TD Newcrest Action Notes January 11, 2011

January 11, 2011
Action Notes Equity Research

2 of 86
RATING/TARGET/ESTIMATE CHANGES
ACE Aviation Holdings Inc. (ACE.A-T, ACE.B-T) C$12.86 ...... 4

SPEC. BUY (Unchanged);Target: C$16.00 ↓ (Prior: C$17.00)
Updating NAV to Reflect Revised Air Canada Target
Advantage Oil & Gas Ltd. (AAV-T) C$6.72 ...... 7

HOLD ↓ (Prior: BUY);Target: C$7.50 ↓ (Prior: C$8.00)
AAV-Reduced natural gas pricing results in lower target/rating
Alange Energy Corp. (ALE-V) C$0.50 .... 10

BUY ↑ (Prior: HOLD);Target: C$0.75 ↑ (Prior: C$0.70)
Upgrading to BUY
Canacol Energy Ltd. (CNE-V) C$1.54 .... 14

Upgrading to BUY
Crescent Point Energy Corp. (CPG-T) C$42.38 .... 18

HOLD ↓ (Prior: BUY);Target: C$45.00 ↓ (Prior: C$46.00)
NAV Update Results in Slight Target Reduction, Rating Lowered
Eldorado Gold Corp. (ELD-T, EGO-A) C$16.90 .... 21

BUY (Unchanged);Target: C$21.00 (Unchanged)
Long Term Outlook Points to Strong Organic Growth Prospects
HudBay Minerals Inc. (HBM-T) C$16.21 .... 27

HOLD (Unchanged);Target: C$18.00 ↓ (Prior: C$20.00)
Norsemont acquisition success hangs on exploration upside
Nexen Inc. (NXY-T, NXY-N) C$21.82 .... 30

Time to Show Some Love - Upgrading to BUY
Paramount Resources Ltd. (POU-T) C$31.43 .... 35

REDUCE ↓ (Prior: HOLD);Target: C$26.00 ↑ (Prior: C$25.00)
POU-Target Up, Rating Down On Share Price Performance
Pengrowth Energy Corp. (PGF-T) C$12.85 .... 38

HOLD ↓ (Prior: BUY);Target: C$14.00 (Unchanged)
Rating Reduced on Strong Share Price Performance
PetroBakken Energy Ltd. (PBN-T) C$21.78 .... 41

BUY (Unchanged);Target: C$26.00 (Unchanged)
PBN - 2011 Capex & Prodn Guidance + Bank Line Increased
Please see the final pages of this document for important disclosure information.
January 11, 2011
3 of 86
TMX Group Inc. (X-T) C$37.19 .... 46

HOLD (Unchanged);Target: C$38.00 ↑ (Prior: C$35.00)
December Stats: Solid Trading & Financing Activity
Talisman Energy Inc. (TLM-T, TLM-N) C$22.20 .... 52

HOLD ↓ (Prior: BUY);Target: C$25.00 ↑ (Prior: C$24.00)
Positive Long-term Outlook Unchanged - Downgrading on Valuation
GENERAL COMPANY NOTES
Canadian Oil Sands Ltd. (COS-T) C$25.46 .... 55

HOLD (Unchanged);Target: C$28.00 (Unchanged)
Transfer of Coverage - Maintaining HOLD Recommendation
INDUSTRY NOTES
Energy Producers .... 58

Year-end Commodity Price Deck Update
Industrial Products .... 68

November Building Permits Disappoint
Media .... 77
Canadian Media Industry Review 2011
INTRADAY NOTES (published January 10, 2011)
Enablence Technologies Inc. (ENA-V) C$0.49 .... 81

HOLD (Unchanged);Target: C$0.55 ↓ (Prior: C$0.60)
December Quarter Guidance Reduced
January 11, 2011
4 of 86
Transportation/Aerospace Tim James, CFA Scott Farley, CA (Associate)

Recommendation: SPEC. BUY
Unchanged
Risk: SPECULATIVE
12-Month Target Price:
Prior:
C$16.00↓
C$17.00
ACE Aviation Holdings Inc.
(ACE.A-T, ACE.B-T) C$12.86
12-Month Total Return: 24.4%
Market Data (C$)
Current Price $12.86
Updating NAV to Reflect Revised Air Canada Target
52-Wk Range $6.05-$13.53
Mkt Cap (f.d.)($mm) $418.0 Event
Dividend per Share $0.00
We recently updated our commodity and currency assumptions for our air
Dividend Yield 0.0%
Avg. Daily Trading Vol. (3mths) 69,399 transportation coverage list. Due primarily to the impact of higher oil prices,
Financial Data (C$) we reduced our earnings forecasts for Air Canada and our Air Canada target
Fiscal Y-E December price to $6.50 from $7.50.
Shares O/S (f.d.)(mm) 32.5
Float Shares (mm) 32.5
Net Cash ($mm) $366.3
Impact - SLIGHTLY NEGATIVE
Net Debt/Tot Cap NA As a result of the change to our Air Canada target, we are reducing our ACE
Cash ($mm) $366.3 Aviation target price to $16.00 from $17.00 and maintaining our Speculative
BUY rating.
Notes:TD Newcrest estimates
For our Air Canada forecasts, we have increased our WTI oil price
All figures in C$, unless otherwise specified.
assumption to $93/barrel ($85/barrel previously) for FY11 and $95/barrel
($88/barrel previously) for FY12 based on the current futures curve. We have
increased our US$/C$ assumption $0.03 (to $0.99) for FY11 and $0.02 (to
$0.98) for FY12.
We estimate that ACE’s holding company discount is currently 12.9%. With

ACE taking steps that we believe are aimed at an eventual dissolution of the
company, we expect this discount to continue trending lower. However, given
the modest 290bp differential between our target holding company discount
(10%) and the current market-value implied holding company discount, the
majority of the return to our ACE target continues to come from the
substantial upside implied by our Air Canada 12-month target.
Given the uncertainty regarding the timing of a sale of ACE’s remaining stake
in Air Canada, there is clearly downside risk to our target price in the event
that a sale occurs below our Air Canada target price. If we were to assume
that ACE divested its remaining stake in Air Canada at current market prices
($3.60) and sold its Air Canada warrants for their intrinsic value, our current
valuation methodology would imply a target of approximately $13.00 (using a
10% holding company discount).
ACE.A-T: Price
Company Profile 30 30
ACE Aviation Holdings Inc. is a holding 25 25
company of various aviation interests.
20 20
Holdings consist of an 11% interest in Air
Canada, a $366 million cash balance and Air 15 15
Canada warrants. Air Canada is Canada's 10 10

Please see the final pages of largest domestic and international full service 5 5
this document for important airline.
0 0
disclosure information. 2008 2009 2010
January 11, 2011
5 of 86
Valuation and Justification of Target Price

We value ACE by summing our estimated value of its component operating companies and adding in the
estimated value of net assets in the holding company (Exhibit 1). Assets include $366 million in estimated net
cash, the company’s 11% interest in Air Canada and 2.5 million Air Canada warrants. We then apply a 10%
holding company discount.
Key Risks to Target Price

Overall air traffic levels, sustained high oil prices, fluctuation in the value of the Canadian dollar, potential for
increasing competition and capacity, management’s ability to monetize business units and trading prices of
those units, execution of share repurchase or special dividends, and management/union relations.
Investment Conclusion
We are reducing our target price to $16.00 from $17.00 and maintaining our Speculative BUY rating on ACE.
Exhibit 1: ACE Aviation Holdings Inc. – Net Asset Value Derivation of Target Price
Current Market TDN Target

(all figures in 000's, unless noted) Price NAV NAV
Air Canada (11%)

Current share price $3.60 $6.50
Current shares outstanding 278,149 278,149
Market Value of Equity 1,001,336 1,807,968
Percentage held by ACE Aviation 11.1% 11.1%
Value per ACE Aviation share $3.44 $6.20
Percentage of total ACE Aviation NAV 23.3% 35.0%
Remaining ACE Holding Company Net Asset Value (100%)

Cash 366,288 366,288
Warrants (1,250,000 - $1.51 strike; 1,250,000 - $1.44 strike) 5,225 12,575
Other Debt -
Net Obligations (4,000) (4,000)
Net Assets (Liabilities) Remaining in HoldCo. 367,513 374,863
Value per ACE Aviation share $11.32 $11.53
Percentage of total ACE Aviation NAV 76.7% 65.0%
Other Data
ACE A and B Shares Outstanding 32,465 32,465
Issued upon Exercise of Options - 45
Cancelled Due to Issuer Bid - -
Total A and B Shares Assumed Outstanding 32,465 32,510
TOTAL ACE AVIATION NAV per share $14.76 $17.73

Current ACE Aviation share price $12.86 $12.86
Discount to NAV 12.9% 27.5%
Target Holding Company Discount 10.0%

TD Newcrest Target $15.96
Source: Company reports; TD Newcrest estimates
January 11, 2011
6 of 86
Exhibit 2: Justification and Key Risks to Target Prices of ACE Subsidiaries
Stock Name Ticker Share Price Target Price Rating Justification of Target Price
Air Canada AC.A, $3.60 $6.50 SPEC. BUY Our target is based on applying a 5.0x multiple to estimated EBITDAR for the
AC.B four quarter period ending September 30, 2012.
Stock Name Ticker Share Price Target Price Risk Rating Key Risks to Target Price
Air Canada AC.A, $3.60 $6.50 Spec. Overall air traffic levels, a sustained high fuel price, fluctuations in the value of
AC.B the Canadian dollar, potential for increasing competition and capacity, debt
levels, pension funding, financial leverage, variable voting shares, and
management/union relations.
Source: Company Data, TD Newcrest Estimates.
January 11, 2011
7 of 86
Energy Producers - Intermediate Roger Serin, P.Eng. Aaron Bilkoski (Associate)

Recommendation: HOLD↓
Prior: BUY
Risk: HIGH
Prior:
C$7.50↓
C$8.00
Advantage Oil & Gas Ltd.
(AAV-T) C$6.72
Market Data (C$)
Current Price $6.72
AAV-Reduced natural gas pricing results in lower target/rating
52-Wk Range $5.69-$8.32
Mkt Cap (f.d.)($mm) $1,144.4 Event
Dividend per Share --
Target and rating lowered with new commodity and YE-2010E reserve
Dividend Yield --
Avg. Daily Trading Vol. (3mths) 516260 estimates.
Financial Data (C$)
Fiscal Y-E December Impact
Shares O/S (f.d.)(mm) 170.3 Negative
Float Shares (mm) --
Net Debt ($mm) $483.0
Net Debt/Tot Cap -- Details
Entering 2011 we are i) updating our commodity price forecast; ii)
Estimates (C$)
Year 2009A 2010E 2011E 2012E introducing 2012 estimates; iii) estimating year end 2010 reserves and using
CFPS (f.d.) 1.26 1.04 1.10 1.15 this updated reserve estimate in our Net Asset Value analysis (both
CFPS (f.d.)(old) -- 1.03 1.21 -- Blowdown and Modified Growth).
Debt/CF 2.6x 2.8x 2.3x 2.1x
Oil (b/d) 9,509 7,226 6,795 6,521
Outlook
Gas (MMcf/d) 104.5 101.3 125.0 134.8
MBOE/d 26.9 24.1 27.6 29.0 Although WTI crude oil prices recently tested levels above US$90/bbl, we are
taking a somewhat conservative view on prices and are estimating a WTI
Valuations
price of US$85/bbl through 2011 and 2012. In our view, fundamentals for the
Year 2009A 2010E 2011E 2012E
EV/DACF 5.9x 7.9x 7.2x 6.9x
commodity, including inventories along with the supply and demand balance
P/NAV -- 87.0% -- -- do not support current prices.
Supplemental Data
Year 2009A 2010A 2011E 2012E Looking at natural gas, above-average withdrawals have somewhat reduced
WTI (US$/bbl) $61.97 $79.50 $85.00 $85.00 the overhang in inventories; however, seasonal gas inventory levels remain
NYMEX (US$) $4.16 $4.36 $4.50 $5.25 near record highs due to ample supply. Given the continued oversupply of the
AECO (C$) $4.00 $3.99 $3.90 $4.65
F/X (US$) $0.88 $0.97 $0.99 $0.98
commodity, we are now estimating a NYMEX gas price of US$4.50/mcf
(previously $5.75) in 2011 and US$5.25/mcf in 2012. Our new commodity
price forecasts are outlined in Exhibit 1.
Our cash flow forecasts for Advantage have been reduced on the back of
our lower natural gas price assumption. As a result of lower cash flow
combined with a reduced subjective factor of 5/10 (previously 6/10) we
are lowering our target price to $7.50 (from $8.00). We are also lowering
our rating to HOLD (previously Buy).
AAV-T: Price
Advantage Oil & Gas Ltd. (AAV) is a 12 12
Canadian oil and natural gas exploration,
10 10
development and production company
focused on the Glacier area located on the 8 8
Alberta / B.C. border between Grande Prairie 6 6

Please see the final pages of and Dawson Creek. 4 4
this document for important
2 2
January 11, 2011
8 of 86
Exhibit 1. Revised Commodity Price Forecast

2010A 2011E 2012E
TD Estimate Futures Futures
Commodity Actual NEW Old Futures vs TD TD Futures vs TD
WTI (US$/bbl) $79.50 $85.00 $80.00 $93.23 10% $85.00 $93.94 11%
Edmonton ($/bbl) $76.80 $83.50 $80.90 - - $84.60 - -
NYMEX (US$/mcf) $4.36 $4.50 $5.75 $4.56 1% $5.25 $5.08 -3%
AECO ($/mcf) $3.99 $3.90 $5.10 $3.99 2% $4.65 $4.49 -3%
FX (US$) $0.97 $0.99 $0.97 $1.00 1% $0.98 $0.99 1%
Source: Bloomberg, TD Newcrest.
Valuation
P/NAVBD P/NAVMG EV/DACF EV/BOEPD EV/2PBOE D/CF Payout Yield % Gas
(Futures) (Futures) (2011E) (2012E) (2011E) (2012E) (2009A) (2011E) (2011E) (2011E) (2011E)
AAV 87% 87% 7.2x 6.9x $55,578 $52,279 $6.81 2.3x 75% - 75%
Average 157% 101% 10.2x 8.8x $93,744 $90,489 $25.91 2.1x 122% 5% 53%
>60% Gas 154% 112% 11.9x 9.2x $76,205 $68,787 $23.48 3.0x 135% 2% 78%
>60% Oil 168% 100% 9.6x 9.2x $127,358 $127,682 $32.73 1.3x 110% 6% 26%
Yield 159% 98% 9.6x 8.6x $93,236 $92,893 $24.16 2.1x 118% 5% 49%
No Yield 148% 115% 13.0x 9.8x $95,901 $80,269 $33.37 2.1x 141% 0% 70%
i) EV based on forecast year-end net debt and units outstanding, ii) Payout = (Capex+Dividend-DRIP)/CF
Source: Company Reports, TD Newcrest
Justification of Target Price

Our target price reflects a base valuation of $7.42 that combines 1.0x our modified growth NAV of $7.72 at a
65% weighting and $6.87 using an EV/DACF multiple of 7.0x 2011E DACF at a 35% weighting. This is then
adjusted by a subjective factor of 0% (within a range of +/- 25% for the sector).

Key risks associated with our target price include business risks of the company and industry, including but not
limited to: loss of key employees, drilling success, volatile commodity prices, operating costs, capital cost
overruns, product supply and demand, financing/access to capital, government regulations, legislation,
royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to
Advantage include asset concentration of the capital program in the Glacier region.
The company continues to develop its core liquids rich Montney natural gas asset at Glacier. The current
development plan is expected to bring production from the area to 100 mmcf/d (representing ~50% of total
corporate volumes). Upon completion of this current phase of development by Q2/11, production from the area
will have approximately doubled in twelve months. Asset sales and increasing production give the company
increased flexibility relative to its credit facility. However, at current gas prices we forecast that capex in 2011
will drop 35% from 2010, reflecting completion of its expansion at Glacier. While it has clearly demonstrated
the potential of the Glacier property and is meeting its growth expectations for the play, we highlight the
higher-than-average Future Development Capital (FDC) associated with its YE-2009 reserve report, largely we
expect for development of Glacier. The company has booked FDC of ~$1.3 billion equating to 6.2 years of
capital spending at 2010 levels, well above the average of 1.6 years within our coverage group.
January 11, 2011
9 of 86
TICKER TARGET RATING

ADVANTAGE OIL & GAS LTD.
AAV $6.72 AAV $7.50 HOLD
Per Share Metrics 2005A 2006A 2007A 2008A 2009A 2010E 2011E 2012E
CFPS (fd) $3.67 $2.57 $2.21 $2.52 $1.26 $1.03 $1.10 $1.15
DPS (Basic) - - - - - - - -
NAVMG - - - - - $7.72 - -
Valuation
Share Price (Avg) $19.76 $18.64 $12.37 $10.09 $5.29 $6.72 $6.72 $6.72
Shares Outstanding (Basic - Period End) 57.8 105.4 138.3 142.8 162.7 163.7 163.7 163.7
Market Cap ($mm) $1,143 $1,965 $1,710 $1,441 $862 $1,100 $1,100 $1,100
Net Debt ($mm) $410 $624 $788 $875 $502 $483 $435 $415
Enterprise Value ($mm) $1,553 $2,589 $2,498 $2,316 $1,363 $1,583 $1,535 $1,515
Yield - - - - - - - -
P/NAV - - - - - 87% - -
P/CF 5.4x 7.3x 5.6x 4.0x 4.2x 6.5x 6.1x 5.9x
EV/DACF 6.7x 10.8x 8.2x 5.8x 5.9x 7.9x 7.2x 6.9x
EV/BOEPD $77,196 $108,996 $83,362 $71,763 $50,621 $65,638 $55,578 $52,279
EV/2PBOE (Pro Forma) $18.63 $21.48 $16.54 $13.36 $5.87 $6.81 - -
Production
Oil & NGLs (bbls/d) 7,029 8,074 10,462 11,792 9,509 7,226 6,795 6,521
Heavy Oil (bbls/d) - - - - - - - -
Gas (mmcf/d) 78.6 94.1 117.0 122.9 104.5 101.3 125.0 134.8
Total BOE/d (6:1) 20,122 23,753 29,961 32,273 26,930 24,113 27,624 28,980
Gas % 65% 66% 65% 63% 65% 70% 75% 77%
Reserves (mmBOE) (Pro Forma)
PDP 45.2 66.3 78.1 71.3 51.3 51.3 - -
Proved 53.6 78.0 94.7 101.4 107.9 107.9 - -
Proved + Probable 83.4 120.6 151.0 173.4 232.3 232.3 - -
% Proved 64% 65% 63% 58% 46% 46% - -
RLI & Capital Efficiency
RLI (Proven) 7.6 7.3 7.6 8.8 13.1 - - -
RLI (P+P) 11.9 11.4 12.1 15.1 28.2 - - -
FD&A + FDC (Proven) $21.82 $34.33 $25.15 $24.40 $24.05 - - -
FD&A +FDC (P+P) $17.17 $26.02 $19.13 $16.68 $11.66 - - -
Recycle Ratio (Proven) 1.3x 0.7x 1.0x 1.2x 0.8x - - -
Recycle Ratio (P+P) 1.7x 0.9x 1.3x 1.8x 1.7x - - -
Growth
Production Growth
Absolute - 18% 26% 8% (17%) (10%) 15% 5%
Per Share - (17%) (15%) (8%) (24%) (16%) 14% 5%
Per Share (Debt Adjusted) - (19%) (19%) (15%) (35%) 11% 12% 7%
P+P Reserve Growth
Absolute - 45% 25% 15% 34% - - -
Per Share - (21%) (5%) 11% 18% - - -
Per Share (Debt Adjusted) - (24%) (3%) (7%) 61% - - -
Netback ($/BOE)
Gross Revenue $53.17 $47.80 $49.27 $65.14 $34.90 $36.39 $35.29 $37.77
Royalties ($10.11) ($8.82) ($9.02) ($12.39) ($4.99) ($5.24) ($4.94) ($5.29)
Operating ($7.89) ($9.56) ($11.64) ($13.89) ($12.11) ($10.50) ($9.00) ($9.00)
Transportation $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Operating Netback $35.17 $29.42 $28.61 $38.86 $17.80 $20.66 $21.35 $23.48
Hedge Gain/(Loss) ($1.90) $0.61 $1.70 ($2.32) $8.80 $5.12 $2.59 $0.00
General & Administration ($0.74) ($1.58) ($1.96) ($1.90) ($2.99) ($2.79) ($2.55) ($2.65)
Interest ($3.22) ($3.64) ($3.82) ($4.01) ($3.64) ($3.22) ($2.66) ($2.23)
Cash Taxes ($0.30) ($0.17) ($0.13) ($0.21) ($0.13) ($0.15) ($0.14) ($0.14)
Other Cash Items ($0.48) ($0.55) ($0.23) ($0.62) ($0.14) ($0.13) $0.00 $0.00
Cash Netback $28.53 $24.08 $24.16 $29.79 $19.70 $19.49 $18.59 $18.46
Cash Costs (Ex. Hedging) ($22.75) ($24.33) ($26.81) ($33.03) ($24.00) ($22.02) ($19.29) ($19.31)
Cash Flow ($mm)
Gross Revenue $391 $414 $539 $769 $343 $320 $356 $400
Royalties ($74) ($76) ($99) ($146) ($49) ($46) ($50) ($56)
Operating ($58) ($83) ($127) ($164) ($119) ($92) ($91) ($95)
Transportation $0 $0 $0 $0 $0 $0 $0 $0
Hedge Gain/(Loss) ($14) $5 $19 ($27) $86 $45 $26 $0
General & Administration ($5) ($14) ($21) ($22) ($29) ($25) ($26) ($28)
Interest ($24) ($32) ($42) ($47) ($36) ($28) ($27) ($24)
Cash Taxes ($2) ($2) ($1) ($2) ($1) ($1) ($1) ($2)
Other Cash Items ($4) ($5) ($3) ($7) ($1) ($1) $0 $0
Cash Flow ($mm) $210 $209 $264 $352 $194 $171 $187 $195
Cash Flow Sensitivity (%)
US$10.00/bbl ∆ WTI - - - - - - 6% 9%
C$1.00/mcf ∆ AECO - - - - - - 16% 22%
Hedging (%)
% Liquids Hedged - - - - - 28% 29% 0%
% Gas Hedged - - - - - 47% 24% 0%
% Hedged - - - - - 41% 25% 0%
Capex & Dividend ($mm)
E&D Capex ($103) ($159) ($149) ($256) ($171) ($214) ($140) ($175)
Net Acquisitions $3 $8 ($37) ($7) $245 $69 $0 $0
Total Capex ($100) ($151) ($186) ($262) $74 ($145) ($140) ($175)
Dividend $0 $0 $0 $0 $0 $0 $0 $0
DRIP Savings $0 $0 $0 $0 $0 $0 $0 $0
Free Cash Flow (Financing Requirement) $109 $58 $78 $90 $268 $27 $47 $20
Tax Pools $0 $1,184 $1,704 $1,815 $1,133 - - -
Payout Ratio
E&D Capex/CF 49% 76% 56% 73% 88% 125% 75% 90%
Dividend/CF 0% 0% 0% 0% 0% 0% 0% 0%
(Capex+DPS-DRIP)/CF 49% 76% 56% 73% 88% 125% 75% 90%
Debt ($mm)
Bank Debt $252 $411 $547 $587 $248 $329 $344 $382
Working Capital Deficit $32 $43 $28 $158 ($7) $20 $18 $20
Convertibles & Notes $126 $171 $212 $129 $261 $133 $73 $12
Net Debt $410 $624 $788 $875 $502 $483 $435 $415
Net Debt/Cash Flow 2.0x 3.0x 3.0x 2.5x 2.6x 2.8x 2.3x 2.1x
Credit Facility $355 $600 $710 $710 $525 $525 $525 $525
% Drawn 71% 68% 77% 83% 47% 63% 66% 73%
Commodity Price Assumptions
WTI Crude Oil (US$/bbl) $56.47 $66.07 $72.23 $99.92 $61.97 $79.50 $85.00 $85.00
Henry Hub Natural Gas (US$/mmbtu) $8.91 $6.73 $6.97 $8.89 $4.16 $4.36 $4.50 $5.25
AECO Natural Gas (Cdn$/mcf) $8.65 $6.38 $6.46 $8.20 $4.00 $3.99 $3.90 $4.65
Foreign Exchange (US$/Cdn$) $0.83 $0.88 $0.93 $0.94 $0.88 $0.97 $0.99 $0.98
January 11, 2011
10 of 86
Energy Producers - Internationals Jamie Somerville Wael Halaoui (Associate)

Recommendation: BUY↑
Prior: HOLD
Risk: HIGH
Prior:
C$0.75↑
C$0.70
Alange Energy Corp.
(ALE-V) C$0.50
Market Data (C$)
Current Price $0.50
Upgrading to BUY
52-Wk Range $0.29-$0.80
Mkt Cap (basic)($mm) $374.0
We are making several adjustments to our short-term and long-term
EV ($mm) $409.6
Dividend per Share -- commodity price assumptions. The most important change for the
Dividend Yield -- International E&Ps is that we have increased our long-term crude oil outlook
Avg. Daily Trading Vol. (3mths) 4,844,222 to a flat US$85/bbl from 2011E forward (from US$80/bbl previously), which
Financial Data (C$) reflects a 6.3% increase. For complete details, please refer to our full length
Fiscal Y-E December
Industry Bulletin to be published later today.
Shares O/S (basic)(mm) 747.9
Float Shares (mm) 735.0 Reflecting this commodity update, we have increased our target price for
Net Debt ($mm) $35.6
Alange Energy Corp. (ALE-V) to C$0.75 (from C$0.70) due to an increase in
Net Debt/Tot Cap 12.9%
our NAVPS estimates. As a result, Alange now implies a 50% total return to
Estimates (US$) our target and we are upgrading Alange to BUY (from Hold).
Year 2009A 2010E 2011E 2012E
CFPS (f.d.) (0.03) 0.02 0.10 0.14
CFPS (f.d.)(old) (0.03) 0.02 0.10 0.14 Impact
Oil (b/d) 1,203 2,509 4,978 6,824 Neutral. We are not materially adjusting any of our estimates other than for
Gas (MMcf/d) 0 2.5 6.2 10.2 new commodity price assumptions. However, we are upgrading our
MBOE/d 1.2 2.9 6.0 8.5 recommendation to BUY (from Hold) due to a higher implied return to target
Valuations caused by a combination of a higher target price (driven by increased oil price
Year 2009A 2010E 2011E 2012E assumptions) and recent share price weakness.
EV/DACF nmf 29.3x 5.2x 3.1x
Supplemental Data (US$) Details and Outlook
Year 2009A 2010E 2011E 2012E
Exhibit 1 summarizes changes to our key estimates. The increase in our CFPS
WTI (US$/bbl) $61.85 $79.45 $85.00 $85.00
Base NAVPS -- C$0.22 -- --
and NAVPS estimates is due to the increase in our long term crude oil price
Risked NAVPS -- C$0.81 -- -- assumption.
The key news we are waiting for from Alange Energy is an update on its
All figures in US$, unless otherwise specified.
ongoing multi-well exploration program on the Topoyaco block in southern
Colombia’s Putumayo Basin. We also expect the company will provide
regular updates on plans to grow production from its development assets in
Colombia.
ALE-V: Price
Alange was incorporated as a private 45 45
company in January 2008, after which it
40 40
acquired interests in five blocks in Colombia.
The company began trading on the TSX-V 35 35
following a reverse takeover in July 2009 30 30

