sent out an action alert buy, sent out a lot of recommendations on the buy side, and they it's been a fabulous year. You

know, everybody talks silver and gold and how well they performed, but uh I can walk through names here and just show you, you know, how well they did. Birch Cliff, which is a name you and I have talked about, it was $4.71 at the low. It's $7.56 now. Um you you can go to um names like InPlay Oil. Um it was 654. Now it's $125. Um you know, Strath Kona, which is an oil name, 2275, got up to $45. So there's some great great great performances here. Um and there's dividend yielding stocks that did well.

We can talk about that. So um the ideas that we New Vista was a name we put on in April at $11. Ointive was in the process of taking them over at $18. So there's been some fabulous performances in the sector. 50% some doubles even in a year when oil was lousy. Um and natural gas is just now coming back to life at you know $3.15 for Eco but 460 for NAX. So the uh natural gas stocks because of LNG Canada and the export market and data centers, the natural gas stocks have done exceedingly well and

some oil stocks have done well. But I think the sector is really attractive for people um you know for the long term. But I think we're going to see a bit of a correction in Q1. Um and so we're going to be uh you know putting out a buy signal when that happens. Uh today the U price of oil is you know just under 58. Uh the S&P TSX energy index is in the 298 range. Um and the bullish percentage index is 49%. So it's down from 70 to 49. So it's got a little way to get below 10%. So we're going to

see this correction unfold. Um and January, February, March when the buy signal happens, we'll send it out. We've been recommending investors that whatever your to target waiting is for energy and again uh people in Eastern Canada may not want as much energy. people in Western Canada would want more. Um, so we've been saying 80% of your target level is where you should be at. On this next buy signal, we would say it's time to go to 100% of your target waiting. Now, that might only be

two names if you know if you have 30 names in your portfolio. If you're in Western Canada or Alberta, you might have eight of your 20 names in energy. Um, again, each area, you know, people have focus of their portfolios and comfort zone. The other thing is you can get great yields in the sector. There's a lot of companies even today yielding over 7%. So people want dividend income and capital gains. That's what, you know, that's where our portfolio, personal portfolio is where you want to

get names that give you a payday while you're waiting more than the bank pays you. And we're looking for upside. Um, you know, you know, as as the volumes grow as and as we get the higher commodity prices, cash flows will grow and multiples will expand. uh many companies today are trading at two three times cash flow which at the top of the cycle they'll trade at 8 [clears throat] n times cash flow many of them are trading at a third of nee and 2p nee and u you know and they're you know there's

there's a thing called pdp proved develop producing then 1 p and then 2p 2p is proven plus probable and so at the top of cycles you trade at 2p so we're trading at pdp like a one-third of that number of the and the upside is still there and if you add a higher commodity ity price and higher production you just get higher and higher numbers. So I think there's many se you know just like people you know you know two years ago looking at the golds and silver stocks and saying gold's moving silver is not

but you know the stocks are cheap well you know we saw in 2025 how how fast they can react. My view is that there's a lot of three, four, five baggers in the sector between now and the end of the the decade. And so we think that this is a sector that people should have exposure to. And people, you know, there's the the the gold stocks really don't pay dividends. Here's a way to get paid while you wait and have the upside potential of doubles, triples, or more. And uh and that's what we look at in our

in our in our in our universe is we look at um you know companies that are dividend payers with moderate capital gain potential. Uh then we look at growth stories and then we look at entrepreneurial names that could be the five and 10 baggers. So we try to get a mix of names depending upon what the client's risk profile is and what they're looking for. And then we cover domestic energy, international, Canadian companies working overseas, energy service and the royalty companies so that people can have a you know

depending upon their risk profile portfolio needs. Um you know we cover 31 companies. Um so you know we lost three this year with takeovers new Vista um we lost u uh Kitno and we lost STEP. So January, the next issue of my report, uh we'll be adding a new natural gas story that we think is very cheap and compelling uh for investors. So uh we're in the process of doing more research and bringing on some new names. Um so it's a fun time right now. >> It does sound like a very fun time and I

think a lot of our audience who is interested in gold and silver will really respond to the analog that you're drawing there. So it sounds like there's opportunities all up and down the chain for oil and natural gas companies. I wondered if we could step set the sta stage a little bit more for 2026 in terms of prices. You're mentioning perhaps we see the low in Q1 and then what unfolds from there. How are you looking at it for let's start with oil. Let's talk about oil prices.

