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Investing.com - Goldman Sachs initiated coverage on Tourmaline Oil Corp. (TSX:TOU) (OTC:TRMLF) with a Buy rating and a price target of C$73.00.
The investment bank identified Tourmaline as the largest natural gas producer in Canada, with operations primarily in Alberta and British Columbia provinces where it owns both upstream and midstream assets.
Goldman Sachs cited several factors supporting its positive outlook, including expectations for strengthening Canadian natural gas fundamentals as LNG export capacity increases in the coming months, potentially narrowing the AECO differential from current levels of approximately US$2.70/MMBtu to a through-cycle range of US$1.25 to US$1.50 per MMBtu.
The firm highlighted Tourmaline’s growth potential, projecting production to increase from about 640 Mboe/d in 2025 to approximately 850 Mboe/d by 2031, representing a 5% compound annual growth rate through facility expansion projects supported by the company’s inventory depth.
Goldman Sachs also noted that Tourmaline’s recent stock underperformance relative to the broader energy sector (declining 10% compared to the XLE’s 2% gain) creates potential for mean reversion into 2026, while the company’s marketing portfolio consistently supports gas price realizations by seeking exposure beyond local pricing.
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