Please see the final pages of and subsequently expanded its acreage 25 25
this document for important position in Colombia through a series of
20 20
disclosure information. transactions. 2008 2009 2010
January 11, 2011
11 of 86
Exhibit 1. Alange: TD Newcrest Estimate Changes
2010E 2011E
New Old % Chg New Old % Chg
Production (BOE/d) 2,920 2,920 - 6,013 6,013 -

% Natural Gas 14% 14% - 19% 19% -
Financial ($mm)
Cash Flow $14 $12 18% $76 $71 8%
Capex $65 $65 - $63 $63 -
Ending Net Cash / (Debt) ($50) ($53) (4%) ($37) ($45) (17%)
CFPS - f.d. $0.02 $0.02 18% $0.10 $0.09 7%
Netbacks ($/BOE)
Revenue $59.46 $57.25 4% $69.76 $65.80 6%
Royalties ($6.00) ($5.78) 4% ($7.03) ($6.64) 6%
% Revenue 10% 10% 0% 10% 10% (0%)
Opex ($17.31) ($17.31) - ($19.40) ($19.40) -
Operating Netback $36.15 $34.16 6% $43.32 $39.75 9%
Base NAVPS C$0.22 C$0.19 13%

Fully-risked NAVPS C$0.81 C$0.74 10%
Source: TD Newcrest.
Valuation
Based on most recent prices, Alange trades at 3.1x 2012E EV/DACF, which is a significant 38% discount to
its closest peers. Additionally, at 0.60x Fully-risked NAVPS, it is also at a 21% discount to its closest peers.
Exhibit 2. Alange: Relative Valuation
Fully-risked NAVPS Base NAVPS 2012E EV/DACF

Recent At Price At Price At Price
Price Current Target Current Target Current Target
Ticker 10-Jan-11 Estimate Multiple Multiple Estimate Multiple Multiple Multiple Multiple
BNK $8.28 $12.04 0.69x 0.96x $6.33 1.31x 1.82x 7.6x 10.9x
BKX $4.06 $5.31 0.76x 0.94x $1.84 2.20x 2.71x 15.7x 19.0x
CNE $1.54 $2.16 0.71x 0.93x $0.43 3.58x 4.65x 5.3x 7.9x
CZE $11.92 $17.50 0.68x 0.91x $4.60 2.59x 3.48x 3.5x 5.3x
GTE $8.13 $9.75 0.83x 0.97x $3.26 2.49x 2.91x 4.9x 6.0x
NKO $94.75 $166.57 0.57x 0.84x $23.04 4.11x 6.08x 10.8x 15.7x
PDQ $0.68 $1.36 0.50x 0.85x $0.02 nmf 61.06x 7.4x 14.3x
PRE $31.47 $38.83 0.81x 0.98x $18.48 1.70x 2.06x 4.1x 5.3x
PXT $9.33 $9.02 1.03x 1.00x $1.60 nmf 5.63x 4.0x 3.9x
PMG $35.47 $40.61 0.87x 1.03x $18.31 1.94x 2.29x 3.3x 5.0x
TNP $3.22 $4.86 0.66x 0.93x $2.40 1.34x 1.87x 7.5x 10.7x
Average 0.74x 0.94x 2.36x 8.60x 6.7x 9.5x

Closest comparables (bold) 0.75x 0.93x 2.89x 15.55x 5.0x 7.5x
ALE $0.49 $0.81 0.60x 0.92x $0.22 2.22x 3.44x 3.1x 5.1x
Fiscal 2012 used as equivalent to calendar 2011 for CNE and NKO

We have increased our target price to C$0.75 (from C$0.70) due to the increase in our NAVPS estimates. Our
target price is based on multiples of 1.0x Base NAVPS and 0.9x Upside to Base NAVPS. The reasons for a
lower multiple relative to some of Alange’s peers include a relatively high gas weighting, and an expectation
that the company will miss its near-term production targets, which could increase market perceptions of
financing risk. We currently use a range of 0.85-1.05x in terms of our multiples of Upside to Base NAVPS.
January 11, 2011
12 of 86
Exhibit 3. Alange: Target Price Calculation
Base NAVPS $0.22

Multiple 1.00x
Target contribution $0.22
Fully-risked NAVPS $0.81
Upside to Base NAVPS $0.60
Multiple 0.90x
Calculated target price $0.75
Actual target price (rounded) $0.75

royalties, taxes, exchange rates, interest rates, environmental and weather concerns.
The key near-term risks specific to Alange are:

• Gas market and infrastructure risk is significant since ~80% of the company’s P+P gas reserves are
undeveloped gas and NGLs.
• Higher than average security risk in the Putumayo and Catatumbo basins.
• Higher than average geo-political risk.
We are increasing our target price for Alange Energy to $0.75 (from $0.70) due to an increase in our WTI oil
price assumptions for 2011 and beyond to US$85/bbl (from US$80/bbl). Following recent share price
weakness, our increased target price now implies a 50% return to target, and we are therefore upgrading our
recommendation for Alange Energy to BUY (from Hold).
The key news we are waiting for from Alange Energy is an update on its ongoing multi-well exploration
program on the Topoyaco block in southern Colombia’s Putumayo Basin. We also expect the company will
provide regular updates on plans to grow production from its development assets in Colombia.
January 11, 2011
13 of 86
Exhibit 4. Alange: Summary
Alange Energy Corp. ALE TSX-V Rating BUY
Price C$0.49 Risk HIGH

Target C$0.75
Basic O/S (mm) 747.9
f.d. O/S (mm) 786.6 Total Return to Target 55%
Market Cap. ($mm) $366.3 Fiscal Year-end 31-Dec
Net debt ($mm) $36.0 Last reported quarter Q3/10
Enterprise Value ($mm) $402.3 Reporting Currency : All dollar amounts in US$ unless otherwise noted
NET ASSET VALUE (2011E) Post-tax PV PRODUCTION (BOEPD)* 2009 2010E 2011E 2012E
Risked Colombia 1,203 2,920 6,013 8,530
% Int. COS mmBOE $mm C$/sh
Colombia P+P n/a 100% 15.8 $199.8 $0.25
Total 1,203 2,920 6,013 8,530

of which gas (%) 0% 14% 19% 24%
Total P+P Reserves 15.8 $199.8 $0.25 * includes risked resources and exploration potential
Net cash/(debt) -$37.1 -$0.05 FINANCIAL SUMMARY 2009 2010E 2011E 2012E
Discounted proceeds from in-the-money options $10.3 $0.01 Cash Flow ($mm) ($10.6) $13.8 $76.2 $107.4
Other long-term investments $0.0 $0.00 CFPS - Basic ($0.03) $0.02 $0.10 $0.14
Base NAV 15.8 $173.1 $0.22 CFPS - f.d. ($0.03) $0.02 $0.10 $0.14
P / Base NAVPS 2.22 Net Income ($mm) ($13.9) ($24.6) $10.3 $13.8
EPS - Basic ($0.04) ($0.03) $0.01 $0.02
Colombia Resource n/a 27% 34.3 $472.8 $0.60 EPS - f.d. ($0.04) ($0.03) $0.01 $0.02
Revenue* ($/BOE) $59.12 $53.48 $62.87 $60.62
Operating Costs ($/BOE) $15.09 $17.31 $19.40 $18.62
Operating Netback ($/BOE) $44.03 $36.17 $43.46 $42.00
* net of royalties and hedging
Total Upside Resource 34.3 $472.8 $0.60 CAPITAL STRUCTURE 2009 2010E 2011E 2012E
Discounted proceeds from exercise-below-target options $0.1 $0.00 Wtd. Avg. Basic Shares (mm) 360.7 747.3 747.9 747.9
Wtd. Avg. f.d. Shares (mm) 360.7 747.3 781.4 780.1
Fully Risked NAV 50.2 $646.0 $0.81 Market Cap. ($mm) $176 $388 $366 $366
P / Fully Risked NAVPS 0.60 Net Debt ($mm) ($4) $50 $37 ($22)
Enterprise Value ($mm) $172 $438 $403 $344
Unrisked Upside Resource 126.5 $1,357.2 $1.71 Capex ($mm) $58 $65 $63 $48
Discounted unused proceeds from Options $0.0 $0.00 Net Debt to Cash Flow 0.4 3.7 0.5 (0.2)
Unrisked NAV 142.3 $1,530.4 $1.93
P / Unrisked NAVPS 0.25
AREAS OF OPERATION VALUATION METRICS 2009 2010E 2011E 2012E
P/CF - f.d. nmf 26.5 5.0 3.6
P/E - f.d. nmf (14.9) 37.1 27.8
EV/DACF nmf 29.3 5.2 3.1
EV/BOEPD $143,136 $150,033 $67,094 $40,314
RESERVES 2009 2010 Proforma

Proved* (mmBOE) 8.5 nmf 8.5
P+P* (mmBOE) 31.7 nmf 31.7
Colombia FD&A Costs, P+P ($/BOE) nmf nmf
EV/BOE (Proved, $/BOE) $47.43
EV/BOE (P+P, $/BOE) $12.71
*Evaluated by Petrotech Engineering Ltd.
ASSUMPTIONS 2009 2010E 2011E 2012E

Brent (US$/bbl) $61.96 $79.73 $85.50 $85.50
WTI (US$/bbl) $61.85 $79.45 $85.00 $85.00
Mature Growth Exploration Discount rate (nominal) 10.0%
Spot FX rate (US$/C$) 1.0100
RECENT FINANCINGS INSIDER OWNERSHIP BASIC f.d.

Price # of Shares Proceeds Management 0% 1%
Date (C$) (mm) (C$mm) Management & Directors 2% 3%
7/7/09 $0.35 400.0 $140.00
Source: Company Reports, Bloomberg, TD Newcrest.

January 11, 2011
14 of 86
Energy Producers - Internationals Jamie Somerville Wael Halaoui (Associate)

Prior: HOLD
Risk: HIGH
Prior:
C$2.00↑
C$1.80
Canacol Energy Ltd.
(CNE-V) C$1.54
Market Data (C$)
Current Price $1.54
Upgrading to BUY
52-Wk Range $0.51-$1.87
Mkt Cap (basic)($mm) $675.6
We are making several adjustments to our short-term and long-term
EV ($mm) $625.6
Dividend per Share -- commodity price assumptions. The most important change for the
Dividend Yield -- International E&Ps is that we have increased our long-term crude oil outlook
Avg. Daily Trading Vol. (3mths) 2,816,634 to a flat US$85/bbl from 2011E forward (from US$80/bbl previously), which
Financial Data (C$) reflects a 6.3% increase. For complete details, please refer to our full length
Fiscal Y-E June
Industry Bulletin to be published later today.
Shares O/S (basic)(mm) 438.7
Float Shares (mm) 415.7 Reflecting this commodity update, we have increased our target price for
Net Debt ($mm) ($49.9)
Canacol Energy Ltd. (CNE-V) to C$2.00 (from C$1.80) due to an increase in
Net Debt/Tot Cap nmf
our NAVPS estimates. As a result, Canacol now implies a 30% total return to
Estimates (US$) our target and we are upgrading Canacol to BUY (from Hold).
Year 2009A 2010A 2011E 2012E
CFPS (f.d.) (0.03) (0.01) 0.16 0.22
CFPS (f.d.)(old) (0.03) (0.01) 0.16 0.21 Impact
Oil (b/d) 1,579 2,323 7,501 9,903 Neutral. We are not materially adjusting any of our estimates other than for
Gas (MMcf/d) 27 0 0 0 new commodity price assumptions. However, we are upgrading our
MBOE/d 1.6 2.3 7.5 9.9 recommendation to BUY (from Hold) due to a higher implied return to target
Valuations caused by a combination of a higher target price (driven by increased oil price
Year 2009A 2010A 2011E 2012E assumptions) and recent share price weakness.
EV/DACF nmf nmf 8.4x 5.5x
Supplemental Data (US$) Details and Outlook
Year 2009A 2010E 2011E 2012E
Exhibit 1 summarizes changes to our key estimates. The increase in our
WTI (US$/bbl) $70.03 $75.14 $82.79 $85.00
Base NAVPS -- -- C$0.43 --
NAVPS estimates is due to the increase in our long term crude oil
Risked NAVPS -- -- C$2.16 -- assumption.
As published on December 8 in our TD International E&P 2011 Preview, we

view Canacol as having the largest upside potential to our Fully-risked
NAVPS in our coverage from events we anticipate will occur in calendar
2011, largely due to near-term high impact exploration drilling in Guyana, to
be followed by first drilling on the company’s heavy oil acreage in H2/11.
CNE-V: Price
Company Profile 1.5 1.5
Canacol was initially incorporated as a
private company in early 2008 wtih assets in
1.0 1.0
Colombia and Guyana. Through a reverse
take-over of BrazAlta Resources in October
2008, the company acquired its listing on the 0.5 0.5
Please see the final pages of TSX-V and added Brazilian asets to its
this document for important portfolio. Following the transaction, the
0.0 0.0
disclosure information. company expanded its position in Colombia. 2008 2009 2010
January 11, 2011
15 of 86
Exhibit 1. Canacol: TD Newcrest Estimate Changes
Fiscal 2011E Fiscal 2012E

New Old % Chg New Old % Chg
Production (BOE/d) 4,520 4,939 (8%) 6,563 6,593 (0%)

% Natural Gas 0% 0% nmf 0% 0% nmf
Financial ($mm)
Cash Flow $72 $76 (5%) $109 $103 6%
Capex $87 $87 - $85 $85 -
Ending Net Cash / (Debt) $36 $40 (10%) $61 $60 3%
CFPS - f.d. $0.15 $0.16 (5%) $0.22 $0.21 5%
Netbacks ($/BOE)
Revenue $53.76 $51.76 4% $59.63 $57.13 4%
Royalties ($6.14) ($5.96) 3% ($5.69) ($5.42) 5%
% Revenue 11% 12% (1%) 10% 9% 1%
Opex ($18.43) ($18.35) 0% ($18.06) ($18.00) 0%
Transportation $0.00 $0.00 nmf $0.00 $0.00 nmf
Operating Netback $29.18 $27.45 6% $35.88 $33.71 6%
Base NAVPS C$0.43 $0.41 4%

Fully-risked NAVPS C$2.16 $1.97 9%
Valuation
Canacol is currently trading at 8.1x 2012E EV/DACF (a 45% premium to the average of other small- and mid-
cap producing Colombia-focused E&Ps in our coverage), 0.71x Fully-risked NAVPS (an 7% discount) and
3.58x Base NAVPS (a 52% premium).
Exhibit 2. Canacol: Relative Valuation
Fully-risked NAVPS Base NAVPS 2012E EV/DACF

Recent At Price At Price At Price
Price Current Target Current Target Current Target
Ticker 10-Jan-11 Estimate Multiple Multiple Estimate Multiple Multiple Multiple Multiple
ALE $0.49 $0.81 0.60x 0.92x $0.22 2.22x 3.44x 3.1x 5.1x
BNK $8.28 $12.04 0.69x 0.96x $6.33 1.31x 1.82x 7.6x 10.9x
BKX $4.06 $5.31 0.76x 0.94x $1.84 2.20x 2.71x 15.7x 19.0x
CZE $11.92 $15.80 0.75x 1.01x $4.26 2.80x 3.76x 3.5x 5.3x
GTE $8.13 $9.75 0.83x 0.97x $3.26 2.49x 2.91x 4.9x 6.0x
NKO $94.75 $166.57 0.57x 0.84x $23.04 4.11x 6.08x 10.8x 15.8x
PDQ $0.68 $1.36 0.50x 0.85x $0.02 nmf 61.06x 7.4x 14.4x
PRE $31.47 $38.83 0.81x 0.98x $18.48 1.70x 2.06x 4.1x 5.3x
PXT $9.33 $9.02 1.03x 1.00x $1.60 nmf 5.63x 4.0x 3.9x
PMG $35.47 $40.61 0.87x 1.03x $18.31 1.94x 2.29x 3.3x 5.0x
TNP $3.22 $4.86 0.66x 0.93x $2.40 1.34x 1.87x 7.5x 10.7x
Average 0.74x 0.95x 2.24x 8.51x 6.5x 9.2x

Closest comparables (bold) 0.76x 0.99x 2.36x 3.10x 3.7x 5.3x
CNE $1.54 $2.16 0.71x 0.93x $0.43 3.58x 4.65x 5.3x 7.9x
Fiscal 2013 used as equivalent to calendar 2012 for CNE and NKO

We are increasing our target price for Canacol to C$2.00 from C$1.80 due to increase in our NAVPS
estimates. Our target price for Canacol is based on a combination of Base and Fully risked NAVPS. The
January 11, 2011
16 of 86
combination of 1.0x Base NAVPS and 0.9x Upside to Base NAVPS is close to the highest multiples used for
our coverage of International E&Ps (we currently use a range of 0.85x to 1.05x in terms of our multiples of
Upside to Base NAVPS).
Exhibit 3. Canacol: Target Price Calculation
Base NAVPS $0.43

Multiple 1.00x
Fully-risked NAVPS $2.16
Upside to Base NAVPS $1.73
Multiple 0.90x
Calculated target price $1.99
Actual target price (rounded) $2.00

The key near-term risks specific to Canacol are:

• A significant portion of our valuation is based on exploration potential.
• Financing risk is significant for Canacol.
• Higher than average security risk in the Putumayo Basin.
We are increasing our target price for Canacol to C$2.00 (from C$1.80) due to an increase in our WTI oil price
assumptions for 2011 and beyond to US$85/bbl (from US$80/bbl). Following recent share price weakness, our
increased target price now implies a 30% return to target, and we are therefore upgrading our recommendation
for Canacol to BUY (from Hold).
As published on December 8 in our TD International E&P 2011 Preview, we view Canacol as having the
largest upside potential to our Fully-risked NAVPS in our coverage from events we anticipate will occur in
calendar 2011, largely due to near-term high impact exploration drilling in Guyana, to be followed by first
drilling on the company’s heavy oil acreage in H2/11.
January 11, 2011
17 of 86
Exhibit 4. Canacol Energy: Summary
Canacol Energy Ltd. CNE TSX-V Rating BUY
Price C$1.54 Risk HIGH

Target C$2.00
Basic S/O (mm) 438.7
f.d. S/O (mm) 480.3 Total Return to Target 30%
Market Cap. ($mm) $682.4 Fiscal Year-end 30-Jun
Net debt ($mm) ($50.4) Last reported quarter Fiscal Q1/11
Enterprise Value ($mm) $632.0 Reporting Currency : All dollar amounts in US$ unless otherwise noted
NET ASSET VALUE (F2012E) Post-tax PV PRODUCTION (BOEPD)* FY2010 FY2011E FY2012E FY2013E
Risked C$/ Colombia 762 4,184 5,663 5,499
% Int. COS mmBOE $mm share Brazil 129 156 260 292
Colombia P+P n/a 100% 8.3 $123.7 $0.24 Canada 0 0 0 0
Brazil P+P n/a 100% 0.6 $14.3 $0.03 Guyana 0 180 640 1,231
Guyana P+P n/a 100% - $0.0 $0.00 Colombia Tariff 1,432 2,982 3,340 2,530
Total 2,323 7,501 9,903 9,552
of which gas (%) 0% 0% 0% 0%
Total P+P Reserves 9.0 $138.0 $0.26 * includes risked resources and exploration potential
Net cash/(debt) $61.3 $0.12 FINANCIAL SUMMARY FY2010 FY2011E FY2012E FY2013E
Discounted proceeds from in-the-money options $27.1 $0.05 Cash Flow ($mm) ($3.7) $71.6 $109.1 $114.5
Other long-term investments $0.0 $0.00 CFPS - Basic ($0.01) $0.16 $0.25 $0.26
Base NAV 9.0 $226.5 $0.43 CFPS - f.d. ($0.01) $0.15 $0.22 $0.23
P / Base NAVPS 3.58 Net Income ($mm) ($21.6) $13.5 $34.8 $41.8
EPS - Basic ($0.07) $0.03 $0.08 $0.10
Colombia Resource n/a 15% 92.9 $556.4 $1.06 EPS - f.d. ($0.07) $0.03 $0.07 $0.09
Brazil Resource n/a 30% 0.7 $12.6 $0.02 Revenue* ($/BOE) $26.94 $50.06 $55.86 $59.36
Guyana Resource n/a 24% 22.1 $341.1 $0.65 Operating Costs ($/BOE) $19.07 $18.43 $18.06 $17.73
Operating Netback ($/BOE) $7.87 $31.62 $37.80 $41.63
* net of royalties and hedging
Total Upside Resource 115.6 $910.1 $1.73 CAPITAL STRUCTURE FY2010 FY2011E FY2012E FY2013E
Discounted proceeds from exercise-below-target options $0.0 $0.00 Wtd. Avg. Basic Shares (mm) 299.8 436.7 440.4 440.4
Debt reduction through assumed bond conversion $0.0 $0.00 Wtd. Avg. f.d. Shares (mm) 299.8 475.8 490.5 489.9
Fully Risked NAV 124.6 $1,136.6 $2.16 Market Cap. ($mm) $316 $679 $685 $678
P / Fully Risked NAVPS 0.71 Net Debt ($mm) ($33) ($36) ($61) ($55)
Enterprise Value ($mm) $283 $643 $624 $623
Unrisked Upside Resource 724.4 $4,691.3 $8.91 Capex ($mm) $25 $87 $85 $120
Discounted unused proceeds from Options $0.0 $0.00 Net Debt to Cash Flow 8.9 (0.5) (0.6) (0.5)
Unrisked NAV 733.4 $4,917.8 $9.34
P / Unrisked NAVPS 0.16
AREAS OF OPERATION VALUATION METRICS FY2010 FY2011E FY2012E FY2013E
P/CF - f.d. nmf 10.3 7.0 6.7
P/E - f.d. nmf 54.6 21.9 18.2
EV/DACF nmf 8.4 5.5 5.3
EV/BOEPD $317,834 $142,247 $95,023 $88,677
Guyana RESERVES FY2010 F2011 Proforma

Proved* (mmBOE) 6.7 nmf 6.7
P+P* (mmBOE) 12.7 nmf 12.7
Colombia FD&A Costs, P+P ($/BOE) $14.68 nmf
Brazil EV/BOE (Proved, $/BOE) $93.64
EV/BOE (P+P, $/BOE) $49.59
* Evaluated by Ryder Scott, Netherland Sewell and DeGolyer & MacNaughton
ASSUMPTIONS FY2010 FY2011E FY2012E FY2013E
Brent (US$/bbl) $74.65 $83.57 $85.50 $85.50
WTI (US$/bbl) $75.14 $82.79 $85.00 $85.00
Mature Growth Exploration Discount rate (nominal) 10%
Spot FX rate (US$/C$) 1.0100
RECENT FINANCINGS INSIDER OWNERSHIP BASIC f.d.