>> Yeah, oil prices um you know as I mentioned we're just under $58. The low for the year was 54 just a few weeks ago. Um, I think we're going to be looking at Q1, uh, a little bit lower, 52 at the low end, um, and 66 in Q1 at the high end. Q2, we start seeing a better pricing environment, and I'm looking at 62 at the low end, up 10 bucks from the low end in in Q1. But I'm looking for 72 on the high on the upside. So, we're starting to peak over 70. That wakes the industry up. That

wakes people interest in the sector up. You know, it's like gold going over 2,000 or silver going over 50. You know, people wake up when that kind of thing happens. Q3, we're looking for inventories to start coming down globally, demand to pick up. People realize OPEC has not got more production coming on. And the uh inventory story, which is total garbage, you know, you hear people saying there's a three or four million dollar, you know, million barrel a day excess capacity out there.

I think that's totally false. And I'll I can go over that with you. If you remember when it was $79, everybody said there was a shortage of oil in January. So, you know, the narrative changes, you know, when the price goes down, they make a more bearish story and, you know, when you're $79, they give you the bullish story. And so, uh, I think in Q3, we're going to range between 68 and 78. And then the real progress will be made in Q4 when I have a range of 74 to 84. So, once we peak over 80, I think

multiples will start expanding. um and people will start putting in, you know, $80 go forward for cash flows. What does that mean? Companies with growth will start profiling their growth prospects. And I think we're going to see big big changes in terms of price um you know be from the low that I see coming in the months ahead uh and even from where we are today uh going into the end of 2026. So um I think in the beginning of this 2025 we had the high price we had the low price in December. I think we'll

have the low price in January, February, the high price in December of 2026, and then going higher. I think before the cycle is over, um the 2008 high of a dollar, $147 will be breached because the industry cannot respond quickly to to bringing on new oil. Uh think about an offshore discovery. It may take 10 years to put facilities on. Uh onshore, you may have a discovery. Um we have lots of gas in Western Canada. The problem is we have no pipelines and no LG on the coast. Uh so infrastructure becomes an impediment to the growth

which means you're going to have a longer bull cycle because it takes time to build the infrastructure uh to move the product to market and you know Asia is going to see a lot of demand growth Japan, South Korea, China. Um, and if we are going to have uh more data centers and we're going to have more of the grid improved, you're going to need more um copper, nickel, aluminum, zinc, rare earths. Um, and to bring that in the third world, they're going to use more energy. And the people who are working

in the in the field in the in those businesses are going to need more energy. They're going to want to have heating in their houses. They're going to want to have, you know, electricity. They're going to want to drive cars. And so um they're going to consumption is going to grow not in the OECD in the next few years but the growth will be in the non OECD and that's what the driver is going to be. Um and I think that's going to cause uh demand to go from you know let's say 105 million 105.2 in

