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Legacy Oil & Gas: Dramatic Discount To Book Value With A Prosperous Future Ahead

It has not been easy for Canadian Oil stocks this past year. Investors have been concerned with the large disconnect between WTI crude oil prices and the price Canadian oil producers are receiving.

As seen below, the gap between WTI prices and both Canadian oil indexes, the Western Canadian Select and the Edmonton Par has been widening.

The lack of pipeline capacity in western Canada along with growing reserves and production in the US are some of the main factors that have driven the discrepancy in oil pricing. This disconnect has punished western Canadian companies by squeezing margins and detracting investors.

As is the case with many market events, investors may act irrationally by over-reacting to situations. Luckily for us,...

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