Price # of Shares Proceeds Management 1% 3%
Date ($) (mm) ($mm) Management & Directors 2% 5%
10/15/09 $0.28 142.9 $40.00
5/13/10 $0.75 76.7 $57.50
7/16/10 * * $41.50
* 8.00% convertible unsecured debentures convertible at $1.0526 per share
Source: Company Reports, Bloomberg, Canacol Energy

January 11, 2011
18 of 86

Prior: BUY
Risk: HIGH
Prior:
C$45.00↓
C$46.00
Crescent Point Energy Corp.
(CPG-T) C$42.38
Market Data (C$) NAV Update Results in Slight Target Reduction, Rating
52-Wk Range $35.30-$45.60 Lowered
Mkt Cap (f.d.)($mm) $11,506.2
Event
Dividend Yield 6.5%
Avg. Daily Trading Vol. (3mths) 966777 TD is now basing target prices on YE-2010E reserves and 2012E DACF
Financial Data (C$)
Shares O/S (f.d.)(mm) 271.5 Negative
Net Debt ($mm) $1,060.0
Entering 2011 we are i) updating our commodity price forecast; ii)
Estimates (C$)
Year 2009A 2010E 2011E 2012E
introducing 2012 estimates; iii) estimating year end 2010 reserves and using
CFPS (f.d.) 4.14 3.90 4.22 4.45 this updated reserve estimate in our Net Asset Value analysis (both
CFPS (f.d.)(old) -- 3.94 4.07 -- Blowdown and Modified Growth).
Debt/CF 0.9x 1.1x 0.9x 0.7x
Oil (b/d) 39,749 55,373 64,839 68,259
Outlook
Gas (MMcf/d) 30.8 38.8 42.1 47.9
MBOE/d 44.9 61.8 71.8 76.2
Although WTI crude oil prices recently tested levels above US$90/bbl, we are
taking a somewhat conservative view on prices and are estimating a WTI
Valuations price of US$85/bbl through 2011 and 2012. In our view, fundamentals for the
Year 2009A 2010E 2011E 2012E
EV/DACF 10.3x 12.6x 10.7x 10.3x
Yield 9.0% 7.0% 7.0% 7.0% do not support current prices.
P/NAV -- 109.0% -- --
Supplemental Data Looking at natural gas, above-average withdrawals have somewhat reduced
Year 2009A 2010E 2011E 2012E the overhang in inventories; however, seasonal gas inventory levels remain
WTI (U$/bbl) $61.97 $79.50 $85.00 $85.00 near record highs due to ample supply. Given the continued oversupply of the
NYMEX (U$/mcf) $4.16 $4.36 $4.50 $5.25
AECO (C$) $4.00 $3.99 $3.90 $4.65
F/X (US$) $0.88 $0.97 $0.99 $0.98 (previously $5.75) in 2011 and US$5.25/mcf in 2012. Our new commodity
In spite of the higher crude oil price incorporated into our NAV and cash
flow models, our NAV estimate has declined modestly on higher expected
cash costs in 2011. The reduced NAV, combined with a slightly lower
subjective factor of 8/10 (previously 9/10) results in a revised target price
of $45.00 (previously $46.00). Given the lower target price and positive
share price performance since our last published note, we are reducing
our rating to HOLD (from Buy).
CPG-T: Price
Crescent Point Energy Corp. is a 45 45
conventional oil and gas company with assets 40 40
strategically focused in properties comprised 35 35
of high quality, long life, operated, light oil 30 30
and natural gas reserves in western Canada.
Please see the final pages of Two core areas for CPG are the light oil
25 25
this document for important Bakken development in SE Sask and the

20 20
15 15
disclosure information. Lower Shaunavon development in SW Sask. 2008 2009 2010
January 11, 2011
19 of 86

2010A 2011E 2012E
WTI (US$/bbl) $79.50 $85.00 $80.00 $93.23 10% $85.00 $93.94 11%
Edmonton ($/bbl) $76.80 $83.50 $80.90 - - $84.60 - -
NYMEX (US$/mcf) $4.36 $4.50 $5.75 $4.56 1% $5.25 $5.08 -3%
AECO ($/mcf) $3.99 $3.90 $5.10 $3.99 2% $4.65 $4.49 -3%
FX (US$) $0.97 $0.99 $0.97 $1.00 1% $0.98 $0.99 1%
Valuation
CPG 154% 109% 10.7x 10.3x $178,918 $174,205 $36.49 0.9x 95% 7% 10%
Average 157% 101% 10.2x 8.8x $93,744 $90,489 $25.91 2.1x 122% 5% 53%
>60% Gas 154% 112% 11.9x 9.2x $76,205 $68,787 $23.48 3.0x 135% 2% 78%
>60% Oil 168% 100% 9.6x 9.2x $127,358 $127,682 $32.73 1.3x 110% 6% 26%
Yield 159% 98% 9.6x 8.6x $93,236 $92,893 $24.16 2.1x 118% 5% 49%
No Yield 148% 115% 13.0x 9.8x $95,901 $80,269 $33.37 2.1x 141% 0% 70%

Our target price reflects a base valuation of $39.03 that combines 1.0x our modified growth NAV of $38.85 at
a 65% weighting and $39.36 using an EV/DACF multiple of 9.6x 2011E DACF at a 35% weighting. This is
then adjusted by a subjective factor of +15% (within a range of +/- 25% for the sector).

Crescent Point is the dominant operator in the Saskatchewan Bakken and Lower Shaunavon light oil resource
plays. Combined, these plays represent over 8 billion barrels of OOIP. A recent acquisition provided Crescent
point with approximately 1 million acres of land in the very early stage of what is being described as the
Alberta Bakken (Exshaw) play. The company estimates it has greater than 6,000 future drilling locations,
representing ~20 years of development at its current drilling pace. For 2011, we anticipate that expanded
Bakken waterflood pilots will capture increased market focus and many will be looking for early results from
the Alberta Bakken play. A review of the first two pilots indicate that the waterflood is working in the Bakken.
At its Alberta Bakken play, three exploratory wells were drilled in 2010 (no results to date), and the company
plans to drill an additional 14 net wells in 2011.
Reserve growth has been strong for the company but production growth per share has lagged. Our analysis
shows that modest i.e. 3% production growth per share on a debt adjusted basis, is achievable in 2011 and
2012. While the company has only 40% drawn on its credit facility and will be spending or dividending out
less than cash flow in 2011 and 2012 in our forecasts, this is only because of the nearly 60% DRIP which
offsets the 60% payout and cash costs of supporting its 7% yield.
January 11, 2011
20 of 86
LAST TICKER TARGET RATING

CRESCENT POINT ENERGY CORP.
CPG $42.38 CPG $45.00 HOLD
CFPS (fd) $3.01 $2.96 $3.47 $4.68 $4.14 $3.90 $4.22 $4.45
DPS (Basic) $2.14 $2.40 $2.40 $2.61 $2.76 $2.76 $2.76 $2.76
NAVMG - - - - - $38.85 - -
Valuation
Share Price (Avg) $19.36 $20.76 $19.88 $29.51 $31.99 $42.38 $42.38 $42.38
Market Cap ($mm) $808 $1,444 $2,262 $3,692 $6,676 $11,341 $11,856 $12,436
Net Debt ($mm) $225 $258 $656 $956 $601 $1,060 $999 $846
Yield 11% 12% 12% 9% 9% 7% 7% 7%
P/NAV - - - - - 109% - -
P/CF 6.4x 7.0x 5.7x 6.3x 7.7x 10.9x 10.1x 9.5x
EV/DACF 9.0x 8.4x 7.8x 7.4x 10.3x 12.6x 10.7x 10.3x
EV/BOEPD $84,908 $82,091 $103,786 $124,278 $162,125 $200,545 $178,918 $174,205
EV/2PBOE (Pro Forma) $20.40 $18.37 $17.42 $24.34 $25.84 $36.49 - -
Production
Oil & NGLs (bbls/d) 9,197 17,418 24,349 32,583 39,749 55,373 64,839 68,259
Heavy Oil (bbls/d) - - - - - - - -
Gas (mmcf/d) 17.8 19.8 22.6 28.9 30.8 38.8 42.1 47.9
Total BOE/d (6:1) 12,164 20,723 28,117 37,396 44,883 61,836 71,851 76,245
Gas % 24% 16% 13% 13% 11% 10% 10% 10%
PDP 26.4 53.7 70.9 77.2 107.3 119.5 - -
Proved 34.7 65.6 115.7 132.1 185.7 222.5 - -
Proved + Probable 50.6 92.6 167.5 191.0 281.6 339.8 - -
% Proved 69% 71% 69% 69% 66% 65% - -
RLI (Proven) 6.9 8.4 9.5 9.2 9.8 - - -
RLI (P+P) 10.1 11.9 13.8 13.2 14.8 - - -
FD&A + FDC (Proven) $35.23 $19.82 $30.24 $26.78 $40.71 - - -
FD&A +FDC (P+P) $24.72 $16.03 $22.79 $22.34 $28.64 - - -
Growth
Production Growth
Absolute - 70% 36% 33% 20% 38% 16% 6%
Per Share - (3%) (15%) 8% (7%) (6%) 1% 1%
Per Share (Debt Adjusted) - (2%) (16%) 6% (2%) (3%) 3% 3%
P+P Reserve Growth
Absolute - 83% 81% 14% 47% - - -
Per Share - 10% 11% 4% (12%) - - -
Per Share (Debt Adjusted) - 11% (1%) (21%) 35% - - -
Netback ($/BOE)
Gross Revenue $56.55 $56.52 $63.55 $88.93 $60.71 $70.77 $73.29 $74.26
Royalties ($11.27) ($11.90) ($11.59) ($16.09) ($10.54) ($12.12) ($12.46) ($12.99)
Operating ($8.08) ($9.18) ($9.25) ($9.01) ($8.92) ($10.85) ($10.75) ($10.75)
Transportation ($1.04) ($1.35) ($1.73) ($1.87) ($1.48) ($1.63) ($1.60) ($1.60)
Hedge Gain/(Loss) ($7.42) ($4.01) ($0.96) ($11.29) $7.64 $0.50 ($0.11) $0.40
Interest ($1.22) ($1.81) ($2.12) ($2.45) ($2.14) ($2.71) ($1.71) ($0.79)
Cash Taxes ($1.24) ($1.50) ($1.50) ($1.46) ($0.98) ($1.19) ($1.16) ($1.16)
Other Cash Items ($0.33) ($0.29) ($0.41) ($1.81) ($1.10) ($0.07) $0.00 $0.00
Cash Netback $24.50 $24.87 $34.49 $43.35 $40.96 $40.98 $43.99 $45.77
Cash Flow ($mm)
Gross Revenue $251 $427 $652 $1,217 $995 $1,597 $1,922 $2,067
Royalties ($50) ($90) ($119) ($220) ($173) ($274) ($327) ($362)
Operating ($36) ($69) ($95) ($123) ($146) ($245) ($282) ($299)
Transportation ($5) ($10) ($18) ($26) ($24) ($37) ($42) ($45)
Hedge Gain/(Loss) ($33) ($30) ($10) ($155) $125 $11 ($3) $11
Interest ($5) ($14) ($22) ($33) ($35) ($61) ($45) ($22)
Cash Taxes ($6) ($11) ($15) ($20) ($16) ($27) ($30) ($32)
Other Cash Items ($1) ($2) ($4) ($25) ($18) ($2) $0 $0
Cash Flow ($mm) $109 $188 $354 $593 $671 $925 $1,154 $1,274
US$10.00/bbl ∆ WTI - - - - - - 11% 13%
C$1.00/mcf ∆ AECO - - - - - - 1% 1%
Hedging (%)
% Liquids Hedged - - - - - 44% 44% 24%
% Gas Hedged - - - - - 22% 17% 0%
% Hedged - - - - - 42% 41% 21%
E&D Capex ($38) ($143) ($236) ($467) ($358) ($925) ($800) ($850)
Net Acquisitions ($322) ($574) ($1,068) ($141) ($2,079) ($623) $0 $0
Total Capex ($360) ($718) ($1,304) ($608) ($2,436) ($1,547) ($800) ($850)
Dividend $0 $0 $0 $0 ($441) ($655) ($755) ($791)
DRIP Savings $0 $0 $0 $0 $211 $377 $462 $520
Free Cash Flow (Financing Requirement) ($252) ($529) ($950) ($14) ($1,995) ($900) $61 $153
Tax Pools $0 $578 $1,023 $1,534 $4,596 - - -
Payout Ratio
E&D Capex/CF 35% 76% 67% 79% 53% 100% 69% 67%
Dividend/CF 0% 0% 0% 0% 66% 71% 65% 62%
(Capex+DPS-DRIP)/CF 35% 76% 67% 79% 88% 130% 95% 88%
Debt ($mm)
Bank Debt $226 $254 $596 $919 $519 $646 $561 $400
Working Capital Deficit ($1) $3 $60 $37 $82 $97 $121 $128
Convertibles & Notes - - - - $0 $318 $318 $318
Net Debt $225 $258 $656 $956 $601 $1,060 $999 $846
Credit Facility $245 $350 $800 $1,150 $1,600 $1,600 $1,600 $1,600
% Drawn 92% 73% 74% 80% 32% 40% 35% 25%
January 11, 2011
21 of 86
Gold & Precious Minerals Steven Green, CFA Scott Parsons, CFA
Recommendation: BUY
Unchanged
Risk: HIGH
12-Month Target Price: C$21.00
Unchanged
Eldorado Gold Corp.
(ELD-T, EGO-A) C$16.90
Market Data (C$)
Long Term Outlook Points to Strong Organic Growth Prospects
52-Wk Range $12.02-$21.35
Eldorado provided a Q4 operational update, along with 2011 guidance. The
Dividend Yield 0.6%
Avg. Daily Trading Vol. (3mths) 2,662,498 company also announced an increase to its semi-annual dividend.
Financial Data (C$)
Shares O/S (f.d.)(mm) 551.7 NEUTRAL – Production in Q4 was slightly above our estimate, however
2011 guidance was below our expectations with lower production and higher
NAVPS (current)(f.d.) $11.49 costs. That being said, the company does have a track record of being
conservative with initial guidance numbers (guidance was increased twice in
Estimates (US$)
Year 2008A 2009A 2010E 2011E 2010).
EBITDA ($mm) 145.4 183.8 436.8 688.8
EPS (f.d.) 0.24 0.25 0.39 0.65 Also the company’s longer term growth plans include production of 1.5m
EPS (f.d.)(old) -- -- 0.40 0.73 oz targeted by 2015, well above our current forecasts, which currently max
CFPS (f.d.) 0.35 0.38 0.66 0.99
out at 1.27m ozs. The company plans on achieving this through an expansion
CFPS (f.d.)(old) -- -- 0.67 1.08
of existing operations, details of which will be released throughout 2011. The
EPS (f.d.) Quarterly Estimates (US$)
Year 2008A 2009A 2010E 2011E
first scheduled release is Kisladag with the plan to increase gold production to
Q1 0.06 0.03 0.09 -- 450,000/oz per year (up from approx. 300,000/yr currently).
Q2 0.07 0.07 0.11 --
Q3 0.05 0.07 0.09 -- The company also announced what amounts to a dividend increase with its
Q4 0.07 0.08 0.10 -- 2011 dividend to be based on approximately $100/oz of gold sold, taking the
Valuations yield to approximately 0.6%.
Year 2008A 2009A 2010E 2011E
P/EBITDA (f.d.) 64.6x 51.1x 21.5x 13.6x
P/E (f.d.) 70.9x 68.1x 43.6x 26.2x
Details
P/CFPS (f.d.) 48.6x 44.8x 25.8x 17.2x
Q4/10 Operational Results
• Production: 148,372 oz, slightly above our estimate of 145,715 oz and
largely in-line with Q3 production of 151,297 oz. A weaker quarter at
Jinfeng due to lower grades was offset by better than expected
production from TJS, and White Mountain.
• Cash costs: $418/oz, above our estimate of $381/oz and up from Q3
cash costs of $386/oz. Higher costs at Kisladag and Jinfeng, the latter
due to lower grades, appear to be the main contributors to the cost
increase.
ELD-T: Price
Eldorado Gold Corp. is a mid-tier gold
20 20
producer with four producing mines,
Kisladag in Turkey, and Tanjianshan, 15 15
Jinfeng, and White Mountain in China.
10 10
Eldorado also has development projects in
Please see the final pages of Turkey, China, and Greece. Eldorado is 5 5
this document for important expected to produce approximately 1.0
0 0
disclosure information. million ounces per year by 2013. 2008 2009 2010
January 11, 2011
22 of 86
Exhibit 1: Q4/10 Operational Results

Q4/09 Q1/10 Q2/10 Q3/10 Q4/10 Q4/10 Quarterly
Production (ozs) Actual Actual Actual Actual Actual TDN Estimate Difference Change
Kisladag 70,131 82,240 70,451 62,086 59,815 60,466 -1% -4%
Total Cash Costs (US$/oz) $298 $307 $345 $359 $379 - -
TJS 37,773 25,423 28,884 28,847 30,709 18,823 63% 6%
Jinfeng 14,541 45,615 52,659 46,116 37,560 50,886 -26% -19%
White Mountain 6,148 11,650 15,946 14,248 20,288 15,541 31% 42%
Total Production
Gold (oz) 128,593 164,928 167,940 151,297 148,372 145,715 2% -2%
Cash Costs (US$/oz) $329 $371 $357 $386 $418 $381 10% 8%
Total Cash Costs (US$/oz) $364 $398 $410 $431 - $427 - -
Source: Company reports, TDN estimates.
Dividend Increase Keeps Eldorado In-Line with Peers

• The company also announced a special dividend of $0.05/sh, doubling its 2010 dividend to $0.10/sh.
This is based roughly on $100/oz of gold sold in H2/10. Yield will go to approximately 0.6%.
• The company expects its 2011 semi-annual dividend will be based on roughly the same metric of $100/oz
sold. This would amount to a payout of approximately $74.3m per year or $0.13, which would imply a
yield of yield of 0.8% and put Eldorado in the middle of the pack in terms of its large cap peers.
• We estimate the company’s free cash flow generation of nearly $1.2b over the next three years can more
than support this increase.
Outlook
2011 Production Guidance - Below Expectations

• 2011 production guidance is 715,000 - 770,000 oz at cash costs of $375-$395/oz, below our previous
estimate of 791,255 oz at cash costs of $323/oz ($367/oz inc. royalties).
• This is also down from initial 2011 production guidance (from Feb 2010) of 790,000 - 860,000 oz at cash
costs of $315-325/oz, due primarily to the delay in permitting construction of Eastern Dragon, and start-
up of Efemcukuru disclosed last quarter. Also, it appears lower milled grades are expected to persist into
2011 at Jinfeng, reducing expected production at that operation.
• This represents a 13-21% increase over 2010 production, with the bulk expected from new production at
Efemcukuru (70-80k oz) and Eastern Dragon (20-25k oz).
• Despite the lower that expected guidance, the company does have a track record of meeting and
exceeding guidance over the past few years. 2010 production of 632,537 oz ended up well above initial
guidance of 550,000 - 600,000 oz. As a result, we are comfortable being near the high end of guidance
and are assuming 2011 production of 760,405 oz at cash costs of $381/oz ($429/oz inc. royalties).
CAPEX: $230m has been budgeted for 2011 with more than half allocated to bringing Efemcukuru and
Eastern Dragon on-line. This was above our estimate of $180m, with higher spending at the two new
operations the largest contributor.
January 11, 2011
23 of 86
Exhibit 2: 2011 Guidance

Initial Production Cash Operating CAPEX
Year Guidance (k oz) Actual/Guidance (k oz) Costs (US$/oz) US$mm
2008A 290-300 308.8 257
2009A 325-340 342.8 307
2010A 550-600 632.5 382
2011E 715-770 - 375-395 230
Exhibit 3: Initial Guidance vs Actual Production
1,500
1600
1400
760 (TD Est.)

1200
Production (000 oz)
1000 743
632.5
800
575
600
342.8
308.8
333
295
400
200
0
2008A 2009A 2010A 2011E 2012E 2013E 2014E 2015E
Initial Guidance (mid-point) Actual Production
Longer Term Target of 1.5m oz

• The company also provided a longer term production target of 1.5m oz annually by 2015 through
optimizations and expansions at its existing operations. This is well above our peak annual production
estimate of 1.27m oz, which still represents one of the strongest 5 year growth profiles amongst its large
cap peers.
• Details of the expansion plans are to be released through 2011 with the first study scheduled to be the
proposed Kisladag expansion to 450,000 oz per year. This would represent a 58-67% increase over 2011
guidance.
• In addition, the company believes Efemcukuru, White Mountain and Eastern Dragon are expandable.
January 11, 2011
24 of 86
Exhibit 4: P/NAV vs. 5 Year Production Growth
2.25
2.00 AEM
1.75
P/NAV
1.50 ELD
ABX GG
1.25
KGC
IMG AUY
1.00
0.75
0% 25% 50% 75% 100% 125%
Production Growth to 2015
Exhibit 5: Changes to Our Estimates

Gold Production (000 oz) Total Cash Costs (US$/oz)
2010E 2011E 2010E 2011E
New 633 760 $425 $429
Old 630 791 $416 $367
EPS (US$/sh) CFPS (US$/sh)

2010E 2011E 2010E 2011E NAV (C$/sh)
New $0.39 $0.65 $0.66 $0.99 $11.49
Old $0.40 $0.73 $0.67 $1.08 $11.56
Source: TDN estimates.
Valuation
We calculate a NAV for Eldorado of C$11.49 (down slightly from $11.56). Eldorado currently trades at a 1.5x
NAV multiple and 17x 2011 CFPS, slightly above its large cap producing peer average of 1.4x NAV and 13x
CFPS. We view Agnico-Eagle as Eldorado’s closest peer given the similar size and growth profiles. In our
view, Eldorado has higher political risk, but a significantly stronger balance sheet than Agnico. We believe the
current large valuation discount is unwarranted.
January 11, 2011
25 of 86
Exhibit 6: Gold Producers – P/NAV
2.25x
2.03x
2.00x
1.65x
1.75x
1.47x
1.44x
1.41x
1.38x
1.35x
1.50x
Avg Large Cap P/NAV - 1.4x
1.28x
1.17x
1.15x
Avg P/NAV - 1.2x
1.15x
1.11x
1.10x
1.25x
1.05x
Avg Jnr/Intermediate P/NAV - 1.1x
0.86x
0.86x
1.00x
0.61x
0.75x
0.50x
0.25x
0.00x
YRI
IMG
ABX
NGX
AEM
MFL
GAM
AGI
G
CG
LSG
JAG
NGD
ELD
SGR
P
Exhibit 7: Peer Valuation Summary

Share P/E P/CF
Company Price P/NAV 2010E 2011E 2010E 2011E
Barrick Gold Corp. $49.05 1.41 15.0 10.8 10.5 8.0
Goldcorp Inc. $42.91 1.44 34.1 25.2 18.3 14.6
Kinross Gold Corp. $17.36 1.17 27.1 19.3 12.7 11.3
Eldorado Gold Corp. C$16.90 1.47 43.6 26.2 25.8 17.2
Agnico-Eagle Mines Ltd. $71.66 2.03 39.4 28.5 19.9 16.9
Yamana Gold Inc. $11.89 1.15 20.2 12.9 12.4 8.9
IAMGOLD Corp. C$17.81 1.15 26.8 15.6 17.8 11.1
Average: 1.40 29.4 19.8 16.8 12.6

Our target price of $21.00 is based on a 1.8x multiple to our 5% NAV (weighted 60%) and an 18x multiple to
our blended 2011/2012 CFPS estimate (40% weighted). We value Eldorado at the upper/middle end of our
large-cap producer range of 1.5 to 2.0x NAV and 12-20x CFPS reflecting, in our view, its strong growth, high
quality assets and management team balanced by higher than average country risk in Turkey, China, and
Greece.

The main risks facing Eldorado include forecast, financial, technical and political risks. Among other things,
these include risks related to gold, iron ore and fuel prices, the governing fiscal and legislative regimes, the
timing of key developments, market conditions, capital and operating costs, foreign exchange rates, resources
and reserves, operating parameters, permitting, environmental, indigenous peoples, and staffing and key
personnel retention. Eldorado also faces risk due to ongoing court cases against Kisladag and Efemcukuru in
Turkey.
We are maintaining a BUY recommendation and $21.00 target price.
January 11, 2011
26 of 86
Exhibit 8: Eldorado Snapshot

Symbol ELD-T, EGO-N Target Price (C$): $21.00
Share Price (C$) $16.90 Return: 24.9%
Market Cap (C$mm) $9,324.1 Reserves (mm oz Au) 15.3
Stock Rating: BUY Total Resources (mm oz Au) 29.2
Company Profile:
Eldorado Gold Corp. is a mid-tier gold producer with four producing mines, Kisladag in Turkey, and Tanjianshan, Jinfeng, and White Mountain in China.
Eldorado also has development projects in Turkey, China, Brazil and Greece. Eldorado is expected to produce approximately 1.0 million ounces per year
by 2013.
Ratio Analysis 2007A 2008A 2009A 2010E 2011E 2007A 2008A 2009A 2010E 2011E
Net Income (US$mm) 31 166 102 217 361 Average share price (C$) 6.19 7.04 11.18 16.90 16.90
EPS (f.d.) (US$/sh) 0.12 0.24 0.25 0.39 0.65 S/O (fd mm) 349.2 357.7 391.7 545.4 551.7
P/E (x) 50.4 28.2 43.0 42.4 25.4 Average Gold price (US$/lb) $697 $873 $975 $1,226 $1,400
Operating CF bf. ch. in WC (US$mm 65 127 147 361 549 Total cash costs (US$/oz gold) $263 $289 $337 $425 $429
CFPS bf. ch. in WC (US$/sh) 0.20 0.35 0.38 0.66 0.99
P/CF (bf. ch. in WC) (x) 30.7 19.6 29.1 25.0 16.7 Mine Production (000 oz)
Dividend (C$/sh) - - - 0.10 0.10 Kisladag 135 190 237 275 285
Dividend yield 0.0% 0.0% 0.0% 0.6% 0.6% TJS Production 126 118 106 114 116
LTD/Total capitalization NA NA NA NA NA Efemçukuru - - - - 80
Jinfeng - - 15 182 184
Income Statement Items (US$mm) White Mountain - - 6 62 72
Total revenue 189 288 361 786 1,128 Eastern Mountain - - - - 24
Operating costs 73 92 132 279 351 Perama Hill - - - - -
Exploration 12 12 12 18 32 Total Production (000 oz) 269 309 364 633 760
SG&A 27 38 33 52 56
Depreciation 20 26 39 107 132 Quarterly Mine Production (000 oz) Q1/10A Q2/10A Q3/10A Q4/10E
Interest expense 3 3 1 8 6 Total Production (000 oz) 165 168 151 148
Other 1 (67) (3) (3) (2) Total cash costs (US$/oz gold) $398 $410 $431 $470
EBITDA 78 145 184 437 689
EBIT 58 119 145 330 557 Additional Ratio Analysis
EBT 54 183 147 325 553 Net interest coverage (x) 16.8 40.6 176.1 43.3 95.5
Taxes 22 12 42 91 166 Profit margin 61% 68% 63% 64% 69%
Effective tax rate 41% 7% 29% 28% 30% ROE 7% 21% 4% 7% 11%
Earnings bf. minority interests 31 171 105 235 387 ROA 5% 18% 3% 6% 8%
Minority interest - 5 3 17 26 EV/EBITDA (x) 26.8 16.6 22.4 20.1 12.5
Reported net earnings 31 166 102 217 361 Net Debt/Equity na na na na na
Adjusted net earnings 31 166 102 217 361 Book Value (US$/sh) 1.29 2.21 6.74 5.50 6.18
Reported EPS (US$/sh) 0.09 0.24 0.26 0.40 0.65 Free cash flow (US$/sh) (0.07) (0.05) 0.22 0.09 0.37
Adjusted EPS (US$/sh) 0.12 0.24 0.25 0.39 0.65 Production Profile
1,500,000
Cash Flow Statement Items (US$mm)
Gold Production (oz
$400
Total Cash Costs