2025. I'm using 106.3 as my number for 2026 but that number could be 112 by the end of the decade. 110 to 112. Um and it's all because of the third world that's going to bring on the resources that we need uh for the you know moving on all these issues be it data centers improving the electricity grid um and you know and then you know all the things you know even military applications you know Trump's got a new battleship or two that he wants to build and um and uh you know you know the the

the the drums are still on in Europe you know military drums are still happening and the war is still on there you know China's talking about doing things with Taiwan. You know, these geopolitical events can have a big increase on, you know, in the price of oil. You know, we got up to 120 when Russia invaded Ukraine. Um, in what in in 2008, we had massive strong economic demand. Um, and the the inventories went down to low levels. So, we went from $90 to 147 in 3 months. So, and it's, you know, just

think about gold and silver, the trajectory in the last few months. You know, people should think that that's should know that that can happen to energy. Just pull out the long-term charts for stocks or for oil prices and you can see that. >> Well, and and speaking about the geopolitical impact on the oil price, I'm seeing a lot of the headlines right now about the US Venezuela situation and what it could mean for the oil market. How would you break that down for investors? Well, the the [clears throat] um

American companies were there um and you know, Exon Mobile, Chronico, Phillips, u Chevron, u BP, Total, Repsol, you know, any all of them were there. Um and then in 2005, Chavez nationalized the industry and it was producing 3.3 million barrels a day. So those companies say they want their assets back and that's why you're hearing President Trump saying that, you know, they've stolen our oil and so, you know, they're producing now about 900,000 barrels a day. So could they go back to

23 million if the American companies and the international companies get their assets back and can increase their production? Yes, they can. So you go to the flip side of it. Canada in 2005 was producing about 2.5 million barrels and was shipping about 1.5 million to the United States. Today we produce 6.1 million and we ship 4.2 million barrels to the states of which over three million is heavies that go into the middle part of the states and down to the Gulf Coast. So if those companies, the American companies that would get

their assets back in Venezuela and they have refineries that they own in the Gulf Coast, they could be bringing their own oil from Venezuela into the markets there on the Gulf Coast. And that means Canada may lose production into the US, which means why we need takeaway capacity on the east coast. So TMX can maybe take another 3400,000 barrels, maybe with another expansion a little more. But the reality is the the we need at some point an additional takeaway pipeline to the West Coast. We can do

rail, but I think most people would say rail is stupid. uh you know because of the environmental concerns um and you know derailments and things like that which we've seen uh and all the problems with that. So to me I think we you know Canada's heavy oil industry is the least attractive to me of all of them. Light oil is attractive. Natural gas is the most attractive. So when we talk stocks I talk mostly about natural gas and natural gas liquids and light. And then when people say to me why don't you talk

about heavy oil stocks? I say we don't really we only cover one uh because it was ridiculously cheap when it when it you know and uh that was Straf Kona and um most of the time we really don't cover that sector uh because we're concerned about uh long-term market access um unless we get more takeaway capacity which you know given First Nations are against it. Premier Eie is against it. The prime minister is not so keen on it. Um you know even though he's saying we have anou but he wants carbon

capture first. So there's a there's a you know you don't have everybody on the buyin and right now we have the buyin on natural gas. The First Nations are there. They want to own uh own part of it. Uh they want to own some of the pipelines related to it. So we've got buyin from them. We got buyin from EB. We got buy in from the you know the legislature and be in Victoria. So government of Canada, the companies, everybody's on side for natural gas. Um the oil side is still um has has trans

has transaction problems, growth problems. >> Yeah. Yeah. You can see the differences in the situations there. And in terms of oil, I also of course wanted to bring up OPEC, always a hot topic. I believe the last time that we spoke, you were talking about how OPEC is getting close to its full production capacity and I'm wondering if you can share what you see coming in 2026. I know also for 2026, OPEC is believing that we're going to have a balanced market for oil. So just curious what you see coming there.