1,200,000
Net earnings 31 166 102 217 361
(US$/oz)
900,000 $300
DD&A 20 26 39 107 132
Au)
600,000
Deferred taxes 17 (13) (3) 0 33 $200
300,000
Minority interest - 5 3 17 26
0 $100
Other (4) (57) 6 19 (3) 2008A 2009A 2010E 2011E 2012E 2013E 2014E
Operating CF bf. ch. in WC 65 127 147 361 549
Total Production Total Cash Costs (Au)
CF from operating activities 70 105 192 315 502
CF from financing activities 8 (51) 25 (0) (27) NAV Analysis
CAPEX (94) (124) (107) (210) (242) Asset NAV (US$ mm) NAV/Sh (C$)
CF from investing activities (92) (38) (14) (205) (236) Kisladag 100% $2,102.6 $4.15
Net change in cash (14) 16 204 109 239 TJS project 85% $278.5 $0.55
CFPS bf. ch. in WC (US$/sh) 0.20 0.35 0.38 0.66 0.99 Efemcukuru 100% $584.7 $1.16
Balance Sheet Items (US$mm) Perama Hill 100% $334.9 $0.66
Cash 46 62 315 375 664 Vila Nova 100% $188.5 $0.37
Current assets 203 229 491 644 1,010 Jinfeng 82% $943.9 $1.86
Property, plant & equipment 378 668 2,581 2,825 2,935 White Mountain 95% $275.1 $0.54
Total assets 592 905 3,436 3,866 4,342 Eastern Dragon 95% $382.4 $0.76
Short-term debt 65 0 56 90 90 Tocantinzinho 100% $209.4 $0.41
Current liabilities 106 44 218 255 293 Exploration & Other Assets Var $254.4 $0.50
Long-term debt 0 - 135 97 97 Mining Assets $5,554.4 $10.97
Total liabilities 143 114 795 865 933 Working Cap. & ITM Options $361.0 $0.71
Minority interest - 5 26 42 69 Net LT Debt ($97.2) ($0.19)
Shareholder's equity 449 792 2,641 3,001 3,409
Working capital 98 185 273 389 717 Total NAV $5,818.1 $11.49
Source: Company reports, TD Newcrest.
Steven Green, CFA (416) 307-6304 steven.green@tdsecurities.com
January 11, 2011
27 of 86
Metals & Minerals Greg Barnes Bonita To (Associate)

Recommendation: HOLD
Unchanged
Risk: HIGH
Prior:
C$18.00↓
C$20.00
HudBay Minerals Inc.
(HBM-T) C$16.21
Market Data (C$)
Norsemont acquisition success hangs on exploration upside
52-Wk Range $9.86-$19.08
EV ($mm) $2,114.0
HudBay announced the acquisition of Norsemont Mining (NOM-T; not rated)
Dividend Yield 1.2% for a cash plus shares consideration equivalent to C$520M.
Avg. Daily Trading Vol. (3mths) 908767
Financial Data (C$) Impact
Fiscal Y-E December Mixed – The focus of the Norsemont acquisition is the Costancia copper
project in Southern Peru that could achieve production by 2015/16. While the
Net Cash ($mm) $751.7 acquisition enhances HudBay’s longer-term project development pipeline and
Net Debt/Tot Cap NA drives the company’s revenue stream further towards copper, it is also10-14%
NAVPS (current)(f.d.) $15.67
dilutive to our EPS and CFPS estimates given that we do not expect the
Working Cap ($mm) $766.6
Constancia copper project to be in production until H2/15.
Estimates (C$)
Year 2009A 2010E 2011E 2012E
The Constancia project area incorporates a number of exploration targets,
EBITDA ($mm) 136.0 247.0 330.0 376.0
EBITDA (old)($mm) 136.0 247.0 330.0 376.0 including the Pampacancha Skarn, from which high-grade Cu/Au/Mo drill
EPS (f.d.) 0.31 0.43 0.63 0.75 intercepts have been reported. We believe that exploration success on these
EPS (f.d.)(old) 0.31 0.43 0.70 0.87 targets could be the variable that makes this a successful acquisition over the
CFPS (f.d.) 0.81 1.17 1.24 1.30 longer term.
CFPS (f.d.)(old) 0.81 1.17 1.38 1.49
EPS (f.d.) Quarterly Estimates (C$) We estimate that HudBay is paying approximately US$1.60/lb of recoverable
Year 2009A 2010E 2011E 2012E
Q1 (0.02) 0.16 -- --
copper using total cost analysis (purchase price + capital cost (including
Q2 0.07 0.09 -- -- sustaining capital) + LOM operating cost divided by pounds recoverable
Q3 0.16 0.06 -- -- copper). This compares to First Quantum’s purchase of Antares Minerals at
Q4 0.11 0.11 -- -- US$1.42/lb and Equinox’s acquisition of Citadel Resource Group at
Valuations US$1.66/lb.
Year 2009A 2010E 2011E 2012E
EV/EBITDA 15.5x 8.6x 6.4x 5.6x
The acquisition diversifies HudBay regionally and provides for exploration
P/E (f.d.) 52.3x 37.7x 25.7x 21.6x
P/CFPS (f.d.) 20.0x 13.9x 13.1x 12.5x
upside. As well, the Constancia project is of a scale that we believe HudBay
Supplemental Data (US$)
has the financial strength to build without a larger partner becoming involved.
Year 2009A 2010E 2011E 2012E The project is a step-out technically for management given that the company
Zinc-US$/lb 0.75 0.96 1.10 1.25 has never built a large scale, open pit mine in South America. Based on our
Copper-US$/lb 2.34 3.40 4.10 4.25 modeling (we use a more conservative LT copper price, higher discount rate
Zn (000s t) 105 83 76 66 and higher capex than contained in Norsemont’s optimization study), the
Cu (000s t) 53 51 56 41
acquisition is approximately 3% dilutive to our NAV. We have reduced our
target price to C$18.00 (from C$20.00) and we are maintaining our HOLD
All figures in C$, unless otherwise specified. recommendation.
HBM-T: Price
Hudbay Minerals owns and operates zinc-
20 20
copper mines, concentrator facilities, a zinc
refinery and a copper smelter in the region 15 15
surrounding Flin Flon, Manitoba and in
10 10
Saskatchewan.
Please see the final pages of 5 5
0 0
January 11, 2011
28 of 86
Details
Terms of the Transaction.
• Norsemont shareholders have the option to receive either C$4.50/sh in cash or 0.2617 HudBay shares
plus C$0.0001 cash. HudBay will pay a maximum of C$130M in cash – if Norsemont shareholders opt
for the maximum cash payment, Hudbay would issue 23.4M shares; the maximum number of shares
issued would be 31M if Norsemont shareholders do not elect to take any cash.
• The transaction represents a 33% premium to Norsemont's 20-day VWAP ended January 7, 2011.
HudBay has entered into lock-up agreements with some of Norsemont shareholders, representing
approximately 34.4% of Norsemont’s outstanding shares. HudBay currently holds 1.1% of Norsemont’s
outstanding shares. The lock-up agreements and HudBay's current interest represents approximately
35.6% of the fully diluted shares outstanding.
• The acquisition is expected to close by the end of Q1/11 and is subject to over 50% of Norsemont’s
shares being tendered to the offer and normal regulatory approvals. There is a C$21.6M break fee payable
to HudBay in the event that Norsemont accepts a superior proposal (HudBay has matching rights).
• We see the potential for a competing offer as low. Norsemont management revealed that 20 companies
have signed confidentiality agreements and that it has had an open door policy for much of the past three
years. It would appear that any company that wanted to review the project has had the opportunity.
Constancia Copper Project

• The Constancia project is located in Southern Peru in the same region as Xstrata’s Las Bambas
project and First Quantum’s Haquira project. The project hosts a Cu/Au/Mo deposit containing
proven and probable reserves totaling 277Mt grading 0.43% Cu, 0.012% Mo and 0.05g/t Au.
• Norsemont recently released preliminary results from an optimization study on a feasibility study
that was completed in September 2009 that suggest an 8% discounted NPV for the project ranging
from US$780-840M. Preproduction capex was estimated at US$900-950M and cash costs at US$0.97-
0.99/lb over a mine life of 15 years. Average annual production was forecast at 78kt Cu, 2.0Mlbs Mo and
2.0Mozs Ag. We note that details available from the optimization study are few.
• The September 2009 feasibility study estimated an 8% NPV of US$304M based on capex of
US$846M, LT copper at US$2.00/lb and US$0.92/lb cash costs. Average annual copper production was
estimated at 68kt.
• Our model suggests an NPV-10% of approximately US$327M at US$2.25/lb LT copper. We have
assumed cash costs after by-product credits are in the range of US$1.00/lb and a pre-production capex of
US$1.05B. In Exhibit 1, we show an NPV-10% matrix based on various LT copper prices and pre-
production capex estimates.
Exhibit 1. Constancia copper project sensitive to copper price and capex
10% NPV - C$ millions

LT Copper price - US$/lb 2.00 2.25 2.50
Capex - US$ millions

950 164 428 692
1050 63 327 592
1150 -28 235 500
1250 -112 152 416

Source: TD estimates
• We have added C$100M for exploration upside. The Pampacancha discovery is located 2.5km south-
east of the proposed mine development area and has the potential to add significant value to the project.
The Pampacancha Main Body covers an area of approximately 1,000m in a NS-NW direction and 300-
400m wide. Drill intercepts have been reported that include more than 60m grading 2.5% Cu. In addition,
January 11, 2011
29 of 86
high grade gold mineralization has been identified in the area resulting from overprinting epithermal
mineralization.
• Norsemont acquisition is 3% dilutive to our NAV. Our revised NAV is summarized in Exhibit 2.
Taking into account both our NPV for the Constancia copper project and our exploration credit, our NAV
has declined to C$15.67/sh from C$16.13.
Exhibit 2. TD Newcrest revised HudBay net asset value matrix
8% 10% 12%
Interest C$000 C$/sh C$000 C$/sh C$000 C$/sh
Mining Operations
Flin Flon 100% $912,414 $5.16 $847,767 $4.80 $789,871 $4.47
Balmat 100% $0 $0.00 $0 $0.00 $0 $0.00
Lalor Gold 100% $100,978 $0.57 $79,454 $0.45 $63,620 $0.36
Lalor Copper/Gold 100% $199,489 $1.13 $171,950 $0.97 $148,926 $0.84
Lalor Zinc 100% $489,272 $2.77 $363,858 $2.06 $265,692 $1.50
Reed Lake 70% $71,345 $0.40 $71,345 $0.40 $71,345 $0.40
Back Forty 65% $128,000 $0.72 $105,000 $0.59 $85,000 $0.48
Costancia Project 100% $625,756 $3.54 $427,380 $2.42 $227,735 $1.29
Fenix-Ferro 100% $150,000 $0.85 $150,000 $0.85 $150,000 $0.85
$2,677,255 $15.14 $2,216,754 $12.54 $1,802,189 $10.19
Plus/(Minus)
Corp Costs ($246,022) ($1.39) ($213,397) ($1.21) ($187,284) ($1.06)
Cash $751,739 $4.25 $751,739 $4.25 $751,739 $4.25
Net Working Cap. $14,873 $0.08 $14,873 $0.08 $14,873 $0.08
Long term Debt $0 $0.00 $0 $0.00 $0 $0.00
Sub Total $520,590 $2.94 $553,215 $3.13 $579,328 $3.28
Total NAV $3,197,844 $18.09 $2,769,969 $15.67 $2,381,517 $13.47
Source: TD estimates
Outlook
We have assumed that HudBay issues 23M shares and pays C$130M in cash to Norsemont shareholders
(maximum cash consideration). We have also assumed that the transaction closes at the end of Q1/11. Our
2011 EPS and CFPS estimates have declined 10%, while our 2012 estimates have declined 13%.
Valuation
HudBay Minerals currently trades at an EV/2012 EBITDA multiple of 5.6x and a P/NAV multiple of 1.0x,
compared to its intermediate-small cap. peer group average of 4.5x and 1.1x, respectively.

Reflecting the dilution to our NAV and our estimates for the next several years, we have lowered our target
price to C$18.00 from C$20.00. Our target price is based on an EV/2012E EBITDA multiple of 4.50x (40%
weighting) and a 1.30x multiple to our NAV-10% (60% weighting).

The main risks facing the company include forecast, financial, technical and political risks. Among other
things, these include risks related to copper, zinc and nickel prices, input costs and fuel prices, the governing
fiscal and legislative regimes, the timing of key developments, market conditions, capital and operating costs,
foreign exchange rates, resources and reserves, operating parameters, permitting, environmental, and staffing
and key personnel retention. The company will be developing the Fenix nickel project and Lalor Lake zinc
project – capital costs and timelines may not match our forecasts. There is forecasting risk related to the size of
the Lalor deposit.
We are maintaining our HOLD recommendation.
January 11, 2011
30 of 86
Energy Producers - Seniors & Menno Hulshof, CFA Juan Jarrah, P. Eng. (Associate)
Unconventional
Prior: HOLD
Risk: HIGH
12-Month Target Price: C$27.00↑
Nexen Inc.
(NXY-T, NXY-N) C$21.82
Prior: C$24.00
Time to Show Some Love - Upgrading to BUY
Market Data (C$)
52-Wk Range $18.33-$26.91 Event
Mkt Cap (f.d.)($mm) $11,555.9 We are upgrading Nexen Inc. (NXY-T) to BUY from Hold this morning. We
Mkt Cap (basic)($mm) $11,455.5
EV ($mm) $15,944.5
acknowledge that this is somewhat of a contrarian call but believe there are
Dividend per Share $0.20 enough positive indicators to warrant an upgrade at this time.
Dividend Yield 0.9%
Avg. Daily Trading Vol. (3mths) 1,564,005 Our decision to upgrade is underpinned by a) recent share price
Financial Data (C$) underperformance, b) operational shortcomings which now appear to be
Fiscal Y-E December
Shares O/S (f.d.)(mm) 529.6 almost fully reflected in the current share price, c) our expectations of top-
Shares O/S (basic)(mm) 525.0 quartile PPS growth in 2012 (driven by first production at Usan, offshore
Float Shares (mm) -- Nigeria, and to a lesser degree Horn River production additions), and d) this
Net Debt ($mm) $4,489.0
morning’s price deck revisions. Our target price increases to $27/share, from
$24/share previously.
Estimates (C$)
Year 2009A 2010E 2011E 2012E
CFPS (f.d.) 4.18 3.82 4.91 5.37
Impact
CFPS (f.d.)(old) -- 3.83 4.48 5.12 Positive
NAVPS (f.d.) 31.71 -- -- --
Oil (b/d) 204,684 197,983 201,062 224,514 Details
Gas (MMcf/d) 227.9 265.5 283.6 349.0
MBOE/d 242.7 242.2 248.3 282.7
1) Relative share price underperformance: Nexen’s share price suffered on
Valuations a relative basis in 2010. Nexen shares fell 9.6% compared with the S&P TSX
Year 2009A 2010E 2011E 2012E Energy Index which appreciated 10.0%. In comparison, Canadian Natural
P/CFPS (f.d.) 5.2x 5.7x 4.4x 4.1x
EV/DACF 6.3x 6.8x 5.6x 5.3x
Resources Ltd. (CNQ-T), Encana Corp. (ECA-N) and Talisman Energy Inc.
P/NAV 68.8% -- -- -- (TLM-T) were up 16.7%, down 10.1% and up 12.3%, respectively.
Supplemental Data
Year 2009A 2010E 2011E 2012E Exhibit 1: Share price performance
Oil (US$/bbl) $61.85 $79.03 $85.00 $85.00 15% 5.00
NXY: -9.6%;
Gas(US$/mmBtu) $3.99 $4.35 $4.50 $5.25 10%
Index: 10.0% 4.80
Consensus Forward P/CF (x)

F/X (US$/C$) $0.88 $0.97 $0.99 $0.95 5%
YTD Performance (%)
4.60
0%
4.40
-5%
4.20
-10%
All figures in C$, unless otherwise specified. 4.00
-15%
-20% 3.80
-25% 3.60
-30% 3.40
31-Dec 29-Jan 1-Mar 29-Mar 27-Apr 26-May 23-Jun 22-Jul 20-Aug 20-Sep 19-Oct 16-Nov 14-Dec
NXY Forward P/CF Multiple NXY Share Price Performance S&P TSX Energy Index Performance
Source: Capital IQ
NXY-T: Price
Nexen is a Calgary-based global E&P 40 40
company with operations in the North Sea, 35 35
Western Canada (principally the oil sands, 30 30
shale gas and CBM), the Gulf of Mexico, 25 25
Colombia and West Africa.
this document for important 15 15
10 10
January 11, 2011
31 of 86
To be clear, relative underperformance is not, in and of itself, a good reason to upgrade but when combined
with a strong case on relative valuations, we believe it is. 2011 multiples would suggest that the current entry
point is an attractive one. We can make an even more compelling argument on the basis of 2012 multiples
since they reflect the impact of the ramp-up in FPSO production at Usan, offshore Nigeria, and production
additions in the Horn River.
On a 2011E EV/DACF basis, Nexen currently trades at 5.6x compared with the Senior Producers peer group
average of 6.3x. On a 2012E basis, the EV/DACF multiple is 5.3x versus the group average of 5.5x.
2) Effectively getting Long Lake for free? We acknowledge that share price underperformance in 2010 can
largely be explained by shortcomings at Long Lake (operational in nature) and in the GoM (regulatory in
nature). We contend, however, that this is already priced in.
Specifically, if we back out the value of its 65% stake in Long Lake and Kinosis ($9.09/share) from our
corporate risked NAV ($31.71/share), this reflects a value of only $22.62/share, effectively in line with the
current share price. Regardless of one’s view on the long-term productive potential of this project, it is difficult
to argue that this is justified.
Exhibit 2: Risked NAV Summary
$/Share Risked Risked Conventional Conventional Unconventional

Conventional Unconventional Proven Probable 2P + 2C (Best Est) Total
Asset Class Region/Project PV/mcf - PV/bbl (2P) PV/BOE (2P+2C) Gross Per Share Gross Per Share Gross Per Share Gross Per Share % of Total
North American Conventional United States - Gulf of Mexico $13.04 $712 $1.34 $253 $0.48 $965 $1.82 5%
Capital
Onstream Risk
Intensity
Date Factor
($/bbl/d)
North American Unconventional Syncrude - Base + Stage 3 2006 $63,700 0% $4.25 $2,875 $5.43 $2,875 $5.43 14%
Syncrude - Stage 3 Debottleneck 2016 $90,000 50% $40 $0.08 $40 $0.08 0%
Syncrude - Stage 4 2017 $30,000 50% $62 $0.12 $62 $0.12 0%
Syncrude - Stage 5 2018 $54,000 50% $62 $0.12 $62 $0.12 0%
65% WI in Long Lake Phase 1 2008 $120,027 0% $2.83 $4,521 $8.54 $4,521 $8.54 21%
65% WI Kinosis Phase 1 2016 $100,000 50% $165 $0.31 $165 $0.31 1%
65% WI Kinosis Phase 2 2018 $95,000 50% $129 $0.24 $129 $0.24 1%
Other oil sands assets (3.5B bbls * 40% recovery * $0.40 per bbl) $560 $1.06 $560 $1.06 3%
Horn River and Cordova Assets (8 tcf) $1,200 $2.27 $1,200 $2.27 6%
Coal Bed Methane (principally Upper Mannville) $539 $1.02 $539 $1.02 3%
International Yemen (principally Masila and Block-51) $24.40 $439 $0.83 $220 $0.41 $659 $1.24 3%
UK North Sea - Buzzard $17.03 $3,283 $6.20 $1,641 $3.10 $4,924 $9.30 23%
UK North Sea - Scott & Telford $588 $1.11 $294 $0.56 $882 $1.67 4%
Nigeria - Usan FPSO Development (20% WI) $10.55 $408 $0.77 $647 $1.22 $1,055 $1.99 5%
Other (Colombia) $158 $0.30 $147 $0.28 $305 $0.58 1%
Other Assets Chemicals $409 $0.77 $409 $0.77 2%
Undeveloped Land Western Canadian Acreage $172 $0.32 $172 $0.32 1%

US Acreage $98 $0.19 $98 $0.19 0%
Yemeni Acreage $9 $0.02 $9 $0.02 0%
UK North Sea Acreage $13 $0.02 $13 $0.02 0%
Other International Acreage $9 $0.02 $9 $0.02 0%
North American Tax Pools $1,540 $2.91 $1,540 $2.91 7%
Option Proceeds ($mm) $92 $0.17 $92 $0.17
Net Debt (Long-term Debt + Preferred Shares - Net Working Capital) -$4,489 -$8.48 -$4,489 -$8.48
Total $16,796 $31.71
Source: TD Newcrest estimates, Company reports
Finally, if we start to look beyond the overhang created by Long Lake and the GoM, the outlook has the
potential to improve dramatically in the coming quarters. This brings us to our third and final point:
3) Positioned to deliver top-quartile PPS growth in 2012: Although 2012 may still seem a long way off, it is
in fact just around the corner from a ‘share positioning’ perspective since Usan, the primary engine of near-
term production growth, is set to come on-stream in the Q2/Q3 2012 timeframe.
Specifically, Usan is expected to add productive capacity of net 36 mbbls/d (gross 180 mbbls/d). This is
clearly meaningful in the context of our 2011E production estimate of 248.3 mBOE/d. Further, since Usan is to
be produced from a FPSO, the ramp-up to peak rates should be achieved relatively quickly (expect it to test
design rates towards the end of 2012). Of note, we are modeling 90% uptime but argue that this is relatively
conservative given execution at other projects like Buzzard where it has, on several occasions produced at rates
well in excess of design capacity. Of note, we are modeling PSC terms that are circa early-1990’s as specific
terms for Usan remain confidential.
January 11, 2011
32 of 86
On the basis of Usan production additions, we are forecasting 2012 PPS growth of 14% which compares
favorably with its peers at 7%. We are also anticipating a modest contribution from the 9-well pad that is
currently being drilled at Dilly Creek in the Horn River.
Exhibit 3: Production Profile
60%
Exposure (Measured as Percentage of Total Production)
50% Impact of full prod'n

at Buzzard
40%
Sharp declines
30% at Block 51 and
Masila
First prod'n
out at Usan
20%
Increased
Production from
10% Horn River
0%
UK North Sea Yemen Crude Syncrude Cdn Natural Cdn Crude Oil GOM Natural GOM Crude Offshore UK North Sea CBM & Horn Long Lake
Crude Oil Oil & NGLs SSB Gas & NGLs Gas Oil & NGLs West Africa & Natural Gas River PSC
Other Crude
Oil
2007 2009 2011E 2013E
Source: Company reports, TD Newcrest estimates
Although we acknowledge that some residual execution risk remains at Usan (overruns/delays), we contend
that the majority of the risk has been taken out of the project. Nexen is currently guiding to a net cost of $2B.
Our estimates suggest that this project has the potential to kick off an average of $690mm in after-tax cash
flows in the first five years of the project (long-term WTI oil price forecast of US$85/bbl).
This boost to CF has the potential to positively impact recent FCF deficits and will also help strengthen the
balance sheet (2010E Net Debt/Total Cap ratio stands at 35% and is the highest in the group). We are currently
forecasting a 2012 FCF surplus of $234mm. Although this can hardly be considered to be a massive surplus
(~2% FCF yield), it is worth noting that this will be the first FCF surplus generated by the company since
2008.
Valuation
Nexen is currently trading at 69% of NAV and 5.6x 2011E EV/DACF. This compares with the peer group
average of 82% and 6.3x respectively.

Our fully-expanded risked NAV plus a 12-month projected growth rate generates a value of $33.30/share (60%
weighting) while applying historical EV/DACF multiples to rolling 12-month DACF estimates generates a
value of $21.90/share (40% weighting). Blending the two valuation methodologies generates a 12-month target
price of $27/share and our BUY recommendation.

limited to: loss of key employees, drilling success, volatile commodity prices and operating costs, capital cost
overruns, product supply and demand, government regulations and taxes, exchange rates, interest rates,
environmental and weather concerns and unfavourable tax legislation.
January 11, 2011
33 of 86
The key risks specific to Nexen, in our view, include the following: 1) operating results at Long Lake that
continue to disappoint, 2) exploration drilling results that fall short of expectations in the near-term (Knotty
Head, North Uist and Brant prospects), 3) an unsuccessful outcome to the Yemen contract renegotiation, 4)
higher than average geopolitical risk relating to offshore Nigeria and environmental risk in the GOM due to
hurricane activity, and 5) possible delays in the construction and start-up of the Usan FPSO.
We acknowledge that our decision to upgrade is a contrarian call but believe there are enough positive
indicators to warrant an upgrade at this time. To review, our decision to upgrade is underpinned by a) recent
share price underperformance, b) operational shortcomings which now appear to be almost fully reflected in
the current share price, c) our expectations of top-quartile PPS growth in 2012 (driven by first production at
Usan, offshore Nigeria and Horn River production additions to a lesser degree), and d) this morning’s price
deck revisions.
January 11, 2011
34 of 86
Exhibit 4: Financial and Operating Summary Charts
Average Daily Production (boe/d) EPS and CFPS ($ per share)
300,000 290 $1.80
Natural Gas Production (mmcf/d)

$1.60
Oil & NGL Production (bbls/d)
280
250,000
$1.40
EPS & CFPS ($/share)

270
200,000 $1.20
260
$1.00
150,000 250
$0.80
240 $0.60
100,000
230 $0.40
50,000
220 $0.20
0 210 $0.00
Q4/09 Q1/10 Q2/10 Q3/10 Q4/10E Q4/09 Q1/10 Q2/10 Q3/10 Q4/10E
Total Average Daily Production (boe/d @ 6:1) CFPS (FD) EPS (FD)
Oil & Liquids (bbl/d)
Natural Gas (mmcf/d)
Commodity Prices Consolidated Realized Prices

$86 $8 $88 $9
$84 $7 $86 $8
Realized Oil & Liquids Price
Realized Natural Gas Price

$84
$82 $6 $7
Nymex (US$/mmbtu)
$82
$6
WTI (US$/bbl)
(US$/mmbtu)
$80 $5 $80
(US$/bbl)
$78 $5
$78 $4
$76 $4
$76 $3 $74 $3
$74 $2 $72
$2
$70
$72 $1 $1
$68
$70 $0 $66 $0
Q4/09 Q1/10 Q2/10 Q3/10 Q4/10E Q4/09 Q1/10 Q2/10 Q3/10 Q4/10E
Consolidated Corporate Oil & Liquids Price (C$/bbl)
WTI (US$/bbl) Nymex (US$/mmBTU)
Consolidated Corporate Natural Gas Price (C$/mcf)
Netback Summary Operating Cost Summary
$80 $20
$18
$70
$16
Operating Cost (C$/BOE)
$60 $14
Netback (C$/BOE)
$12
$50
$10
$40 $8
$30 $6
$4
$20
$2
$10 $0
Q4/09 Q1/10 Q2/10 Q3/10 Q4/10E Q4/09 Q1/10 Q2/10 Q3/10 Q4/10E
Netback - Canada Heavy Crude Operating Costs - Canada Heavy Crude
Netback - Canada Natural Gas Operating Costs - Canada Natural Gas
Netback - US Crude Oil & Natural Gas Operating Costs - US Crude Oil & Natural Gas
Netback - UK North Sea Oil & Natural Gas Operating Costs - UK North Sea Oil & Natural Gas
Netback - Yemen Crude Oil Operating Costs - Yemen Crude Oil
Bow River at Hardisty Returns

$80 24% 35%
Bow River Heavy Diff (as % of WTI)
$70 21%
Bow River at Hardisty (C$/bbl)
30%
$60 18%
25%
$50 15%
20%
% Return
$40 12%
15%
$30 9%
$20 6% 10%
$10 3% 5%
$0 0%
0%
Q4/09 Q1/10 Q2/10 Q3/10 Q4/10E
2006 2007 2008 2009 2010E
ROE ROACE
Bow River Heavy Differential (as % of WTI)
Source: Company reports and TD Newcrest estimates

January 11, 2011
35 of 86

Recommendation: REDUCE↓
Prior: HOLD
Risk: HIGH
Prior:
C$26.00↑
C$25.00
Paramount Resources Ltd.
(POU-T) C$31.43
12-Month Total Return: -17.3%
Market Data (C$)
POU-Target Up, Rating Down On Share Price Performance
52-Wk Range $14.31-$31.79
Mkt Cap (basic)($mm) --
TD is now basing target prices on YE-2010E reserves and 2012E DACF
EV ($mm) $1,899.0
Dividend Yield -- Impact
Avg. Daily Trading Vol. (3mths) 105879 Negative
Financial Data (C$)
Fiscal Y-E December
Details
Float Shares (mm) -- Entering 2011 we are i) updating our commodity price forecast; ii)
Net Debt ($mm) $198.0 introducing 2012 estimates; iii) estimating year end 2010 reserves and using
Net Debt/Tot Cap --
this updated reserve estimate in our Net Asset Value analysis (both
Estimates (C$) Blowdown and Modified Growth).
Year 2009A 2010E 2011E 2012E
CFPS (f.d.) 0.90 1.13 1.00 1.61
Outlook
CFPS (f.d.)(old) -- 1.15 1.15 --
Oil (b/d) 3,580 3,427 3,546 3,818
Gas (MMcf/d) 51.8 58.5 81.8 114.8 taking a somewhat conservative view on prices and are estimating a WTI
MBOE/d 12,207 13,171 17,186 23.0 price of US$85/bbl through 2011 and 2012. In our view, fundamentals for the
Valuations
Year 2009A 2010E 2011E 2012E do not support current prices.
EV/DACF 11.4x 28.6x 26.1x 18.1x
P/NAV -- 143.0% -- -- Looking at natural gas, above-average withdrawals have somewhat reduced
Supplemental Data the overhang in inventories; however, seasonal gas inventory levels remain
Year 2009A 2010E 2011E 2012E near record highs due to ample supply. Given the continued oversupply of the
WTI (US$/bbl) $61.97 $79.50 $85.00 $85.00
NYMEX (US$) $4.16 $4.36 $4.50 $5.25
AECO (C$) $4.00 $3.99 $3.90 $4.65 (previously $5.75) in 2011 and US$5.25/mcf in 2012. Our new commodity
F/X (US$) $0.88 $0.97 $0.99 $0.98 price forecasts are outlined in Exhibit 1.
After incorporating a significant uptick in reserves into our NAV model,

we calculate an improved NAV. The impact of this results in our target
price increasing to $26.00 (from $25.00). However, with the company’s
share price increasing 53% since the beginning of November, our target
price now equates to a negative return of 17%. As such, we are lowering
our rating to REDUCE (from Hold).
POU-T: Price
Paramount is a Canadian oil and natural gas 30 30
exploration, development and production 25 25
company with operations focused in Western 20 20
Canada. 15 15
this document for important 5 5
0 0
January 11, 2011
36 of 86

2010A 2011E 2012E
WTI (US$/bbl) $79.50 $85.00 $80.00 $93.23 10% $85.00 $93.94 11%
Edmonton ($/bbl) $76.80 $83.50 $80.90 - - $84.60 - -
NYMEX (US$/mcf) $4.36 $4.50 $5.75 $4.56 1% $5.25 $5.08 -3%
AECO ($/mcf) $3.99 $3.90 $5.10 $3.99 2% $4.65 $4.49 -3%
FX (US$) $0.97 $0.99 $0.97 $1.00 1% $0.98 $0.99 1%
Source: Bloomberg, TD Newcrest
Valuation
POU 157% 143% 26.1x 18.1x $156,950 $121,792 $67.41 4.4x 286% - 79%
Average 157% 101% 10.2x 8.8x $93,744 $90,489 $25.91 2.1x 122% 5% 53%
>60% Gas 154% 112% 11.9x 9.2x $76,205 $68,787 $23.48 3.0x 135% 2% 78%
>60% Oil 168% 100% 9.6x 9.2x $127,358 $127,682 $32.73 1.3x 110% 6% 26%
Yield 159% 98% 9.6x 8.6x $93,236 $92,893 $24.16 2.1x 118% 5% 49%
No Yield 148% 115% 13.0x 9.8x $95,901 $80,269 $33.37 2.1x 141% 0% 70%

then adjusted by a subjective factor of +15.5% (within a range of +/- 25% for the sector).

royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks associated
with Paramount include the long term approach to development, which may not match an investor's profile, the
allocation of capital to investments, the high ownership of the Riddell family and management as well as the
asset concentration where a high % of total production comes from 25 wells.
Paramount is at the start of what we expect to be an accelerated growth phase, with production forecast to
grow an average of 25% annually through 2012, but spending on average 230% of annual cash flow. Drilling
results at Karr-Gold Creek, Kaybob and Grande Prairie continue to improve as Paramount optimizes the
completion methodology through longer horizontal legs and increased frac intensity. New and expanded
facilities will be needed to bring much of this on production. At Gold Creek the company is completing a 20
mmcf/d facility in Q4/10 and will be expanding this by an equal amount in Q1/11. At Kaybob, the company
has committed to a 50 mmcfd plant expansion at Smoky and a new 50 mmcf/d plant at Musreau.
Paramount sold $300 million of 8.25% unsecured notes due 2017, improving balance sheet flexibility
considerably. This provides the capacity to fund what we forecast to be a 2011E E&D capex program of $225
million, up about 14% from 2010. The company has investments worth nearly $475 million, with the bulk
represented by its ownership of shares in Trilogy Corp and MEG Energy.
January 11, 2011
37 of 86

PARAMOUNT RESOURCES LTD.
POU $31.43 POU $26.00 REDUCE
CFPS (fd) $3.89 $2.53 $1.42 $2.65 $0.90 $1.13 $1.00 $1.61
DPS (Basic) - - - - - - - -
NAVMG - - - - - $21.99 - -
Valuation
Share Price (Avg) $21.25 $33.37 $19.25 $14.33 $8.95 $31.43 $31.43 $31.43
Market Cap ($mm) $1,407 $2,345 $1,303 $957 $645 $2,353 $2,353 $2,353
Net Debt ($mm) $420 $616 -$15 $97 $62 $198 $344 $442
Enterprise Value ($mm) $1,827 $2,961 $1,288 $1,053 $706 $2,551 $2,697 $2,796
Yield - - - - - - - -
P/NAV - - - - - 143% - -
P/CF 5.5x 13.2x 13.5x 5.4x 10.0x 27.7x 31.5x 19.6x
EV/DACF 7.6x 14.4x -12.7x 3.0x 11.4x 28.6x 26.1x 18.1x
EV/BOEPD $73,425 $171,579 $77,256 $76,511 $57,859 $193,698 $156,950 $121,792
EV/2PBOE (Pro Forma) $36.13 $52.66 $31.21 $28.95 $20.48 $67.41 - -
Production
Oil & NGLs (bbls/d) 4,452 3,652 3,539 3,594 3,580 3,427 3,546 3,818
Heavy Oil (bbls/d) - - - - - - - -
Gas (mmcf/d) 122.6 81.6 78.8 61.0 51.8 58.5 81.8 114.8
Total BOE/d (6:1) 24,888 17,256 16,672 13,764 12,207 13,171 17,186 22,953
Gas % 82% 79% 79% 74% 71% 74% 79% 83%
PDP 17.7 19.6 18.5 18.1 17.2 19.0 - -
Proved 28.0 31.2 26.1 22.2 21.3 23.5 - -
Proved + Probable 50.6 56.2 41.3 36.4 34.5 37.8 - -
% Proved 55% 55% 63% 61% 62% 62% - -
RLI (Proven) 4.1 5.0 5.0 5.0 5.1 - - -
RLI (P+P) 7.4 9.0 7.9 8.2 8.2 - - -
FD&A + FDC (Proven) ($11.29) $70.37 $235.46 $170.15 $22.00 - - -
FD&A +FDC (P+P) ($6.56) $64.49 ($19.92) $983.72 $35.66 - - -
Recycle Ratio (Proven) -2.1x 0.4x -0.1x 0.4x 0.5x - - -
Recycle Ratio (P+P) -3.6x 0.4x 1.1x 0.1x 0.3x - - -
Growth
Production Growth
Absolute - (31%) (3%) (17%) (11%) 8% 30% 34%
Per Share - (34%) (6%) (15%) (10%) (1%) 27% 34%
Per Share (Debt Adjusted) - (30%) 8% (14%) (20%) 10% 22% 28%
P+P Reserve Growth
Absolute - 11% (27%) (12%) (5%) - - -
Per Share - 5% (24%) (11%) (12%) - - -
Per Share (Debt Adjusted) - (15%) 30% (25%) (4%) - - -
Netback ($/BOE)
Gross Revenue $53.78 $49.63 $46.58 $64.16 $34.38 $38.52 $37.27 $39.58
Royalties ($10.04) ($7.61) ($7.02) ($9.49) ($4.64) ($4.68) ($4.85) ($5.15)
Operating ($8.35) ($11.42) ($13.70) ($14.31) ($12.72) ($10.60) ($9.89) ($9.94)
Transportation ($2.70) ($2.25) ($2.61) ($3.12) ($3.11) ($3.56) ($3.25) ($3.25)
Hedge Gain/(Loss) ($1.33) $6.70 $1.98 $3.45 $0.00 $1.64 $0.00 $0.00
Interest ($3.01) ($5.39) ($5.28) ($1.97) ($2.52) ($2.64) ($3.93) ($3.31)
Cash Taxes ($1.07) ($0.27) ($0.18) $0.81 $0.20 ($0.00) $0.00 $0.00
Other Cash Items ($1.15) $2.84 ($35.88) $32.52 $3.64 $0.49 $0.00 $0.00
Cash Netback $23.53 $27.25 ($21.97) $66.90 $11.37 $15.94 $12.56 $15.14
Cash Flow ($mm)
Gross Revenue $489 $313 $283 $323 $153 $185 $234 $332
Royalties ($91) ($48) ($43) ($48) ($21) ($22) ($30) ($43)
Operating ($76) ($72) ($83) ($72) ($57) ($51) ($62) ($83)
Transportation ($25) ($14) ($16) ($16) ($14) ($17) ($20) ($27)
Hedge Gain/(Loss) ($12) $42 $12 $17 $0 $8 $0 $0
Interest ($27) ($34) ($32) ($10) ($11) ($13) ($25) ($28)
Cash Taxes ($10) ($2) ($1) $4 $1 ($0) $0 $0
Other Cash Items ($10) $18 ($218) $164 $16 $2 $0 $0
Cash Flow ($mm) $214 $172 ($134) $337 $51 $77 $79 $127
US$10.00/bbl ∆ WTI - - - - - - 9% 8%
C$1.00/mcf ∆ AECO - - - - - - 33% 30%
Hedging (%)
% Liquids Hedged - - - - - 0% 0% 0%
% Gas Hedged - - - - - 41% 0% 0%
% Hedged - - - - - 30% 0% 0%
E&D Capex ($410) ($456) ($282) ($189) ($99) ($197) ($225) ($225)
Net Acquisitions ($14) ($65) $52 $6 ($18) ($57) $0 $0
Total Capex ($423) ($522) ($230) ($183) ($117) ($253) ($225) ($225)
Dividend $0 $0 $0 $0 $0 $0 $0 $0
DRIP Savings $0 $0 $0 $0 $0 $0 $0 $0
Free Cash Flow (Financing Requirement) ($210) ($350) ($364) $154 ($66) ($177) ($146) ($98)
Tax Pools $964 $1,206 $958 $1,038 $1,130 - - -
Payout Ratio
E&D Capex/CF 192% 266% -211% 56% 195% 257% 286% 177%
Dividend/CF 0% 0% 0% 0% 0% 0% 0% 0%
(Capex+DPS-DRIP)/CF 192% 266% -211% 56% 195% 257% 286% 177%
Debt ($mm)
Bank Debt $105 $85 - - - - - $64
Working Capital Deficit $66 $107 ($150) ($13) ($32) ($102) $44 $79
Convertibles & Notes $248 $424 $135 $109 $94 $300 $300 $300
Net Debt $420 $616 ($15) $97 $62 $198 $344 $442
Credit Facility $136 $200 $155 $125 $125 $160 $160 $160
% Drawn 78% 43% 0% 0% 0% 0% 0% 40%
January 11, 2011
38 of 86

Prior: BUY
Risk: HIGH
Unchanged
Pengrowth Energy Corp.
(PGF-T) C$12.85
Market Data (C$)
Rating Reduced on Strong Share Price Performance
52-Wk Range $9.47-$13.28
TD is now basing target prices on YE-2010E reserves and 2012E DACF
Dividend Yield --
Avg. Daily Trading Vol. (3mths) 1,337,699
Fiscal Y-E December Negative
Net Debt ($mm) $1,190.0
Details
Net Debt/Tot Cap -- Entering 2011 we are i) updating our commodity price forecast; ii)
introducing 2012 estimates; iii) estimating year end 2010 reserves and using
Estimates (C$)
Year 2009A 2010E 2011E 2012E this updated reserve estimate in our Net Asset Value analysis (both
CFPS (basic) 2.23 1.96 1.89 1.99 Blowdown and Modified Growth).
CFPS (basic)(old) -- 2.00 1.99 --
Debt/CF 2.0x 2.0x 2.0x 1.9x Outlook
Oil (b/d) 39,982 37,916 40,340 41,868
Gas (MMcf/d) 237.2 224.7 222.1 206.2
MBOE/d 79.5 75.4 77.4 76.2 taking a somewhat conservative view on prices and are estimating a WTI
price of US$85/bbl through 2011 and 2012. In our view, fundamentals for the
Valuations
Year 2009A 2010E 2011E 2012E
EV/DACF 5.7x 6.6x 6.8x 6.5x
do not support current prices.
P/NAV -- 89.0% -- --
Supplemental Data (C$) Looking at natural gas, above-average withdrawals have somewhat reduced
Year 2009E 2010A 2011E 2012E the overhang in inventories; however, seasonal gas inventory levels remain
WTI (U$/bbl) $61.97 $79.50 $85.00 $85.00 near record highs due to ample supply. Given the continued oversupply of the
NYMEX (US$) $4.16 $4.36 $4.50 $5.25 commodity, we are now estimating a NYMEX gas price of US$4.50/mcf
AECO (C$) $4.00 $3.99 $3.90 $4.65
F/X (US$) $0.88 $0.97 $0.99 $0.98
(previously $5.75) in 2011 and US$5.25/mcf in 2012. Our new commodity
All figures in C$, unless otherwise specified. With slight changes to our cash flow and NAV estimates, we are
maintaining our $14.00 target price on Pengrowth. However, since the
beginning of September, Pengrowth shares have appreciated 25%, which
narrows our 12-month total return expectation to less than 10%. Based
on current valuation, we are reducing our rating on Pengrowth to
HOLD, from Buy.
PGF-T: Price
Headquartered in Calgary, Alberta, Canada,
Pengrowth Energy Trust is one of the largest 20 20
energy royalty trusts in Canada. Trust units

trade on the Toronto Stock Exchange ( 15 15
PGF.UN ) and the New York Stock

Please see the final pages of Exchange ( PGH ). 10 10

5 5
January 11, 2011
39 of 86

2010A 2011E 2012E
WTI (US$/bbl) $79.50 $85.00 $80.00 $93.23 10% $85.00 $93.94 11%
Edmonton ($/bbl) $76.80 $83.50 $80.90 - - $84.60 - -
NYMEX (US$/mcf) $4.36 $4.50 $5.75 $4.56 1% $5.25 $5.08 -3%
AECO ($/mcf) $3.99 $3.90 $5.10 $3.99 2% $4.65 $4.49 -3%
FX (US$) $0.97 $0.99 $0.97 $1.00 1% $0.98 $0.99 1%
Valuation
PGF 161% 89% 8.0x 7.5x $70,188 $71,177 $16.81 2.0x 106% 7% 48%
Average 157% 101% 10.2x 8.8x $93,744 $90,489 $25.91 2.1x 122% 5% 53%
>60% Gas 154% 112% 11.9x 9.2x $76,205 $68,787 $23.48 3.0x 135% 2% 78%
>60% Oil 168% 100% 9.6x 9.2x $127,358 $127,682 $32.73 1.3x 110% 6% 26%
Yield 159% 98% 9.6x 8.6x $93,236 $92,893 $24.16 2.1x 118% 5% 49%
No Yield 148% 115% 13.0x 9.8x $95,901 $80,269 $33.37 2.1x 141% 0% 70%

then adjusted by a subjective factor of +2.5% (within a range of +/- 25% for the sector).

The company is, perhaps, midway through a transition. With a new CEO at the helm, Pengrowth is focused on
improving its balance sheet, operator focus and shifting its asset portfolio from conventional to repeatable
resource play assets. As part of this updated strategy, Pengrowth acquired Monterey Exploration in order to
add a scalable natural gas resource play to its portfolio. The acquisition looks to be expensive given current
natural gas prices, but was an integral part of management’s strategy to reposition its asset base. Within its
legacy assets, Pengrowth has adopted horizontal drilling technology with acid fracture stimulations to develop
liquids rich gas and light oil from its Swan Hills carbonate assets and is in the early days of horizontal drilling
of its Viking and Cardium light oil lands. Longer-term, Pengrowth will continue to execute on its resource
focused value creation strategy through the continued advancement of its Horn River assets and its Lindbergh
oil sands lease.
In 2011, the company will spend $50 million advancing its Lindbergh oil sands pilot. This combined with the
deferral of development of the recently acquired Monterey Montney assets given current gas prices and a
conservative bias means that guidance is for production to be flat in 2011 versus 2010.
January 11, 2011
40 of 86

PENGROWTH ENERGY CORP.
PGF.UN $12.89 PGF $14.00 HOLD
CPFS (Basic + Exch.) $3.87 $3.29 $3.32 $3.54 $2.23 $1.96 $1.89 $1.99
DPS (Basic) $2.78 $3.00 $2.92 $2.70 $1.28 $0.84 $0.84 $0.84
NAVMG - - - - - $14.56 - -
Valuation
Share Price (Avg) $19.03 $23.03 $19.09 $16.92 $9.24 $12.89 $12.89 $12.89
Shares Outstanding (Basic + Exch. - Period End) 159.9 244.0 246.8 256.1 287.9 323.5
$1,202 325.0 326.6
Market Cap ($mm) $3,042 $5,620 $4,712 $4,333 $2,661 $4,170 $4,190 $4,210
Net Debt ($mm) $480 $862 $1,405 $1,790 $1,197 $1,202 $1,239 $1,216
Yield 15% 13% 15% 16% 14% 7% 7% 7%
P/NAV - - - - - 89% - -
P/CF 4.9x 7.0x 5.7x 4.8x 4.1x 6.6x 6.8x 6.5x
EV/DACF 5.5x 10.4x 6.7x 6.2x 5.7x 8.1x 8.0x 7.5x
EV/BOEPD $59,338 $103,192 $69,994 $74,675 $48,516 $71,281 $70,188 $71,177
EV/2PBOE (Pro Forma) $16.05 $21.77 $19.12 $18.93 $13.05 $16.81 - -
Production
Oil & NGLs (bbls/d) 26,891 28,595 35,736 33,731 32,431 31,156 33,876 35,170
Heavy Oil (bbls/d) 5,623 4,963 7,168 8,122 7,551 6,760 6,464 6,698
Gas (mmcf/d) 161.1 175.6 267.0 240.8 237.2 224.7 222.1 206.2
Total BOE/d (6:1) 59,357 62,821 87,401 81,991 79,518 75,360 77,349 76,234
Gas % 45% 47% 51% 49% 50% 50% 48% 45%
PDP 143.7 189.0 202.9 188.3 188.3 193.7 - -
Proved 175.6 225.9 241.2 235.2 216.6 227.8 - -
Proved + Probable 219.4 297.8 319.9 323.5 295.7 319.5 - -
% Proved 80% 76% 75% 73% 73% 71% - -
RLI (Proven) 8.2 10.6 7.7 7.5 7.7 - - -
RLI (P+P) 10.4 10.4 10.4 10.4 10.4 - - -
FD&A + FDC (Proven) $14.42 $30.71 $20.83 $22.11 $14.87 - - -
FD&A +FDC (P+P) $14.47 $23.62 $18.97 $21.14 $59.15 - - -
Growth (Y/Y)
Production Growth
Absolute - 6% 39% (6%) (3%) (5%) 3% (1%)
Per Share - (5%) (0%) (8%) (8%) (17%) (5%) (2%)
Per Share (Debt Adjusted) - (16%) 4% (11%) (23%) 6% (5%) (2%)
P+P Reserve Growth
Absolute - 36% 7% 1% (9%) - - -
Per Share - (11%) 6% (3%) (19%) - - -
Per Share (Debt Adjusted) - (15%) (4%) (8%) (9%) - - -
Netback ($/BOE)
Gross Revenue $56.56 $54.01 $53.18 $70.94 $40.79 $47.02 $50.24 $54.37
Royalties ($9.48) ($10.48) ($10.01) ($14.46) ($7.08) ($9.17) ($9.90) ($10.72)
Operating ($10.07) ($11.80) ($12.74) ($13.95) ($13.13) ($13.15) ($13.60) ($13.60)
Transportation ($0.36) ($0.33) ($0.40) ($0.42) ($0.46) ($0.53) ($0.50) ($0.50)
Hedge Gain/(Loss) ($3.04) ($0.31) $1.44 ($6.47) $5.90 $2.77 $1.62 $0.00
Interest ($1.00) ($1.40) ($2.64) ($2.54) ($2.77) ($2.46) ($2.44) ($2.49)
Cash Taxes ($0.47) ($0.04) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Other Cash Items ($2.12) ($2.50) ($1.40) ($1.05) ($0.94) ($0.80) ($1.20) ($1.22)
Cash Netback $28.39 $25.66 $25.85 $30.42 $20.45 $21.51 $21.73 $23.35
Cash Flow ($mm)
Gross Revenue $1,225 $1,239 $1,697 $2,129 $1,184 $1,293 $1,418 $1,513
Royalties ($205) ($240) ($319) ($434) ($206) ($252) ($279) ($298)
Operating ($218) ($271) ($407) ($418) ($381) ($362) ($384) ($378)
Transportation ($8) ($8) ($13) ($13) ($13) ($15) ($14) ($14)
Hedge Gain/(Loss) ($66) ($7) $46 ($194) $171 $76 $46 $0
Interest ($22) ($32) ($84) ($76) ($80) ($68) ($69) ($69)
Cash Taxes ($10) ($1) $0 $0 $0 $0 $0 $0
Other Cash Items ($46) ($57) ($45) ($31) ($27) ($22) ($34) ($34)
Cash Flow ($mm) $615 $588 $825 $913 $593 $592 $614 $650
US$10.00/bbl ∆ WTI - - - - - - 4% 19%
C$1.00/mcf ∆ AECO - - - - - - 8% 10%
Headging (%)
% Liquids Hedged - - - - - 33% 61% 0%
% Gas Hedged - - - - - 45% 23% 0%
% Hedged - - - - - 39% 43% 0%
Capex & Distributions ($mm)
E&D Capex ($175) ($301) ($310) ($402) ($202) ($350) ($400) ($375)
Net Acquisitions ($141) ($1,840) ($473) ($110) $8 $28 $0 $0
Total Capex ($316) ($2,141) ($783) ($512) ($194) ($322) ($400) ($375)
Distributions ($414) ($517) ($718) ($675) ($334) ($256) ($272) ($274)
DRIP Savings $26 $26 $45 $59 $26 $21 $21 $23
Free Cash Flow (Financing Requirement) ($89) ($2,043) ($631) ($214) $91 $35 ($38) $24
Tax Pools - $0 $5,025 $2,549 $3,088 - - -
Payout Ratio (%)
E&D Capex/CF 29% 51% 38% 44% 34% 59% 65% 58%
Distribution/CF 67% 88% 87% 74% 56% 43% 44% 42%
(Capex+DPS-DRIP)/CF 92% 135% 119% 111% 86% 99% 106% 96%
Debt ($mm)
Bank Debt - - - - $0 $101 $139 $115
Working Capital Deficit - - - - $214 $81 $81 $81
Convertible Debentures & Notes - - - - $982 $1,019 $1,019 $1,019
Net Debt $480 $862 $1,405 $1,790 $1,197 $1,202 $1,239 $1,216
Credit Facility - - - - $1,200 $1,250 $1,250 $1,250
% Drawn - - - - 0% 8% 11% 9%
January 11, 2011
41 of 86