>> Yeah. Um, OPEC, as you remember, was adding 143,000 barrels a month, and they haven't been able to increase the production at that rate. So, it tells you that the basins and that the money being spent to increase production is not there. In the month of November, which is the last data that I've got in front of me, uh, OPEC produced 28.48 million barrels. Um, and it was down a,000 barrels from the previous month. So, they didn't add 143. Saudi Arabia increased production by 54,000, but you

had um Iraq down by 21,000, Iran down by 19,000, um Nigeria down by 11, Venezuela down by 27, and now, you know, with what Trump's doing now, that's going to be much lower, too. So, OPEC has really not had the ability to to to fill the market um that, you know, as it grows. And so if you have more production from, you know, the United States next year, Guyana, um offshore Brazil, uh maybe that's 5 600,000 barrels a day, but if demand grows by 1.1 to 1.3 million barrels, that's going to be the draw

down on on on storage around the world. And that to me is how you drive the price of oil higher. And um just to go through the the numbers on on on storage, which is really the issue. Um people say that um there's too much oil and there's 34 million barrels. That's the bears view. You've got three areas you want to look. The biggest consuming market, which is the United States, which is 23.5 million of production and demand is 20.5. They have um commercial stocks last week were 424 million

barrels that they have a 5-year band of 400 to 500. So, they're at the lower end of the band. So, the United States doesn't have a glut of oil. Onshore global uh commercial stocks were at 4.4 billion. That's the lower end of the global 5-year range of 4.4 to 5.1. The only one that's above is the offshore on the water inventories, which is where the shadow fleets from Iran, Venezuela, and Russia are looking for markets. That's at 2.3 billion barrels. And the 5-year range was 1.7 to2. So, it's 3400

million above. But when you take in account that the Americans are way below and the global numbers are below onshore, that tells me that there really isn't a glut except in one particular area. And um you know, if Russia does a deal with Ukraine and sanctions come off, then that can move into the market. Um and you know, if it goes into global inventories, then you know, we we're still within the range rangebound. And so to me, as we start eating into those inventories in second half of 2026,

everybody's going to wake up to the fact that the industry can't increase production easily. Um, you know, if you if you find it, it takes a while to bring it on, you know, in terms of pipelines and facilities and all the rest of it. So I think that we're going to see um a very strong market in the second half as I mentioned and I think that that continues into the years ahead um as people you know as we talk more and more about data centers and AI and all of that um and then the grid gets

tight and you know all of a sudden you have brownouts you know where the electricity is not available. If you remember even in winter of last year uh we had times when you know Alberta would put out warnings saying please don't use electricity because we're the grid's at capacity. So, you know, you know, don't put on the lights if you don't need to. Um, and so we've had those warnings in Alberta already. And I think we're going to see that happen Ontario, Quebec, and,

you know, right across many of the industrialized countries where the grids are at maximum and the industries have not spent money upgrading the grid or expanding the grid because they haven't had an attractive opportunity all until data centers showed up and then they woke up and say, "Oops, we got a problem here." And they've got to start spending money. And so you know they they're looking at you know nuclear you know small reactors there uh they're looking at more wind and solar uh but those also

take time and you know small modular reactors we still don't have a you know fine-tuned to what the right right you know facility is needed and and they can be built in a reasonable period of time. So natural gas becomes the one that benefits from it uh because it's the you know we have it we have pipelines we have the you know everything available and so um if we want more electricity capacity um natural gas is going to be the home run winner and you know US as I mentioned we're 460 something for US NAX

that could be 5 67 during periods of cold weather or when demand is very strong it could go to 10 you know that really leverages profitability and on oil we're right now as I said, you know, $58 range. Um, if we get up to 80 by the end of this year and then, you know, 100 120 3 4 years from now, all of that's going to leverage into cash flow for give the companies the money to spend on growth. And uh, and of course, if you have a choice of buying from Russia or Saudi Arabia or United States and