Recommendation: BUY
Unchanged
Risk: HIGH
Unchanged
PetroBakken Energy Ltd.
(PBN-T) C$21.78
Market Data (C$)
PBN - 2011 Capex & Prodn Guidance + Bank Line Increased
52-Wk Range $18.56-$33.57
PetroBakken provided 2011 Capex & Production Guidance & Advises Bank
Dividend Yield 4.4%
Avg. Daily Trading Vol. (3mths) 962710 Line Increased
Financial Data (C$)
Shares O/S (f.d.)(mm) 195.4 Slightly Positive
Net Debt ($mm) $1,705.0
PetroBakken provided details for 2011. We note that providing specific
Estimates (C$)
Year 2009A 2010E 2011E 2012E guidance is uncharacteristic of the company, although it is something we
CFPS (f.d.) 3.13 3.47 4.01 4.61 appreciate and also something we think that may give the market slightly
CFPS (f.d.)(old) -- -- 4.15 -- more confidence regarding its expectations. Given its asset base and active
Debt/CF 2.3x 2.6x 2.4x 2.1x drilling program, frankly forecasting production was a challenge and capex an
Oil (b/d) 22,648 35,414 38,938 38,667
educated guess at best. Management had been indicating that an increase in its
Gas (MMcf/d) 22.1 39.1 34.3 32.6
MBOE/d 26.3 41.9 44.7 44.1 credit facility was both a goal and plausible – yesterday’s announcement puts
numbers to that. Exit production for 2010 is in line with our estimate, while
Valuations
exit 2011 production is lower than previously forecast on slightly lower
Year 2009A 2010E 2011E 2012E
EV/DACF 8.9x 8.0x 7.1x 6.3x
drilling capex. However, the 2011 capex program also includes significant
Yield -- 4.0% 4.0% 4.0% capex directed to undeveloped lands and, as a result, total 2011 capex rises
P/NAV -- 75.0% -- -- about $80 million to $800 million from our previous estimate.
Supplemental Data
Year 2009A 2010A 2011E 2012E Today we are also publishing a sector note Updating 2010E-YE Reserves,
WTI (US$/bbl) $61.97 $79.50 $85.00 $85.00 Activity and Asset Mix – Trust conversions Complete – Looking to 2011. In
NYMEX (US$) $4.16 $4.36 $4.50 $5.25
AECO (C$) $4.00 $3.99 $3.90 $4.65
this sector report we are i) updating our commodity price forecast; ii)
F/X (US$) $0.94 $0.97 $0.99 $0.98 introducing 2012 estimates; iii) estimating year end 2010 reserves and using
this updated reserve estimate in our Net Asset Value analysis (both
Blowdown and Modified Growth).
Using year-end estimated reserves, revised 2011 estimates using

guidance, an unchanged target price methodology and an unchanged
subjective rating of 4 (out of 10) our target price remains unchanged at
$26 and we are maintaining our BUY rating.
PBN-T: Price
PetroBakken Energy Ltd. (PBN) is a
35 35
Canadian oil and natural gas exploration,
development and production company 30 30
focused on the Bakken and Cardium plays.
25 25
The company is the combination of the
Please see the final pages of Canadian Business Unit of Petrobank Energy 20 20
this document for important and Resources Ltd. and TriStar Oil & Gas
15 15
disclosure information. Ltd. Q4 Q1 Q2
2010
Q3 Q4
January 11, 2011
42 of 86

2010A 2011E 2012E
WTI (US$/bbl) $79.50 $85.00 $80.00 $93.23 10% $85.00 $93.94 11%
Edmonton ($/bbl) $76.80 $83.50 $80.90 - - $84.60 - -
NYMEX (US$/mcf) $4.36 $4.50 $5.75 $4.56 1% $5.25 $5.08 -3%
AECO ($/mcf) $3.99 $3.90 $5.10 $3.99 2% $4.65 $4.49 -3%
FX (US$) $0.97 $0.99 $0.97 $1.00 1% $0.98 $0.99 1%
Source: Bloomberg, TD Newcrest
Outlook
Although WTI crude oil prices recently tested levels above US$90/bbl, we are taking a somewhat conservative
view on prices and are estimating a WTI price of US$85/bbl through 2011 and 2012. In our view,
fundamentals for the commodity, including inventories along with the supply and demand balance do not
support current prices.
Looking at natural gas, above-average withdrawals have somewhat reduced the overhang in inventories;
however, seasonal gas inventory levels remain near record highs due to ample supply. Given the continued
oversupply of the commodity, we are now estimating a NYMEX gas price of US$4.50/mcf (previously $5.75)
in 2011 and US$5.25/mcf in 2012. Our new commodity price forecasts are outlined in Exhibit 1.
Key Takeaways From 2011 Guidance

• Capex – The company’s 2011 capex budget of $800 million is higher than previously forecast by TD and
above 2010 capex spending (before acquisitions) estimated at $715 million. Net wells drilled are
expected to be lower, as shown in Exhibit 3, with a trend to more Cardium wells that are higher cost.
• Bakken EOR – Of interest, the company indicated $20 million for EOR in the Bakken, which includes
several injection configurations and fluids (including natural gas). We take this to mean that
waterflooding will also be tested. Given the apparent success of Crescent Point in this regard, this is not
surprising.
• Exit Production – Exit production guidance of 42,500 BOE/d for 2010 is generally in line with our
estimate. For 2011, exit production is guided to 46,000-49,000 BOE/d, which is slightly below our
previous estimate. We highlight the difficulty of forecasting production given the dynamics of an active
drilling program coupled with higher than industry average decline rates.
• Decline Rate– PetroBakken indicated a base 2011 production decline rate of 40%, which is line with our
previously published estimate of a current decline rate of 35%.
• Credit Facility – PetroBakken advised it received a $200 million increase in its credit facility (covenant
based) to $1.2 billion. The facility maturity date remains June 2011. This is consistent with comments by
management on its Q3/10 conference call, when the company stated that an increased lending facility
would likely be pursued. The increase was in line with our expectations.
January 11, 2011
43 of 86
Exhibit 2. 2011 Guidance
PBN TD
New New Old Comments
2011 Capex ($mm) $800 $800 $730 Capex higher than expected on land/seismic
2010 Exit Rate (BOE/d) 42,500 42,327 42,327 Inline with prior estimates
2011 Exit Rate (BOE/d) 46,000 - 49,000 45,395 51,305 Our 2011 exit rate revised downward
Credit Facility ($Billion) $1.2 - - Increased from $1 Billion
Source: Company reports, TD Newcrest
Exhibit 3. 2011 vs. 2010 Drilling Guidance (Net Wells)

2010E (Net) 2011 (Net) Y/Y # Difference Y/Y % Chg.
Bakken 145 75 (70) (48%)
SE Sask (Mississippian) 5 30 25 500%
Cardium 65 95 30 46%
Other 3.1 2 (1) (35%)
Total 218.1 202 (16) (7%)
Valuation
PBN 104% 75% 7.1x 6.3x $133,939 $135,653 $34.32 2.4x 125% 4% 13%
Average 157% 101% 10.2x 8.8x $93,744 $90,489 $25.91 2.1x 122% 5% 53%
>60% Gas 154% 112% 11.9x 9.2x $76,205 $68,787 $23.48 3.0x 135% 2% 78%
>60% Oil 168% 100% 9.6x 9.2x $127,358 $127,682 $32.73 1.3x 110% 6% 26%
Yield 159% 98% 9.6x 8.6x $93,236 $92,893 $24.16 2.1x 118% 5% 49%
No Yield 148% 115% 13.0x 9.8x $95,901 $80,269 $33.37 2.1x 141% 0% 70%
Exhibit 4. Cash Flow Sensitivities

CFPS (f.d.) - 2011E (FX fixed at $0.99) Net Debt to Cash Flow - 2011E
WTI (US$/Bbl) WTI (US$/Bbl)

$5.51 $62.50 $72.50 $82.50 $92.50 $102.50 $0.52 $62.50 $72.50 $82.50 $92.50 $102.50
AECO (C$/Mcf)
AECO (C$/Mcf)
$1.90 $2.82 $3.29 $3.89 $4.51 $5.04 $1.90 3.9x 3.2x 2.5x 2.1x 1.7x
$2.90 $2.87 $3.35 $3.95 $4.56 $5.10 $2.90 3.8x 3.1x 2.5x 2.0x 1.7x
$3.90 $2.93 $3.41 $4.01 $4.62 $5.16 $3.90 3.7x 3.0x 2.4x 2.0x 1.7x
$4.90 $2.99 $3.46 $4.06 $4.68 $5.21 $4.90 3.6x 3.0x 2.4x 1.9x 1.6x
$5.90 $3.04 $3.52 $4.12 $4.73 $5.27 $5.90 3.5x 2.9x 2.3x 1.9x 1.6x
Source: TD Newcrest

then adjusted by a subjective factor of -5% (within a range of +/- 25% for the sector).

royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to
January 11, 2011
44 of 86
PetroBakken include the impact of high first year decline rates on Bakken horizontal wells and variability in IP
rates for Cardium horizontal wells.
The company’s December, 2010 update highlighted its improving success with the development of its
Cardium assets. Of note – IP rates were better than expected, activity is picking up in terms of wells drilled,
waiting for tie-in and licensed. Not to be overlooked, the use of water based frac fluids should result in lower
well costs in this play and PetroBakken is the first company to provide specific IP rate details for wells
completed in this manner. High organic decline rates for the company’s current assets (largely Bakken and
Mississippian light oil in Saskatchewan) mean that successful and timely drilling is key to its previously stated
growth model.
January 11, 2011
45 of 86

PETROBAKKEN ENERGY LTD.
PBN $21.78 PBN $26.00 BUY
CFPS (fd) - - - - $3.13 $3.47 $4.01 $4.61
DPS (Basic) - - - - - $0.96 $0.96 $0.96
NAVMG - - - - - $29.12 $0.24 $0.24
Valuation
Share Price (Avg) - - - - $16.16 $21.78 $21.78 $21.78
Shares Outstanding (Basic - Period End) - - - - 171.9 187.3 187.3 187.3
Market Cap ($mm) - - - - $2,777 $4,080 $4,080 $4,080
Net Debt ($mm) - - - - $902 $1,705 $1,902 $1,902
Enterprise Value ($mm) - - - - $3,679 $5,785 $5,982 $5,982
Yield - - - - - 4% 4% 4%
P/NAV - - - - - 75% - -
P/CF - - - - 5.2x 6.3x 5.4x 4.7x
EV/DACF - - - - 8.9x 8.0x 7.1x 6.3x
EV/BOEPD - - - - $139,715 $137,930 $133,939 $135,653
EV/2PBOE (Pro Forma) - - - - $25.61 $34.32 - -
Production
Oil & NGLs (bbls/d) - - - - 22,648 35,414 38,938 38,667
Heavy Oil (bbls/d) - - - - - - - -
Gas (mmcf/d) - - - - 22.1 39.1 34.3 32.6
Total BOE/d (6:1) - - - - 26,333 41,939 44,661 44,095
Gas % - - - - 14% 16% 13% 12%
PDP - - - - 59.4 70.9 - -
Proved - - - - 89.4 106.1 - -
Proved + Probable - - - - 143.6 168.5 - -
% Proved - - - - 62% 63% - -
RLI & Capital Efficiency - - - -
RLI (Proven) - - - - 5.4 - - -
RLI (P+P) - - - - 8.6 - - -
FD&A + FDC (Proven) - - - - $12.83 - - -
FD&A +FDC (P+P) - - - - $11.24 - - -
Recycle Ratio (Proven) - - - - 3.2x - - -
Recycle Ratio (P+P) - - - - 3.7x - - -
Growth
Production Growth
Absolute - - - - - 59% 6% (1%)
Per Share - - - - - 8% 5% (1%)
Per Share (Debt Adjusted) - - - - - (6%) 0% (3%)
P+P Reserve Growth - - - - -
Absolute - - - - - - - -
Per Share - - - - - - - -
Per Share (Debt Adjusted) - - - - - - - -
Netback ($/BOE)
Gross Revenue - - - - $59.91 $66.14 $73.24 $81.37
Royalties - - - - ($8.55) ($9.24) ($10.25) ($11.39)
Operating - - - - ($7.38) ($7.94) ($8.15) ($8.15)
Transportation - - - - ($0.92) ($0.97) ($0.85) ($0.80)
Operating Netback - - - - $43.06 $48.00 $53.99 $61.02
Hedge Gain/(Loss) - - - - $2.49 $0.08 $0.13 $0.00
General & Administration - - - - ($1.59) ($2.21) ($2.18) ($2.31)
Interest - - - - ($1.95) ($4.44) ($3.94) ($2.78)
Cash Taxes - - - - $0.00 $0.00 $0.00 $0.00
Other Cash Items - - - - ($0.95) $1.32 $0.00 $0.00
Cash Netback - - - - $41.08 $42.76 $48.00 $55.93
Cash Costs (Ex. Hedging) - - - - ($21.32) ($23.46) ($25.37) ($25.44)
Cash Flow ($mm)
Gross Revenue - - - - $576 $1,012 $1,194 $1,310
Royalties - - - - ($82) ($141) ($167) ($183)
Operating - - - - ($71) ($122) ($133) ($131)
Transportation - - - - ($9) ($15) ($14) ($13)
Hedge Gain/(Loss) - - - - $24 $1 $2 $0
General & Administration - - - - ($15) ($34) ($35) ($37)
Interest - - - - ($19) ($68) ($64) ($45)
Cash Taxes - - - - $0 $0 $0 $0
Other Cash Items - - - - ($9) $20 $0 $0
Cash Flow ($mm) - - - - $395 $655 $783 $900
US$10.00/bbl ∆ WTI - - - - - - 15% 15%
C$1.00/mcf ∆ AECO - - - - - - 1% 1%
Hedging (%)
% Liquids Hedged - - - - - 28% 19% 0%
% Gas Hedged - - - - - 20% 7% 0%
% Hedged - - - - - 27% 18% 0%
E&D Capex - - - - ($386) ($715) ($800) ($720)
Net Acquisitions - - - - $406 ($353) $0 $0
Total Capex - - - - $20 ($1,068) ($800) ($720)
Dividend - - - - ($27) ($177) ($180) ($180)
DRIP Savings - - - - $0 $0 $0 $0
Free Cash Flow (Financing Requirement) - - - - $387 ($590) ($197) $0
Tax Pools - - - - $1,776 - - -
Payout Ratio
E&D Capex/CF - - - - 98% 109% 102% 80%
Dividend/CF - - - - 7% 27% 23% 20%
(Capex+DPS-DRIP)/CF - - - - 105% 136% 125% 100%
Debt ($mm)
Bank Debt - - - - $748 $785 $984 $996
Working Capital Deficit - - - - $154 $139 $138 $126
Convertibles & Notes - - - - - $780 $780 $780
Net Debt - - - - $902 $1,705 $1,902 $1,902
Net Debt/Cash Flow - - - - 2.3x 2.6x 2.4x 2.1x
Credit Facility - - - - $1,025 $1,000 $1,200 $1,200
% Drawn - - - - 73% 79% 82% 83%
January 11, 2011
46 of 86
Financial Services - Diversified Doug Young, CFA Graham Ryding

Financials
Unchanged
Risk: MEDIUM
TMX Group Inc.
(X-T) C$37.19
Prior: C$35.00
December Stats: Solid Trading & Financing Activity
Market Data (C$)
52-Wk Range $26.78-$38.13 Event – December TMX Group (TMX) Trading & Financing Stats Released
Mkt Cap (f.d.)($mm) $2,793.0
Impact – Positive: We Raised our Estimates and Target Price to $38
Dividend Yield 4.3% TMX’s stats in December were strong across the board (see Exhibit 1).
Avg. Daily Trading Vol. (3mths) 277672 Trading volumes were higher than expected on the TSX Senior Exchange
Financial Data (C$) (SE), TSX Venture Exchange (VE), and the Montreal Exchange (MXX). The
Fiscal Y-E December amount raised by listed issuers was the highest since September-09; and there
Shares O/S (basic)(mm) 74.3 were a greater number of smaller deals, which is optimal for TMX.
Net Debt/Tot Cap 11.4% We raised our Q4/10 estimates on the back of this quarter’s strong stats.
Estimates (C$) We also adjusted our 2011 and 2012 estimates to reflect 1) higher annual
Year 2009A 2010E 2011E 2012E sustaining listing fees (based on year-end market caps of listed issuers)
EBITDA ($mm) 330.8 368.8 384.7 390.7 and 2) higher VE trading volumes. As a result our target price moves up
EBITDA/Shr 4.45 4.93 5.19 5.42
to $38 (from $35), but we are maintaining our HOLD rating. We give
EPS (f.d.) 2.74 3.10 3.23 3.35
EPS (f.d.)(old) -- 3.04 3.10 3.28
TMX credit for diversifying its revenue base, its strong listings business, and
its attractive cash flow and dividend yield. However we believe competition
EPS (f.d.) Quarterly Estimates (C$)
Year 2009A 2010E 2011E 2012E on its legacy businesses could limit growth over the coming year.
Q1 0.59 0.75 0.82 0.82
Q2 0.69 0.76 0.82 0.86 Highlights for December:
Q3 0.62 0.72 0.73 0.76 • TSX equity trading volumes: Consolidated volumes increased 38% y/y
Q4 0.84 0.87 0.85 0.90
in December, and 25% y/y in Q4/10. TSX’s share of non-block trading
Valuations
was 64% in December, in line with its 2010 range (64% - 68%). Alpha
Year 2009A 2010E 2011E 2012E
P/E (f.d.) 13.6x 12.0x 11.5x 11.1x
captured 24% and Chi-X 8% of trading volumes in December.
Notes: EPS / EBITDA reflect listing fees on a received basis.
• Value of new financings: The value of equity financing was up 113%
All figures in C$, unless otherwise specified. y/y in December and 11% y/y for Q4/10. IPO activity in Q4/10 in
particular was strong – the amount raised increased 150% y/y.
• NGX: Energy trading volume (natural gas, oil, and electricity in

terajoules units) was up 14% y/y in December and 12% y/y for Q4/10.
• Montreal Exchange (MXX): While down slightly from November,

volumes were up 36% y/y in December and 19% y/y for Q4/10.
X-T: Price
The TMX Group is a holding company that 45 45
owns Canada's two primary stock exchanges
40 40
and the Montreal Exchange, which forms the
third largest exchange in North America, and 35 35
seventh in the world (based on market cap of 30 30

Please see the final pages of listed issuers). TMX Group went public in 25 25
this document for important Nov/02, raising $341.6 million ($9 per share)
20 20
disclosure information. for selling shareholders in the IPO. 2008 2009 2010
January 11, 2011
47 of 86
• BOX: Volumes were up 83% y/y in December and 39% y/y for Q4/10. Its U.S. market share was 2.5%
vs. 1.9% in December, 2009.
Income Trust Conversion – Could Boost TMX’s EPS by $0.05-0.06 in Q1/11
Every month we focus on a theme. This month’s topic is conversions of income trusts back to corporations, a
popular topic lately, and one that has positive implications for TMX. Regardless of size TMX charges $50,000
every time an income trust converts back to a corporation. This is captured in listing fees. Based on our math,
by multiplying the number of issuers converting by $50,000 and applying a 32% tax rate, we derive a $0.05-
$0.06 EPS impact. A majority of this will flow through in Q1/11. We have factored this into our estimates.
Details
Exhibit 1. Key Stats for TMX Exchanges: December 2010
TSX Exchanges: Dec Nov Dec M/M Y/Y Y/Y Montreal Exchange (MXX) Dec Nov Dec M/M Y/Y Y/Y
TSX Senior Exchange (SE) 2009 2010 2010 (%) (%) Q4/09 Q4/10 (%) Futures Volumes ('000s) 2009 2010 2010 (%) (%) Q4/09 Q4/10 (%)
Volume traded (bln) 8.2 10.9 9.7 -11% 18% 27.2 29.5 9% BAX - Cdn Bankers' Acceptance 800 1,303 904 -31% 13% 2,681 3,173 18%
Value traded ($bln) $106.9 $133.5 $126.9 -5% 19% $335.6 $368.7 10% CGB - 10 Year Cdn Govt Bonds 404 774 492 -36% 22% 1,419 1,617 14%
Value of New Financings ($bln) $3.2 $4.5 $8.0 79% 146% $15.5 $16.3 5% SXF - S&P Canada 60 Index 436 249 444 78% 2% 1,011 885 -12%
Number of IPO's 4 12 21 75% 425% 24 39 63% Equity Derivatives 2 1,293 2,027 2,125 5% 64% 4,609 5,930 29%
Number of New Issuers 20 18 32 78% 60% 47 62 32% All contracts 2,952 4,381 4,005 -9% 36% 9,825 11,720 19%
TSX Venture Exchange (VE) Futures Open Interest ('000s)
Volume traded (b) 4.7 8.1 8.1 1% 74% 15.3 23.3 53% All contracts 2,770 3,402 3,592 6% 30% 2,770 3,592 30%
Value traded ($bln) $2.1 $4.6 $4.6 0% 123% $6.7 $13.4 102%
Value of New Financings ($bln) $0.9 $1.5 $1.7 14% 88% $2.7 $4.0 48% NGX ('000s)
Number of New Listings 16 19 25 32% 56% 41 58 41% Total Energy Volume (Terajoules) 1,137 1,472 1,299 -12% 14% 3,741 4,178 12%
TSX (Consolidated)
Volume traded (b) 12.9 19.0 17.8 -6% 38% 42.4 52.9 25% Boston Options Exchange (BOX)
Value traded ($bln) $109.0 $138.1 $131.5 -5% 21% $342.3 $382.1 12% Volume ('000s) 4,820 8,180 8,801 8% 83% 18,686 25,911 39%
Value of New Financings ($b) $4.2 $6.0 $9.7 62% 133% $18.3 $20.3 11% Average Daily Volume ('000s) 254 390 419 8% 65% 295 405 37%
U.S. Options Market Share 1.9% 2.4% 2.5% 0.1% 0.6% 2.2% 2.5% 0.3%
Canadian Equity Market - Consolidated
Volume traded (b) 17.0 26.4 24.8 -6% 46% 54.0 73.1 36%
2
Equity Derivatives volumes include ETF options
Source: Company Reports, IIROC, Canadaequity.com, TD Newcrest Estimates
Exhibit 2. TSX vs. Canadian Alternative Trading Systems (ATS) – Equity Trading Market Share (%)
Market Share (Excluding Block Trading) Market Share (Including Block Trading)
Month Alpha Pure Chi-X TSX Month Alpha Pure Chi-X TSX
Dec-09 22.3% 0.9% 6.1% 69.5% Dec-09 17.4% 2.0% 3.5% 75.9%
Jan-10 24.8% 0.9% 5.8% 67.4% Jan-10 19.7% 1.8% 3.4% 73.9%
Feb-10 26.1% 0.6% 6.8% 65.4% Feb-10 21.0% 1.6% 4.1% 71.9%
Mar-10 26.5% 0.4% 6.1% 65.8% Mar-10 20.8% 1.4% 3.5% 73.1%
Apr-10 27.1% 0.4% 5.9% 65.1% Apr-10 21.3% 1.2% 3.7% 72.5%
May-10 23.1% 1.1% 8.3% 67.4% May-10 19.6% 1.0% 5.3% 72.7%
Jun-10 25.2% 1.1% 6.4% 66.6% Jun-10 18.6% 2.1% 5.2% 72.2%
Jul-10 24.1% 1.8% 8.9% 64.5% Jul-10 19.5% 3.1% 5.0% 70.3%
Aug-10 21.8% 1.7% 7.4% 68.3% Aug-10 18.8% 2.8% 4.7% 72.1%
Sep-10 21.9% 2.1% 7.7% 66.3% Sep-10 16.9% 2.3% 4.1% 74.9%
Oct-10 22.7% 2.3% 8.5% 64.1% Oct-10 17.6% 2.6% 4.5% 73.3%
Nov-10 23.3% 2.7% 7.9% 64.6% Nov-10 20.1% 4.1% 4.7% 69.9%
Dec-10 23.7% 2.9% 7.9% 64.3% Dec-10 20.5% 3.7% 4.7% 70.4%
Source: Bloomberg, IIROC, TD Newcrest
Outlook
Exhibit 3 includes our old and new estimates, and there a few noteworthy items:
• For 2011 and 2012 we only include our estimates that account for listing fees on a received basis. Under
the adoption of IFRS, starting in Q1/11, listing fees will no longer be capitalized and amortized.
• The revisions to our 2011 and 2012 estimates reflect higher VE trading volumes and sustaining listing
fees (an annual fee based on a listed issuers’ prior year-end market capitalization, subject to caps).
• We forecast EPS growth of 4% in 2011 and 2012. If we eliminate our stock buyback assumptions (500k
shares per quarter), y/y EPS growth declines to 3% in 2011 and 1% in 2012.
January 11, 2011
48 of 86
Exhibit 3. TMX: Old and New Q4/10 and 2010 - 2012 Estimates
Q4/10E 2010E 2011E 2012E
OLD New Old New Old New Old New
1 1 1 1
GAAP Cash GAAP Cash GAAP Cash GAAP Cash Cash 1 Cash 1 Cash 1 Cash 1
Revenue $147 $159 $150 $166 $571 $611 $574 $617 $628 $643 $651 $660
2
EBITDA $84 $97 $87 $103 $322 $362 $326 $369 $372 $385 $386 $391
Per Share $1.12 $1.29 $1.16 $1.38 $4.31 $4.85 $4.36 $4.93 $5.03 $5.19 $5.35 $5.42
Margin 57% 61% 58% 62% 56% 59% 57% 60% 59% 60% 59% 59%
EPS (f.d.) $0.69 $0.81 $0.72 $0.87 $2.67 $3.04 $2.70 $3.10 $3.10 $3.23 $3.28 $3.35
1
Listing fees accounted for on a received basis. TMX will begin reporting earnings under this method in 2011 under IFRS accounting.
2
EBITDA ex investment income
Source: Company reports, TD Newcrest Estimates
Valuation
Exhibit 4. TMX Group: Historical EV / EBITDA Multiples (EBITDA on a four-quarter forward basis)
14x
EV / EBITDA (4QF)
12x
10x
8x
Min = 4.4x
With Listing Fees Max = 11.8x
6x
accounted for on Avg = 8.2x
a received basis. Current = 7.8x
4x
2x
Dec-02
Dec-03
Dec-04
Dec-05
Dec-06
Dec-07
Dec-08
Dec-09
Dec-10
Mar-03
Jun-03
Sep-03
Mar-04
Jun-04
Sep-04
Mar-05
Jun-05
Sep-05
Mar-06
Jun-06
Sep-06
Mar-07
Jun-07
Sep-07
Mar-08
Jun-08
Sep-08
Mar-09
Jun-09
Sep-09
Mar-10
Jun-10
Sep-10
4QF EBITDA ex investment income
Source. Thomson One, TD Newcrest., Company Reports EV / EBITDA (4QF) Avg EV/EBITDA (4QF)
Exhibit 5. TMX Group: Comp Table

1 2
Div Mkt. Cap P/EPS EV / EBITDA
Company Ticker Currency Price Yield ($mm) LTM 2010E 2011E 2012E LTM 2010E 2011E 2012E
TMX Group Inc. (listing fees on received basis) X-T CDN $37.07 4.3% $2,756 12.1x 12.0x 11.5x 11.1x 8.1x 8.0x 7.7x 7.5x
Compared to International Exchanges

Australian Securities Exchange Ltd. ASX-AU AUD $37.60 6.5% $6,526 19.3x 19.2x 16.7x 16.5x 13.4x 13.0x 11.2x 11.0x
Deutsche Boerse AG DB1-XE EUR € 52.30 3.9% € 9,725 15.0x 15.7x 11.8x 10.4x 10.4x 9.2x 7.9x 7.1x
Hong Kong Exchanges & Clearing Ltd. 388-HK HKD $182.30 2.2% $196,273 41.7x 39.2x 31.0x 27.2x 32.8x 29.8x 23.1x 20.9x
London Stock Exchange PLC LSE-LN GBP £8.63 3.1% £2,338 17.6x 13.5x 12.1x 11.2x 7.4x 7.7x 7.4x 7.1x
Singapore Exchange Limited SGX-SP SGD $8.46 3.2% $9,062 30.5x 29.2x 19.2x 16.9x 21.5x 18.7x 14.2x 11.8x
BM&F Bovespa SA BVMF3-BZ BRL R$ 12.99 3.7% R$ 25,921 23.6x 19.1x 16.7x 13.5x 18.7x 18.1x 15.9x 13.0x
Bolsas y Mercados Espanoles SA BME-SM EUR € 17.69 9.0% € 1,479 9.8x 9.7x 10.4x 11.3x 5.2x 5.2x 5.5x 6.0x
Average 3.8% 22.5x 20.8x 16.9x 15.3x 15.6x 14.5x 12.2x 11.0x
3
U.S. Exchanges
Nasdaq Stock Market Inc. (The) NDAQ-O USD $23.40 n.a $4,629 12.3x 12.1x 9.9x 8.9x 7.8x 7.9x 7.1x 6.4x
NYSE Euronext NYX-N USD $30.68 3.9% $8,007 13.6x 14.8x 12.1x 10.4x 9.1x 9.4x 8.0x 7.0x
Average, ex TSX Group Inc. n.a 12.9x 13.4x 11.0x 9.6x 8.4x 8.7x 7.5x 6.7x
Derivative Exchanges
Chicago Mercantile Exchange Holdings Inc. CME-US USD $315.99 1.5% $21,108 21.4x 20.4x 18.4x 16.1x 11.8x 11.0x 10.0x 9.1x
Intercontinental Exchange ICE-N USD $114.68 n.a $8,388 22.1x 20.4x 18.0x 15.8x 11.8x 11.0x 9.5x 8.5x
CBOE Holdings Inc. CBOE-US USD $23.81 1.7% $2,431 na 22.9x 16.1x 14.0x na 10.4x 8.1x 7.1x
Average n.a 21.8x 21.2x 17.5x 15.3x 11.8x 10.8x 9.2x 8.3x
Source: TD Newcrest, Thomson One, and Bloomberg.

1
Our enterprise value consists of debt, minus unrestricted cash and marketable securities.
2
EBITDA excludes investment, financing, or other non-operating income.
3
TMX Group earnings reflect listing fees on a received basis under IFRS accounting. Nasdaq and NYSE's listing fees are amortized over a set period under U.S. GAAP.
January 11, 2011
49 of 86

To derive our one-year out price target we apply 7.0 to 7.5x (unchanged) to our four-quarter forward EBITDA
estimate, then subtract net debt and divide by the shares outstanding. This is below its historical average of
9.8x (EV / to four-quarter trailing EBITDA basis) but justified we believe given the competitive landscape.

(1) New entrants into the Canadian market; (2) Outflow of trading volumes to competing platforms; (3) Higher
expenses from new initiatives; (4) Potential for technology strains; (5) Severe equity market downturn and / or
increased volatility; (6) Lower trading volumes / financing activity / market data subscriptions; (7) Inability to
keep key members of the current management team, (8) Market data fee regulation.
Our HOLD rating reflects our mixed view on TMX’s outlook. On a positive note, we expect further trading
volume growth on the TSX VE and MXX in 2011. It is well positioned to benefit from an uptick in financing
activity, especially in the commodity sectors. And TMX generates attractive free cash flows that may go
towards dividend increases or stock buybacks. We are however, concerned that regulatory developments
could negatively impact its market data business; if nothing else we believe it has limited pricing power over a
portion of this business. We expect Alpha to receive regulatory approval to become an exchange, and for it to
enter the listings business. While we believe Alpha may struggle to steal away big listed issuers from TMX,
its entry could remove pricing power in this segment, and result in headline risk. Lastly, we see limited growth
over the next year. We believe TMX’s valuation is fair, and are maintaining our HOLD rating.
See Exhibit 6 below for a detailed overview of our financial estimates and assumptions (2010 – 2012).
Exhibit 6. TMX: Financials Overview

1 1
2010E 2011E 2012E Supplementary Info on Trading and Listing
(in 000's except per share amounts) GAAP % Cash % Cash % Cash %
Income Statement 2010E
Listing Fees $162,429 28% $205,650 33% $218,386 34% $224,161 34% Trading Listing
Trading and Related Fees $240,937 42% $240,937 39% $248,374 39% $256,032 39% Equity $90,900 15% IPO $27,050 13%
Market Data Fees $153,992 27% $153,992 25% $157,817 25% $160,998 24% Derv $82,696 13% Add $101,100 49%
Business Services $16,854 3% $16,854 3% $18,000 3% $19,000 3% NGX $46,658 8% Sust $64,700 31%
Revenues $574,212 $617,433 $642,577 $660,191 Shorcan $20,800 3% Other $12,800 6%
Expenses $250,172 $250,172 $258,368 $269,979 $241,054 $205,650
Income From Operations (EBITDA) $324,039 $367,261 $384,209 $390,212 2011E
Amortization $32,368 $32,368 $33,500 $35,500 Trading Listing
Income From Ops. After Amortization $291,671 $334,893 $350,709 $354,712 Equity $79,406 12% IPO $25,068 11%
Gain (Loss) on Investment in Affiliate $1,035 $1,035 $520 $520 Derv $91,851 14% Add $109,250 50%
Interest Expense ($5,755) ($5,755) ($10,207) ($14,238) NGX $55,317 9% Sust $71,068 33%
Investment Income $6,897 $6,897 $11,607 $14,644 Shorcan $21,800 3% Other $13,000 6%
Restructuring / other expenses ($266) ($266) $0 $0 $248,374 $218,386
Income (Loss) Before Income Taxes $293,583 $337,070 $352,629 $355,638
One-Time Items 2012E
Income Taxes $92,361 $106,081 $113,547 $114,516 Trading Listing
Income Tax Rate 31% 31% 32% 32% Equity $67,495 10% IPO $26,321 12%
Non-Controlling Interests ($495) ($495) $0 $0 Derv $106,061 16% Add $110,996 50%
Net Income (Loss) $201,716 $231,484 $239,082 $241,123 NGX $59,877 9% Sust $72,845 32%
FD Weight Avg S/O 74,746 74,746 74,093 72,093 Shorcan $22,600 3% Other $14,000 6%
EPS - Fully Diluted $2.70 $3.10 $3.23 $3.34 $256,032 $224,161
Net Margin 35% 37% 37% 37%
EBITDA $331,972 $375,193 $396,336 $405,376

EBITDA, ex Investment Income $325,569 $368,791 $384,729 $390,732
Per share, ex Investment Income $4.36 $4.93 $5.19 $5.42
EBITDA Margin, Ex Investment Income 57% 60% 60% 59%
Payout ratio (FCF) 45% 45% 45% 47%
Assumptions
TSX Senior Exchange Vol Growth -12% 0% 0%
TSX Venture Exchange Vol Growth 45% 23% 0%
Montreal Exchange Vol Growth 27% 7% 8%
Balance Sheet Summary
Cash / Marketable Sec. $321,735 $389,249 $451,342
Debt $429,569 $429,569 $429,569
Shareholder's Equity $857,459 $1,214,537 $1,256,551 $1,298,087
Book Value Per Share $11.53 $16.34 $17.37 $18.46
Shares Bought Back 0 2,000 2,000
.@ Average Cost of $31.25 $38.00 $38.00
ROE 24.8% 19.9% 19.4% 18.9%
1
In 2011 / 2012 under IFRS accounting TMX will account for listing fees on a received basis (or what we refer to as a "cash" basis).
Source: TD Newcrest, Company Reports
January 11, 2011
50 of 86
See Exhibits 7-13 for key historical stats for TSX, MXX, and BOX.
Historical Stats: TSX Exchanges
Exhibit 7. TSX Exchanges (SE + VE): Volume Traded (b)
20
18 8-Year CAGRs:
16 Senior Exchange: 10.7%
14 Venture Exchange: 29.2%
Volume (b)
12 Consolidated: 15.3%
10 (Based on LTM stats)
8
6
4
2
0
Jan-01
Apr-01
Jul-01
Oct-01
Jan-02
Apr-02
Jul-02
Oct-02
Jan-03
Apr-03
Jul-03
Oct-03
Jan-04
Apr-04
Jul-04
Oct-04
Jan-05
Apr-05
Jul-05
Oct-05
Jan-06
Apr-06
Jul-06
Oct-06
Jan-07
Apr-07
Jul-07
Oct-07
Jan-08
Apr-08
Jul-08
Oct-08
Jan-09
Apr-09
Jul-09
Oct-09
Jan-10
Apr-10
Jul-10
Oct-10
Source: TMX
Senior Exchange Venture Exchange Consolidated
Exhibit 8. TSX Exchanges (SE + VE): Total Financing Raised ($b)
$12.0 8-Year CAGRs:

Senior Exchange: 6.9%
Senior Exchange ($b)
Venture Exchange ($b)

Venture Exchange: 26.7% $1.5
$9.0 Consolidated: 8.9%
(Based on LTM stats) $1.2
$6.0 $0.9
$0.6
$3.0
$0.3
$0.0 $0.0
May-01
May-02
May-03
May-04
May-05
May-06
May-07
May-08
May-09
May-10
Jan-01
Sep-01
Jan-02
Sep-02
Jan-03
Sep-03
Jan-04
Sep-04
Jan-05
Sep-05
Jan-06
Sep-06
Jan-07
Sep-07
Jan-08
Sep-08
Jan-09
Sep-09
Jan-10
Source: TMX SE (LHS) SE (LTM Average, LHS) VE (LTM Average, RHS) VE (RHS) Sep-10
Exhibit 9. TSX Exchanges (SE + VE): New Issuers Listed (#)

Number of New Issuers / Listings
60
55
50
45
40
35
30
25
20
15
10
5
0
Jul-09
Jan-02
Apr-02
Jul-02
Jul-03
Oct-02
Jan-03
Apr-03
Oct-03
Jan-04
Apr-04
Jul-04
Jul-05
Jul-07
Oct-04
Jan-05
Apr-05
Oct-05
Jan-06
Apr-06
Jul-06
Oct-06
Jan-07
Apr-07
Oct-07
Jan-08
Apr-08
Jul-08
Oct-08
Jan-09
Apr-09
Oct-09
Jan-10
Apr-10
Jul-10
Oct-10
Source: TMX Senior Exchange Venture Exchange Consolidated

January 11, 2011
51 of 86
Exhibit 10. MXX: All Contracts (mm)

Volume Traded Open Interest
5.0 4.0
4.5 3.5
8-Year CAGR: 14.8% 8-Year CAGR: 14.9%
4.0 (Based on LTM stats) (Based on LTM averages)
3.0
3.5
3.0 2.5
2.5 2.0
2.0 1.5
1.5
1.0
1.0
0.5 0.5
0.0 0.0
May-01
May-02
May-03
May-04
May-05
May-06
May-07
May-08
May-09
May-10
Jan-01
Jan-07
Jan-09
Sep-01
Jan-02
Sep-02
Jan-03
Sep-03
Jan-04
Sep-04
Jan-05
Sep-05
Jan-06
Sep-06
Sep-07
Jan-08
Sep-08
Sep-09
Jan-10
Sep-10
May-01
May-02
May-03
May-04
May-05
May-06
May-07
May-08
May-09
May-10
Jan-01
Sep-01
Jan-02
Sep-02
Jan-03
Sep-03
Jan-04
Sep-04
Jan-05
Sep-05
Jan-06
Sep-06
Jan-07
Sep-07
Jan-08
Sep-08
Jan-09
Sep-09
Jan-10
Sep-10
Source: Montreal Exchange Monthly Total LTM Average Source: Montreal Exchange Monthly Total LTM Average
Exhibit 11. MXX: Interest Rate Derivative Contracts (mm)

3.5 1.4
3.0 1.2
2.5 (Based on LTM stats) 1.0 (Based on LTM averages)
2.0 0.8
1.5 0.6
1.0 0.4
0.5 0.2
0.0 0.0
May-01
May-02
May-03
May-04
May-05
May-06
May-07
May-08
May-09
May-10
Jan-01
Sep-01
Jan-02
Sep-02
Jan-03
Sep-03
Jan-04
Sep-04
Jan-05
Sep-05
Jan-06
Sep-06
Jan-07
Sep-07
Jan-08
Sep-08
Jan-09
Sep-09
Jan-10
Sep-10
May-01
May-02
May-03
May-04
May-05
May-06
May-07
May-08
May-09
May-10
Jan-01
Sep-01
Jan-02
Sep-02
Jan-03
Sep-03
Jan-04
Sep-04
Jan-05
Sep-05
Jan-06
Sep-06
Jan-07
Sep-07
Jan-08
Sep-08
Jan-09
Sep-09
Jan-10
Sep-10
Source: Montreal Exchange Monthly Total LTM Average Source: Montreal Exchange Monthly Figure LTM Average
Exhibit 12. MXX: Equity Derivatives (Equity and ETF Options) (mm)
2.5 3.5
3.0
2.0 (Based on LTM stats) (Based on LTM averages)
2.5
1.5
2.0
1.0 1.5
1.0
0.5
0.5
0.0 0.0
May-01
May-02
May-03
May-04
May-05
May-06
May-07
May-08
May-09
May-10
Jan-01
Sep-01
Jan-02
Sep-02
Jan-03
Sep-03
Jan-04
Sep-04
Jan-05
Sep-05
Jan-06
Sep-06
Jan-07
Sep-07
Jan-08
Sep-08
Jan-09
Sep-09
Jan-10
Sep-10
May-01
May-02
May-03
May-04
May-05
May-06
May-07
May-08
May-09
May-10
Jan-01
Sep-01
Jan-02
Sep-02
Jan-03
Sep-03
Jan-04
Sep-04
Jan-05
Sep-05
Jan-06
Sep-06
Jan-07
Sep-07
Jan-08
Sep-08
Jan-09
Sep-09
Jan-10
Sep-10
Source: Montreal Exchange Monthly Total LTM Average Source: Montreal Exchange Monthly Total LTM Average
Exhibit 13. BOX: Monthly Volume (mm) and U.S. Options Market Share (%)
25
6% 5.5%
BOX Options Market Share - U.S.
BOX Monthly Volume (millions) 5.5%
5.1%
20 5% 4.6%
4.4%
4.0% 4.0%
Percentage (%)
4% 3.7%
15
3.0% 3.0% 2.8% 2.6%
3% 2.7% 2.7% 2.7% 2.5%
2.4%
2.2%
10 1.9% 2.0%
1.9%
1.8% 1.8%
2% 1.7%
5 1%
0%
0
May-09
May-10
Mar-09
Nov-09
Mar-10
Nov-10
Jan-09
Jul-09
Sep-09
Jan-10
Jul-10
Sep-10
May-07
May-08
May-09
May-10
Mar-07
Mar-08
Mar-09
Mar-10
Jan-07
Jul-07
Sep-07
Nov-07
Jan-08
Jul-08
Sep-08
Nov-08
Jan-09
Jul-09
Sep-09
Nov-09
Jan-10
Jul-10
Sep-10
Nov-10
Source: Boston Options Exchange Source: Options Clearing Corp.

Volume 3 per. Mov. Avg. (Volume)
January 11, 2011
52 of 86
Unconventional
Prior: BUY
Risk: HIGH
Talisman Energy Inc.
(TLM-T, TLM-N) C$22.20
Prior: C$24.00
Positive Long-term Outlook Unchanged - Downgrading on
Market Data (C$)
Current Price $22.20 Valuation
52-Wk Range $15.71-$22.50
Mkt Cap (f.d.)($mm) $23,698.5
Event
EV ($mm) $25,400.9 We are downgrading Talisman Energy Inc. (TLM-T) to HOLD from Buy this
Dividend per Share $0.25 morning on the basis of valuation. The long-term fundamental outlook for the
Dividend Yield 1.1% company remains unchanged.
Avg. Daily Trading Vol. (3mths) 2,193,082
Financial Data (C$)
Fiscal Y-E December
Impact
Shares O/S (f.d.)(mm) 1,067.5 Neutral.
Shares O/S (basic)(mm) 1,016.8
Details
Net Debt ($mm) $2,829.0
Net Debt/Tot Cap 19.9% Increasing target price on the back of revisions to forecasted commodity
prices: We are issuing our downgrade in conjunction with the release of our
Estimates (C$)
Year 2009A 2010E 2011E 2012E
revised outlook on the commodities. To summarize, we are expecting
CFPS (f.d.) 3.79 2.92 3.78 4.28 increased weakness in natural gas in the near-term (2011) and an improved
CFPS (f.d.)(old) -- 2.91 3.80 4.05 outlook for both near- and long-term oil prices.
NAVPS (f.d.) 24.27 -- -- --
Oil (b/d) 210,579 187,869 218,635 227,023 Specifically, our 2011 NYMEX natural gas price forecast drops to
Gas (MMcf/d) 1,283 1,361 1,414 1,511
MBOE/d 424.5 414.6 454.3 478.8
US$4.50/mmBTU (from US$5.00/mmBTU) while our 2011+ WTI oil price
forecast increases to US$85/bbl (from US$80/bbl). On this basis, our target
Valuations increases to $25/share from $24/share previously.
Year 2009A 2010E 2011E 2012E
P/CFPS (f.d.) 5.9x 7.6x 5.9x 5.2x
EV/DACF 6.1x 7.7x 6.0x 5.3x Downgrading on the basis of recent outperformance and relative
P/NAV 91.5% -- -- -- valuation: Talisman’s share price has appreciated 17.3% since we initiated
Supplemental Data coverage on December 9, 2009 (BUY recommendation, $24/share target
Year 2009A 2010E 2011E 2012E price). Talisman has also outperformed the underlying S&P/TSX Energy
Oil (US$/bbl) $61.85 $79.45 $85.00 $85.00 Index in this timeframe (up only 14.2%). With a projected total return of only
Gas(US$/mmBtu) $3.99 $4.37 $4.50 $5.25
13.7%, we are moving to a HOLD recommendation.
F/X (US$/C$) $0.88 $0.97 $0.99 $0.95
Downgrade does not reflect this morning’s 2011 guidance release:

All figures in C$, unless otherwise specified. Talisman also released its 2011 guidance early this morning. We intend to
undertake a full review of our target price and investment thesis later this
morning.
TLM-T: Price
Talisman Energy is a Calgary-based E&P
25 25
company with operations in the UK, Norway,
Southeast Asia, Latin America and the United 20 20
States. It also has active exploration programs
15 15
in a number of other countries.
5 5
January 11, 2011
53 of 86
Valuation
Talisman currently trades at 92% P/NAV and 6.0x 2011E EV/DACF, versus its peers at 83% and 6.3x,
respectively.
value of $19.50/share (40% weighting). Blending the two valuation methodologies and a discretionary
adjustment generates a 12-month target price of $25/share and our HOLD recommendation.

The key near-term risks specific to Talisman include the following:
• Disappointing drilling results in the Montney, Marcellus, Utica and Eagle Ford shales. Possible
introduction of a severance tax in the Marcellus.
• Disappointing exploration drilling results (Pasangkayu and Sageri in Indonesia, Runtasapa, K-44 Well-3
in Kurdistan, Block 133/134 Well-1 in Vietnam, and the PPL 261 Well-1 in PNG).
• An amendment to the development timeline for Block 15/2 HSD/HST.
We are issuing our downgrade in conjunction with the release of our revised outlook on the commodities. Our
downgrade is based solely on share price appreciation and relative valuation. Talisman’s share price has
appreciated 17.3% since we initiated coverage on December 9, 2009 and has outperformed the underlying
S&P/TSX Energy Index in that timeframe (up only 14.2%). With a projected total return of 13.7%, we are
moving to a HOLD recommendation. We also note that 2011 guidance was released early this morning. We
intend to revisit our target price and investment thesis later today.
Exhibit 1. NAV Summary ($/share)
AT PV ($mm)
$/Share
Risked Conventional Conventional Unconventional
Conventional Proven Probable 2P + 2C (Best Est) Total
Asset Class Region/Project PV/Mcfe - PV/BOE (2P) Gross Per Share Gross Per Share Gross Per Share Gross Per Share % of Total PV
North American Conventional North America $0.94 $3,747 $3.41 $1,338 $1.22 $5,085 $4.63 19%
North American Unconventional Montney Contingent Resource (39.2 tcfe) $2,300 $2.09 $2,300 $2.09 8%
Marcellus Contingent Resource (6 tcfe in PA, 5 tcfe in NY) $1,924 $1.75 $1,924 $1.75 7%
Eagle Ford Contingent Resource (2 tcfe) $1,320 $1.20 $1,320 $1.20 5%
CBM (Upper Mannville and Horseshoe Canyon) $97 $0.09 $97 $0.09 0%
International North Sea (UK) $12.63 $3,542 $3.22 $2,651 $2.41 $6,193 $5.63 23%
North Sea (Scandinavia) $674 $0.61 $989 $0.90 $1,663 $1.51 6%
Indonesia $0.70 $925 $0.84 $357 $0.32 $1,281 $1.17 5%
Malaysia - Vietnam - Australia $666 $0.61 $856 $0.78 $1,521 $1.38 6%
PNG $113 $0.10 $113 $0.10 0%
Algeria - Tunisia $11.55 $481 $0.44 $119 $0.11 $600 $0.55 2%
South America $1,680 $1.53 $1,680 $1.53 6%
Midstream Midstream & Marketing $500 $0.45 $500 $0.45 2%
Total Undeveloped Land Holdings $2,361 $2.15 $2,361 $2.15 9%
North American Conventional Tax Pools $638 $0.58 $638 $0.58 2%
Option Proceeds ($mm) $1,298 $1.18 $1,298 $1.18
Total $26,682 $24.27

January 11, 2011
54 of 86
Exhibit 2. Financial and Operating Summary Charts
Average Daily Production EPS and CFPS
500,000 1,500 $1.00

450,000 1,450 $0.90
Natural Gas Production (mmcf/d)

Oil & NGL Production (bbl/d)
400,000 1,400 $0.80
EPS & CFPS ($ per share)

350,000 1,350 $0.70
300,000 1,300 $0.60
250,000 1,250 $0.50
200,000 1,200 $0.40
150,000 1,150
$0.30
100,000 1,100
$0.20
50,000 1,050
$0.10
0 1,000
$0.00
Q3/09 Q4/09 Q1/10 Q2/10 Q3/10
Q3/09 Q4/09 Q1/10 Q2/10 Q3/10
Total Average Daily Production (BOE/d @ 6:1) CFPS (FD) EPS (FD)
Oil & Liquids (bbl/d)
Natural Gas (mmcf/d)
Commodity Prices Consolidated Realized Prices
$80 $9 $80 $8
$78 $8
$78 $7
Consolidated Natural Gas Price

Consolidated Oil & Liquids Price
$76 $7
Nymex (US$/mmbtu)
$74 $6 $76 $6
WTI (US$/bbl)
$72 $5
(C$/mcf)
(C$/bbl)
$74 $5
$70 $4
$68 $3 $72 $4
$66 $2
$70 $3
$64 $1
$62 $0 $68 $2
Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10
WTI (US$/bbl) Nymex (US$/mmBTU) Consolidated Corporate Oil & Liquids Price (C$/bbl)
Consolidated Corporate Natural Gas Price (C$/mcf)
Netback Summary Operating Cost Summary
$60 $7 $35 $1.7
$50 $6 $30 $1.6

Operating Cost (C$/BOE)
Operating Cost (C$/Mcf)

Netback (C$/BOE)
$25 $1.5
$40 $5
Netback (C$/Mcf)
$20 $1.4
$30 $4
$15 $1.3
$20 $3
$10 $1.2
$10 $2 $5 $1.1
$0 $1 $0 $1.0
Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10
Operating Netback - Scandanavian Oil and NGLs & Natural Gas Operating Costs - Scandanavian Oil and NGLs & Natural Gas
Operating Netback - NA Oil and NGLs Operating Costs - NA Oil and NGLs
Operating Netback - Southeast Asian & Australian Oil and NGLs & Natural Gas Operating Costs - Southeast Asian & Australian Oil and NGLs & Natural Gas
Operating Netback - NA Natural Gas Operating Costs - NA Natural Gas
Bow River at Hardisty Returns
$80 40% 45%

40%
$70 35%
Differential (as % of WTI)
35%
$60 30%
30%
$50 25%
% Return
25%
$40 20%
20%
$30 15%
15%
$20 10%
10%
$10 5% 5%
$0 0% 0%
Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 2005 2006 2007 2008 2009 2010E
Bow River at Hardisty (C$/bbl) ROE ROACE