Canada, I think you're going to choose United States and Canada. You know, the US is the biggest producer at 23 and a half. Um, Saudi Arabia is just over 10 as I mentioned. Then you go to Russia which is about 9.4 and then Canada 6.1. Then it drops down to China at 4.3. So we're the fourth largest producer of oil in the world or liquids in the world and and we have a big natural gas growth business. So Canada be you know from being unattractive under the Trudeau years is now becoming okay and maybe

let's check Carney out and see what happens. But that could become uh where you know people realize Canada has the ability to grow to eight or nine million barrels a day. Um you know 10 or 15 BCF of export LNG in the next few decades. Um all of that is a very very positive and you know you've seen Tom Hodson our energy minister talk about energy um and uh and other you know areas of the resource sector um becoming the boom for or the wealth creators for Canadian for Canadians. And I think that has finally

gotten across to Carney. And of course, if if this Venezuela thing is is serious, as I think it is, they'll realize they need new markets because the American, you know, US market may not be there for us. Um, if the American companies are able to bring their own oil in from Venezuela in, you know, 2, three years from now. >> Yeah, very interesting changing situation for Canada. And also, I find it very interesting the data center demand for natural gas. There's so much focus as you mentioned on nuclear for

that but interesting to see how natural gas can play a role. Anything you would add in terms of demand for the oil side? I feel like there's always if for oil a lot of focus on what's happening with supply, but anything you'd note on demand for people to take away. Well, on the demand side, um, you know, we all think of gasoline and diesel and jet fuel, but they don't realize that a lot of the things that that that that oil produces, be, you know, be it the polyesters, be it, you know, be it my my

glass frames, be it, you know, any, you know, my my computer mouse, you know, all of these things have petroleum products in it. And more and more, you know, we're seeing that, you know, the the the the hard plastics and things like that. and even you know pharmaceuticals and other things have in it some of you know petroleum based to it and so I think people need to realize that um oil is not just what we consume in our cars uh but you know it's it's it's something that is expanding in use

as they find more opportunities to to you know and create products for it so I u I think that we're going to see you know number one the noncd be the biggest consumer increase and then second it'll be byproducts of energy that's also going to be um you know increased demand um and I think that u you know it's going to be um a re a real wakeup call to you know by 2029 uh 28 2029 when people realize the industry cannot respond with a lot of new production and that's when you see the price trajectory

really go crazy to the upside and as I said I thought we could get over 147 uh Warren Buffett who I think people know is a pretty smart investor he says that oil is going to be in such short supply. It could be over $200 US a barrel. So, you know, if he's willing to stick his neck out there, I'll stick mine at 147 and he can stick his out at 200. But I think the the argument in favor of something like a long cycle commodity like this is simply because it's not just the discovery. You know, if you're

watching Land Man, you might, you know, on on Paramont Plus, you know, you get an idea of what the oil industry is about. But the reality is it's the infrastructure that becomes the impediment for the product to show show up at market. And that's really what we we'll be watching in the years ahead uh to see how those uh and we're the um the infrastructure is built because whoever builds the infrastructure will be the ones to see the uh demand growth and those that don't uh for whatever reason

will not see it. >> Pretty significant I think to have Warren Buffett make that kind of call on oil prices. So thanks for bringing that up as well. And I think you mentioned natural gas prices a little bit as well, but just looking forward to 2026. What type of range are you looking? I know it's tricky with all the the weather related parts there. >> Well, right now, uh, as I mentioned, we're over 460 for for NX. You got cold weather. You've got big draw downs. One of the things I watched is the draw is

the US natural gas numbers. And going back um, you know, four or five months ago, the inventories were at the high end of the 5-year range. they were 8% above the 5-year range. Um the data that just came out this morning showed another 166 BCF draw down to 3.41. So we're now two 3.8 below a year ago, but we're now 0.7 below the 5-year average. So that's the first time we've seen a negative number. And so if we have good drawdowns because of more LNG takeaway in the states, more data center use, uh,

inventories come down because of all of that, I think we could be looking at five, $6 NAX on a regular basis. For Ako in Canada, we've had a glut in Canada. We've had high inventories. Um, and now we've got LG Canada over a BCF and probably two BCF in Q2 of 2026. uh they'll make an FID on the second you know the the second phase of it LNG Canada 2 u hopefully in Q2 uh and then all the others are moving through FID or or starting to be built so we could have u an industry right now that's producing

18 BCF in Western Canada it could have 6 to 8 BCF of incremental demand between now and the end of the decade that's really the story it's the incremental demand and the replacement of current production so that you got to have number For one, the industry is like treading. So, it's not really growing. It's meeting the demand right now, but all of a sudden, you got to add the demand of 6 to8 BCF of more. The industry has to start drilling more, bringing on more the infrastructure for

it. And uh so, it it's it's to me the stocks are trading right now at two to three times cash flow. At market peaks historically, like 2008, they were trading at 8 to 10 times cash flow. So, if you go from, you know, two to eight, that's a good multiple expansion. But then you take in account the commodity price going up, you know, and so if it goes from $2 to to $5, that's going to help out. Production increases will help out. And then on the net asset value side, companies are trading at a third

of their 2pnav. So there's proved development, proved non-producing and probable. So the industry historically at the bottom trades at, you know, at PDP, which is the low end, and at the top of the cycle, it trades at 2P. So we've got potential, you know, three, four, five baggers just on those movement of the multiples. But then you take into account the incremental cash flows from higher commodity prices. And then you take the extra from production growth. I think there's five and 10

baggers on our buy list that we cover. We cover 31 companies. Some won't grow will be moderate growth because they pay seven 8% dividends and the focus is on a little bit of growth, five six% growth and paying a seven eight% dividend yield while others are focused on um on on growth and uh and those are the ones that are going to be the home runs. And uh so we cover all of them because our client base wants, you know, are older. They want dividend income, you know, to replace, you know, money market or or or

bank uh you know, short-term deposits or T bills. And then they also would like to see some growth and they want a liquid company low, you know, great balance sheet, great management. So we try to cover the big boys that that fit that bill. And then we go down the spectrum to the more entrepreneurial names um that people can can get into. And just going back to, you know, you know, April, um when we put out the buy signals, we had a lot of stocks that went up, you know, 50% or more. You know, New Vista was 11, got T is taken

out by Aventive now at 18 bucks. Um you had uh you know uh things like Inplay trading at you know 654 it's now 1227 uh BClip which is a big natural gas producer uh was trading at 471 now it's 758. So there's been some great performers out there and so people should be looking at the sector um you know go to the websites and look at their presentations um you know if they want to have you know regular coverage then you know come to our website and and become subscribers. Uh but um you

know there's lots of opportunities u to to to to get comfortable with the stories be you know because the companies will have presentations on their website uh they'll have quarterly conference calls and then we have our as we've talked before our catch the energy conference in October and last year we had over 30 companies there and people got face-toface time with the company management of companies they owned or companies they were interested in and that facetime is very important for

individual investors because it's the only conference in Canada, you know, uh that really has a focus just on energy. Um and uh you know, the institutional market gets lots of coverage and lots of facetime with management. Individual investors don't. And again, that's what you guys do uh and that's what we do. Um and that's really important is to have that uh both the research side which we provide and the access to management. And that really gives you know a very strong um comfort zone for people to to

to follow the names buy the names and u and then and then be involved uh by by watching what the companies are doing. >> Definitely I agree those are two really important elements for investors to bring together. And on the note of the companies, I wanted to ask so you mentioned I believe at the beginning of the conversation that a number of the names that you follow are now out of this out of the story because of M&A activities. So is this an environment moving forward in in 2026? Do you expect

more mergers and acquisitions in the oil and gas sector? Yeah, I think um you know it you know it's the old story is it cheaper to buy than build and so do you do you want to you know buy land drill up the wells bring the production on or is it cheaper to buy it on Bay Street or Wall Street and right now stocks are so cheap that's why we're seeing a lot of M&A activity because it's cheaper to to to buy and you know came in and bought you know from Parammont came in and bought the new

Vista um you're seeing you know termine make acquisitions regularly arcs making them regularly. CNQ's making them regularly. So I think the consolidation of the Montney and Duivere will continue because that's the big you know natural gas with liquids or or or natural gas with oil and so people will want to own that sector. And then the other one is some of the light oil plays. I think the clear water sorry the Charlie Lake and others clear water is more of a heavy play but the you know if there's the

plays that are producing more where water fods can help where there's growth in production people will want to consolidate those areas and I think we're going to see more of that but the main action will be in the Monty and Duivere so that'll be in west five or the western part of Alberta and northeast BC and that's where we're seeing the the the the action in terms of uh takeovers and I think that uh consolidation will will continue in the next few years until the the buy versus

build decision um goes in favor of build because the stocks have gone up so much. >> Well, and just a small followup. You mentioned there's been so much activity in general. Are you liking the deals that you've been seeing over the course of the last year or so? >> Well, you know, if you go into into the U oil deals, meg got a, you know, a competitive battle there between Strathcona and Senovas. In the end, the shareholders at MEAG got a good price and they could either take cash or

shares in uh in Senovas. Um in the case of New Vista, you know, it's a cash or sharers of of Aventive. Um in the case of STEP, you know, ARC's buying them out, Arc, the um the um the money management side of of, you know, Arc Financial is buying them out. Uh they were the major shareholder, now they've taken it all in. Um and Kuwait got a private equity buyer that that took them out. So I think that um M&A will continue both from the private equity side but more so from big public players

that's that look at the land spread and say okay I'm here and I'm here somebody's in the middle that guy got to be I want that asset and so that's what we're seeing um from where they're taking out you know the their neighbors and saying you know we can operate it cheaper we have the facilities and uh we can lower the operating costs make it more profitable and we can get growth in volume And so that's what's going to happen. And uh you know, Termolene has been you know an inquisitor over the

years. Oventive is now which used to be in Canada now now knowive in the states. Um and I think we're going to see more and more ARC doing it. CNQ doing it. U the big boys will continue to digest the middle guys. The middle guys will digest the small guys and then the small guys will take out the money and build and start another company. >> All right. Well, I think that we've covered quite a lot of ground in terms of oil and natural gas in this conversation, but before I let you go,

is there anything you we missed or any final thoughts that you would want to leave people with as we're heading into a new year? >> Yeah, I think people should have some exposure to energy, be it, you know, if they're conservative, it could be pipelines and royalty trusts, um, or the royalty companies or if it can be, um, you know, growth, you know, with some dividend income. Uh, but there's lots of companies with 7 to 9% dividend yields even today. And if we get the correction

I'm talking about, then we'll get them even at better prices. And we'll be sending out action alerts when that happens to to subscribers so that they can take a look at the bargains that are available. Then I think the sector in overall is cheap. It's cheaper than the United States. That's a very important point is our stocks are cheaper than the US. U part because of the political side that we talked about earlier. Uh but I think that people should have exposure to the sector and um you know if you're

not exposed um you know people may want to just go to the big boys CNQ, Suncor, Termolene, Arc uh but if you're if you have the ability to invest more um look at the medium-siz companies that are growing and look at the service sector because as more utilization occurs in drilling rigs and in service rigs and in frack rigs or frack equipment um their ability to increase pricing goes up u and profitability goes up significantly. So um we we ourselves have exposure to all of those and we think people should

consider um appropriately what's and sit down with their investment advisor and decide what's appropriate for you. Uh but definitely look at the sector because if I'm right um it's like a year and a half u you know ago in gold and silver and we're just coming into the limelight um in the second half of 26. >> I think that's a great note to end on. So, thank you so much for coming on to review 2025. Take a look forward at 2026 and we'll be sure to have you back soon

so we can re-evaluate where we're at. >> It might be a pleasure. It would be. Thank you so much, Charlotte. >> Of course. And once again, I'm Charlotte Mloud with investingnews.com and this is Joseph Shakar. Oh.