Bow River Heavy Differential (as % of WTI)

January 11, 2011
55 of 86
Unconventional
Unchanged
Risk: HIGH
Canadian Oil Sands Ltd.
(COS-T) C$25.46
Unchanged
Transfer of Coverage - Maintaining HOLD Recommendation
Market Data (C$)
52-Wk Range $24.24-$33.05 Event
Mkt Cap (f.d.)($mm) $12,332.8 Transfer of coverage
Dividend Yield 3.1% Impact
Avg. Daily Trading Vol. (3mths) -- Neutral
Financial Data (C$)
Fiscal Y-E December Details
Float Shares (mm) -- We are transferring coverage of Canadian Oil Sands Ltd. (COS-T) in
Net Debt ($mm) $1,128.2 conjunction with the release of our revised commodity price deck. We are
Net Debt/Tot Cap 22.5% maintaining our target price of $28/share. With a projected total return of only
Estimates (C$) 13.1%, we are also maintaining our HOLD recommendation.
Year 2009E 2010E 2011E 2012E
CFPS (f.d.) 1.56 2.39 2.86 3.37 Outlook
CFPS (f.d.)(old) 1.56 2.16 2.61 --
Syncrude Canada has struggled with reliability of late. It therefore comes as
NAVPS (f.d.) 30.17 -- -- --
Oil (b/d) 102,899 107,811 109,254 117,568
no surprise that 2011 guidance appears relatively conservative. The mid-point
Gas (MMcf/d) 0 0 0 0 of production guidance stands at 297 mbbls/d (109.5 mbbls/d net to COS).
MBOE/d 102.9 107.8 109.3 117.6 This is up only 1.2% from 2010 production of 293 mbbls/d (107.8 mbbls/d
Valuations
net). The operator believes it can ultimately achieve production volumes that
Year 2009E 2010E 2011E 2012E reflect ~3-5% unplanned downtime in addition to planned downtime
P/CFPS (f.d.) 16.3x 10.7x 8.9x 7.6x (turnarounds and other routine maintenance activities).
EV/DACF 15.9x 10.8x 9.1x 7.9x
P/NAV 84.4% -- -- --
Capital spending is set to increase considerably in the coming years primarily
Supplemental Data (C$) due to a) planned mine train moves (two planned at Aurora North Mine with
Year 2009E 2010E 2011E 2012E
start-up in the 2013 timeframe), and b) mine train replacements (two planned
Oil (US$/bbl) 61.85 79.03 85.00 85.00
Gas (US$/mmBtu 3.99 4.35 4.50 5.25 at North Mine with start-up in the 2014 timeframe). The company has yet to
F/X (US$/C$) 0.88 0.97 0.99 0.95 release total projected costs for these mine train moves/replacements although
$332mm (or $8.21/bbl) has been allocated in 2011 alone.
With respect to dividends, COS intends to continue providing a variable
dividend to investors (the quarterly dividend currently stands at $0.20/share).
The distribution policy has, and will continue to reflect available cash post
investment in the project’s core operations, adjustments for growth capital,
and the management of debt levels. The dividend will also continue to be
reviewed on a quarterly basis.
COS-T: Price
Canadian Oil Sands Trust's ownership of
50 50
36.74% interest in Syncrude Canada Ltd. is
the trust's only producing asset. Syncrude is 40 40
the largest producing oil sands project in the
30 30
world and produces about 12% of the total
Please see the final pages of crude oil production in Western Canada. 20 20
10 10
January 11, 2011
56 of 86
Lastly, on the balance sheet, COS has indicated it will continue to target a debt load similar to current levels
over the next few years. Its current net debt stands at ~$1.1B with an associated Net Debt/Total Cap ratio of
22.5%. At these levels, it believes it can maintain adequate capacity to fund larger projects currently slated for
the second half of the decade. This includes Aurora South Train-1 (100 mbbls/d, 2016 target start date), Aurora
South Train-2 (100 mbbls/d, 2018 target start date) and the Upgrader Debottleneck (2016 target start date).
Exhibit 1: NAV Summary
AT PV ($mm)
$/Share
Conventional Conventional
Onstream Risk Proven Probable 2P + 2C (Best Est) Total
Asset Class Region/Project Date Factor Gross Per Share Gross Per Share Gross Per Share Gross Per Share % of Total PV
North American Unconventional Syncrude - Base + Stage 3 2006 0% $14,609 $30.16 $14,609 $30.16 93%
Syncrude - Stage 3 Debottleneck 2016 50% $205 $0.42 $205 $0.42 1%
Syncrude - Aurora South Train-1 (Non-Upgraded) 2017 50% $314 $0.65 $314 $0.65 2%
Syncrude - Aurora South Train-2 (Non-Upgraded) 2018 50% $314 $0.65 $314 $0.65 2%
Total Undeveloped Land Holdings $0 $0.00 $0 $0.00 0%
North American Conventional Tax Pools $300 $0.62 $300 $0.62 2%
Option Proceeds ($mm) $0 $0.00 $0 $0.00
Total -$828 -$1.71 $0 $0.00 $15,442 $31.88 $14,614 $30.17
% of Total -6% -6% 0% 0% 106% 106% 100% 100% 100%
Valuation
COS currently trades at a P/NAV of 84% and a 2011E EV/DACF multiple of 9.1x. This compares with the
peer group average of 88% and 9.2x respectively.

value of $25.71/share (40% weighting). Blending the two valuation methodologies generates a 12-month target
price of $28/share and our HOLD recommendation.
Exhibit 2: Summary of Target Price Calculation
Net Asset Value Calculation

NAV (2P + 2C) $30.17
12-month Growth Rate (%) 3%
Growth Adjusted NAV (2P + 2C) $30.92
Target Based on
Historical Avg Projected EV/DACF Rolling 12-mth Net Debt Per Share Projected Multiple
EV/DACF Based Valuation EV/DACF Multiple Multiple DACFPS (Basic) (net of debt/sh)
Historical Forward EV/DACF Multiple (1 Yr Avg) 9.9 $2.93 $2.09
Historical Forward EV/DACF Multiple (2 Yr Avg) 10.0 9.5 $2.93 $2.09 $25.71
Historical Forward EV/DACF Multiple (3 Yr Avg) 9.6 $2.93 $2.09
Weightings
NAV 60%
EV/DACF 40%
Discretionary Adjustment (+/- 10%) * ($0.50) Reflects a discretionary adjustment of -2%
Blended Valuation & Target Price $28.00
* The discretionary adjustment is incorporated to account for items not specifically valued in the calculations outlined above. Items
include anticipated near-term fluctuations in commodity prices, near-term positive or negative catalysts and financial flexibility
considerations (reflected in strength of balance sheet).

January 11, 2011
57 of 86

Key risks associated with our target price include business risks of the company and the industry, including but
not limited to: volatile commodity prices, product supply and demand, operating costs, royalty rates, taxes,
localized capital cost inflationary pressures, exchange rates, interest rates, and regulatory, government and
environmental approvals. Further considerations in today’s regulatory environment include potential costs
associated with greenhouse gas emissions and mandated carbon capture and storage.
As a passive working interest partner in Syncrude (albeit majority), COS has limited influence over setting
capital budgets. Expected expansions may not be approved by the other JV partners as per the timelines
identified by COS, if at all. Since its only producing asset is its working interest in the integrated operations of
Syncrude Canada, it has significant exposure to the impact of weather and unplanned interruptions. While
downtime for planned shutdowns is reflected in our production forecasts, unplanned downtime has the
potential to materially and negatively impact operating and financial results.
We are maintaining our target price of $28/share. With a projected total return of only 13.1%, we are also
maintaining our HOLD recommendation and contend that better entry points may present themselves as the
company continues to work through recent operational shortcomings.
January 11, 2011
58 of 86
Energy Producers Year-end Commodity Price Deck Update

Roger Serin, P.Eng.
Menno Hulshof, CFA

Summary of Key Changes: We are making several adjustments to our short-term
and long-term commodity price assumptions. Although there are several changes to
Jamie Somerville
point to, the most meaningful revisions were made to our short-term (2011) natural
Lara King, CFA
gas price and FX forecast and long-term crude oil outlook. We last changed our
commodity price deck on September 21, 2010.
Notes: Specifically, our 2011 Nymex natural gas price forecast was reduced (yet again) to
US$4.50/mmBTU (from US$5.00/mmBTU previously, a 10.0% reduction) while our
2011 US$/C$ FX forecast was increased to $0.99 (from $0.96 due to a weakening in
the US dollar). Lastly, we increased our long-term crude oil outlook to a flat
All figures in C$, unless otherwise specified. US$85/bbl from 2011E forward (from US$80/bbl previously), which reflects a 6.3%
increase.
Clearly these revisions had the most negative impact on our gas weighted names, and
the most positive impact on our oil weighted names (and particularly the oil sands
producers). A full summary of changes is provided in Exhibit 1.
Exhibit 1: Summary of Changes to Commodity Prices
2011E Change 2012E Change LT (2014E+) Change

Revised Old % Revised Old % Revised Old %
Commodity (if diff't) (if diff't) (if diff't)
Nymex WTI (US$/bbl) $85.00 $80.00 6.3% $85.00 $80.00 6.3% $85.00 $80.00 6.3%
Nymex Natural Gas (US$/bbl) $4.50 $5.00 -10.0% $5.25 $6.00
AECO (C$/mcf) $3.89 $4.36 -10.9% $4.76 $4.74 0.4% $5.53 $5.53 0.0%
FX (US$/C$) $0.99 $0.96 2.8% $0.95 $0.95
Source: TD Newcrest estimates
In Exhibits 2 and 3, we summarize changes to our target prices, recommendations,

and cash flow estimates.
Please see the final pages of

disclosure information.
January 11, 2011
59 of 86
Exhibit 2. Summary of Changes to Target Prices and Recommendations
Target Price ($/share) Change Return Recommendation Analyst

Ticker Current Price Dividends New Old (%) (%) New Old
Senior Producers (if diff't) (if diff't)
Canadian Natural Resources Ltd. CNQ-T $41.60 $0.30 $53.00 $51.00 4% 28% BUY MH
Canadian Oil Sands Ltd. COS-T $25.46 $0.80 $28.00 13% HOLD MH
Encana Corp. ECA-N $28.91 $0.80 $31.00 $32.00 -3% 10% HOLD MH
Nexen Inc. NXY-T $21.82 $0.20 $27.00 $24.00 13% 25% BUY HOLD MH
Talisman Energy Inc. TLM-T $22.20 $0.25 $25.00 $24.00 4% 14% HOLD BUY MH
Integrateds
Cenovus Energy Inc. CVE-T $31.95 $0.80 $34.00 $32.00 6% 9% HOLD MH
Husky Energy Inc. HSE-T $26.13 $1.20 $31.00 23% BUY MH
Imperial Oil Ltd. IMO-T $39.33 $0.44 $44.00 $43.00 2% 13% HOLD MH
Suncor Energy Inc. SU-T $36.85 $0.40 $47.00 $45.00 4% 29% BUY MH
Unconventionals
BlackPearl Resources Ltd. PXX-T $5.94 $5.75 $5.00 15% -3% HOLD MH
MEG Energy Corp. MEG-T $41.60 -----------------------------------------------Under Review--------------------------------------------- MH
Petrobank Energy and Resources Ltd. PBG-T $24.91 $32.00 $30.00 7% 28% BUY MH
International Producers
Alange Energy Corp. ALE-V $0.49 $0.00 $0.75 $0.70 7% 55% BUY HOLD JS
Bankers Petroleum Ltd. BNK-T $8.28 $0.00 $11.50 $10.50 10% 39% AL BUY JS
BNK Petroleum Inc. BKX-T $4.06 $0.00 $5.00 $4.00 25% 23% BUY JS
Canacol Energy Ltd. CNE-V $1.54 $0.00 $2.00 $1.80 11% 30% BUY HOLD JS
C&C Energia Ltd. CZE-T $11.92 $0.00 $16.00 $14.50 10% 34% BUY JS
Gran Tierra Energy Inc. GTE-T $8.13 $0.00 $9.50 $9.00 6% 17% HOLD JS
Niko Resources Ltd. NKO-T $94.75 $0.24 $140.00 $135.00 4% 48% BUY JS
Pacific Rubiales Energy Corp. PRE-T $31.47 $0.38 $38.00 $36.00 6% 22% HOLD JS
Parex Resources Inc. PXT-V $9.33 $0.00 $9.00 $8.00 13% -4% HOLD JS
Petrodorado Energy Ltd. PDQ-V $0.68 $0.00 $1.15 $1.10 5% 69% SPEC BUY JS
Petrominerales Ltd. PMG-T $35.47 $0.50 $42.00 $39.00 8% 20% HOLD JS
TransAtlantic Petroleum Ltd. TNP-T $3.22 $0.00 $4.25 32% BUY JS
Intermediate E&P
Advantage Oil & Gas Ltd. AAV-T $6.72 $0.00 $7.50 $8.00 -6% 12% HOLD BUY RS
ARC Resources Ltd. ARX-T $24.99 $1.20 $26.00 $23.00 13% 9% HOLD RS
Bonavista Energy Corp. BNP-T $28.68 $1.44 $33.00 $31.00 6% 20% BUY RS
Baytex Energy Corp. BTE-T $46.50 $2.40 $52.00 $49.00 6% 17% BUY RS
Celtic Exploration Ltd. CLT-T $17.08 $0.00 $18.00 $15.00 20% 5% HOLD RS
Crescent Point Energy Corp. CPG-T $42.38 $2.76 $45.00 $46.00 -2% 13% HOLD BUY RS
Crew Energy Inc. CR-T $19.39 $0.00 $24.00 $23.00 4% 24% BUY RS
Daylight Energy Ltd. DAY-T $9.98 $0.60 $11.00 16% BUY RS
Enerplus Corp. ERF-T $31.08 $2.16 $35.00 $33.00 6% 20% BUY RS
Freehold Royalties Ltd. FRU-T $20.94 $1.68 $19.00 $19.50 -3% -1% HOLD RS
NAL Energy Corp. NAE-T $12.75 $0.84 $13.50 $13.00 4% 12% HOLD RS
NuVista Energy Ltd. NVA-T $8.61 $0.05 $12.00 40% BUY RS
PetroBakken Energy Ltd. PBN-T $21.78 $0.96 $26.00 24% BUY RS
Pengrowth Energy Corp. PGF-T $12.89 $0.84 $14.00 15% HOLD BUY RS
Perpetual Energy Inc. PMT-T $3.86 $0.27 $3.75 $4.00 -6% 4% HOLD RS
Paramount Resources Ltd. POU-T $31.43 $0.00 $26.00 $25.00 4% -17% REDUCE HOLD RS
Progress Energy Resources Ltd. PRQ-T $12.31 $0.40 $11.00 $12.00 -8% -7% HOLD RS
Penn West Exploration PWT-T $24.07 $1.08 $28.00 $27.00 4% 21% BUY RS
Trilogy Energy Corp. TET-T $12.10 $0.42 $13.50 $11.50 17% 15% HOLD RS
Vermilion Energy Inc. VET-T $46.12 $2.28 $42.00 $41.00 2% -4% HOLD RS
Zargon Oil & Gas Ltd. ZAR-T $22.09 $1.68 $19.50 $18.50 5% -4% HOLD RS
Source: TD Newcrest estimates, Bloomberg

January 11, 2011
60 of 86
Exhibit 3. Summary of Changes to Financial Estimates
Ticker 2011E CFPS Change 2012E CFPS Change NAV ($/Share) Change
Revised Old % Revised Old % Revised Old %
Senior Producers (if diff't) (if diff't) (if diff't)
Canadian Natural Resources Ltd. CNQ-T $6.46 $6.32 2.2% $7.39 $7.01 5.4% $52.47 $48.44 8.3%
Canadian Oil Sands Ltd. COS-T $2.86 $2.61 9.6% $3.37 NR $30.17 $28.00 7.7%
Encana Corp. ECA-N $5.15 $5.71 -9.8% $6.38 $6.58 -3.0% $32.14 $32.43 -0.9%
Nexen Inc. NXY-T $4.91 $4.47 9.9% $5.37 $5.12 4.9% $31.71 $28.53 11.2%
Talisman Energy Inc. TLM-T $3.78 $3.80 -0.5% $4.28 $4.05 5.7% $24.27 $23.62 2.8%
Integrateds
Cenovus Energy Inc. CVE-T $2.84 $2.89 -1.7% $3.38 $3.16 6.9% $35.04 $34.24 2.3%
Husky Energy Inc. HSE-T $4.17 $4.18 -0.4% $4.58 $4.33 5.8% $28.93 $28.07 3.1%
Imperial Oil Ltd. IMO-T $3.64 $3.49 4.4% $3.89 $3.45 12.9% $41.59 $40.99 1.5%
Suncor Energy Inc. SU-T $4.90 $4.73 3.8% $6.12 $5.78 6.0% $49.03 $45.18 8.5%
Unconventionals
BlackPearl Resources Ltd. PXX-T $0.27 $0.25 6.0% $0.42 $0.39 9.6% $4.79 $4.52 5.8%
MEG Energy Corp. MEG-T ------------------------------------------------------Under Review-----------------------------------------------------------
Petrobank Energy and Resources Ltd. PBG-T $6.34 $6.33 0.2% $8.62 $8.01 7.6% $28.15 $23.59 19.3%
NAV values for Seniors, Integrateds and Unconventionals represent TD Newcrest's fully expanded, risked estimate of NAV (2P + 2C)
International Producers
Alange Energy Corp. ALE-V $0.10 $0.09 7.0% $0.14 $0.13 7.0% $0.81 $0.73 12.1%
Bankers Petroleum Ltd. BNK-T $0.56 $0.50 12.8% $1.03 $0.89 15.8% $12.04 $10.70 12.4%
BNK Petroleum Inc. BKX-T $0.08 $0.11 -28.3% $0.28 $0.37 -24.7% $5.31 $4.13 28.7%
Canacol Energy Ltd. CNE-V $0.22 $0.21 5.5% $0.23 $0.22 7.4% $2.16 $1.95 10.6%
C&C Energia Ltd. CZE-T $1.91 $1.75 8.8% $2.63 $2.51 5.0% $15.80 $14.17 11.5%
Gran Tierra Energy Inc. GTE-T $1.03 $0.97 6.1% $1.29 $1.21 6.5% $9.75 $8.93 9.1%
Niko Resources Ltd. NKO-T $7.44 $7.40 0.5% $9.90 $9.79 1.2% $166.57 $158.43 5.1%
Pacific Rubiales Energy Corp. PRE-T $4.90 $4.63 6.0% $6.21 $5.82 6.7% $38.63 $35.80 7.9%
Parex Resources Inc. PXT-V $0.72 $0.76 -5.1% $1.91 $2.08 -8.0% $9.02 $8.44 6.8%
Petrodorado Energy Ltd. PDQ-V $0.04 $0.04 1.9% $0.09 $0.09 -0.7% $1.36 $1.25 9.0%
Petrominerales Ltd. PMG-T $6.33 $5.89 7.5% $7.16 $7.05 1.5% $40.61 $37.30 8.9%
TransAtlantic Petroleum Ltd. TNP-T $0.30 $0.30 -1.9% $0.40 $0.40 0.1% $4.68 $4.51 3.8%
Fiscal 2012 used as equivalent to calendar 2011 and Fiscal 2013 used as equivalent to calendar 2012 for CNE and NKO.
All CFPS estimatets in US$, except for CNE
NAV values represent TD Newcrest's Fully-risked NAVPS estimates in C$.
Intermediate E&P
Advantage Oil & Gas Ltd. AAV-T $1.10 $1.21 -9.0% $1.15 - - $7.72 - -
ARC Resources Ltd. ARX-T $2.72 $2.85 -4.8% $2.88 - - $20.24 - -
Bonavista Energy Corp. BNP-T $3.55 $3.72 -4.6% $4.10 - - $34.82 - -
Baytex Energy Corp. BTE-T $4.48 $4.48 -0.1% $5.16 - - $52.67 - -
Celtic Exploration Ltd. CLT-T $1.92 $2.06 -6.5% $2.54 - - $12.06 - -
Crescent Point Energy Corp. CPG-T $4.22 $4.07 3.5% $4.45 - - $38.85 - -
Crew Energy Inc. CR-T $2.11 $2.17 -2.4% $2.75 - - $21.48 - -
Daylight Energy Ltd. DAY-T $1.23 $1.35 -9.1% $1.29 - - $11.91 - -
Enerplus Corp. ERF-T $3.93 $4.12 -4.8% $4.45 - - $34.89 - -
Freehold Royalties Ltd. FRU-T $1.89 $1.88 0.3% $1.58 - - $16.55 - -
NAL Energy Corp. NAE-T $1.85 $2.04 -9.2% $2.13 - - $14.04 - -
NuVista Energy Ltd. NVA-T $2.40 $2.59 -7.1% $3.11 - - $12.34 - -
PetroBakken Energy Ltd. PBN-T $4.01 $4.15 -3.6% $4.61 - - $29.12 - -
Pengrowth Energy Corp. PGF-T $1.89 $1.99 -5.2% $1.99 - - $14.56 - -
Perpetual Energy Inc. PMT-T $0.37 $0.56 -34.3% $0.54 - - $4.29 - -
Paramount Resources Ltd. POU-T $1.00 $1.15 -13.7% $1.61 - - $21.99 - -
Progress Energy Resources Ltd. PRQ-T $0.83 $1.00 -17.5% $1.01 - - $10.99 - -
Penn West Exploration PWT-T $3.16 $3.16 -0.1% $3.58 - - $30.43 - -
Trilogy Energy Corp. TET-T $1.62 $1.54 4.9% $2.56 - - $9.44 - -
Vermilion Energy Inc. VET-T $4.83 $4.72 2.4% $5.14 - - $36.79 - -
Zargon Oil & Gas Ltd. ZAR-T $3.25 $3.35 -3.0% $3.44 - - $22.03 - -
NAV values represent TD Newcrest's Modified Growth NAV
Source: TD Newcrest estimates

January 11, 2011
61 of 86
Outlook for the Commodities
Natural Gas: Despite above-average withdrawals, seasonal gas inventory levels remain near record highs.
Stockpiles currently sit 6.5%, or 196 Bcf, above the five-year average and only marginally below levels last
year. The near record storage levels can largely be attributed to ample supply. According to Bentek Energy,
U.S natural gas production in mid-December averaged 63 Bcf/d, which is nearly 10% higher than the
comparable period one year earlier. Moreover, recently gas supply is increasing in Canada. Looking beyond
2011, we see factors that could result in reduced supply, including minimal hedging post 2011, reduced
drilling for land retention and producers shifting capital from natural gas to crude oil prospects.
Natural gas prices have strengthened modestly over the past month and remain in the US$4/mmBTU range,
following a period of weakness during the months of September and October where the front month contract
was trading mostly in the US$3/mmBTU range. While expected due to seasonality, we do not anticipate a
material movement upwards of the US$4.50-5.00/mmBTU range. Should this happen, we continue to believe
that there is plenty of incremental supply that would quickly make its way into the market. We are adjusting
our short term view (2011E) to reflect increased weakness during the most recent quarter in the commodity,
but do not see the need to materially adjust our long term (2012E+) outlook at this time. Accordingly, we are
reducing our 2011E forecast to US$4.50/mmBTU (from US$5.00/mmBTU previously).
Oil: We are maintaining our view that oil weighted names will generate superior returns relative to natural gas
weighted names in the near future.
The United States’ Energy Information Administration (EIA) has steadily raised its estimate of 2011 average
global demand from 86.7 mmbbl/d (January 2010 estimate) to 87.8 mmbbl/d (December 2010 estimate),
driven almost entirely by upward revisions to estimates of demand from emerging markets economies, in
particular China. Over the same period, the EIA has lowered its estimate of OPEC production capacity from
35.7 mbbl/d to 34.6 mbbl/d, more than offsetting an increase in its estimate of non-OPEC supply from 50.6
mmbbl/d to 51.3 mmbbl/d. The end result is that the EIA’s estimate of expected spare capacity in 2011 has
decreased from 5.7 mmbbl/d in January 2010 to just 4.8 mmbbl/d in December 2010. If such a material
reduction in spare capacity has indeed occurred, it would more than justify the increased prices oil has recently
traded at, as well as the increase to US$85/bbl we have made to our forward assumptions for WTI.
However, estimates of global spare capacity are inherently unreliable. We note that the International Energy
Agency’s (IEA) latest estimate of OPEC spare capacity at approximately 5.8 mmbbl/d (or 6.1% of total
demand) is effectively unchanged over the last 15 months. In addition, OECD inventories for crude and
products (crude oil, gasoline and distillates) all continue to trend above or at the top end of their historic five-
year averages. As was the case through most of 2010, oil prices are trading well above the levels that would be
suggested by historic relationships between spare capacity, inventories and price. Regardless of which estimate
of spare capacity we use, it appears that OPEC can meet any increased demand or normal production
disruptions in the foreseeable future. We also view significant correlation of oil price increases to financial
funds flowing into speculative positions in oil futures as a worrisome indicator of a potential over-bought
situation that could yield a price correction. As a result, we have chosen not to get closer to the forward curve
by adopting a US$90/bbl assumption.
January 11, 2011
62 of 86
Appendix 1. Justification of Target Prices and Risks – Senior Producers, Integrateds & Unconventionals
Target
Company Ticker Exchange Rec. Risk Rating Justification of Target Price
Price
Canadian Natural Our 12-month target price is based on a 60% weighting to our growth adjusted NAV (2P + 2C), a 40% weighting
CNQ T, N $53.00 BUY HIGH
Resources Ltd. to EV/DACF based on our rolling 12-month DACF estimate and a discretionary adjustment that can vary +/-10%.
Canadian Oil Sands Our 12-month target price is based on a 60% weighting to our growth adjusted NAV (2P + 2C), a 40% weighting
COS T $28.00 HOLD HIGH
Ltd. to EV/DACF based on our rolling 12-month DACF estimate and a discretionary adjustment that can vary +/-10%.
Our 12-month target price is based on a 60% weighting to our growth adjusted NAV (2P + 2C), a 40% weighting
Encana Corp. ECA T, N US$31.00 HOLD HIGH
to EV/DACF based on our rolling 12-month DACF estimate and a discretionary adjustment that can vary +/-10%.
Nexen Inc. NXY T, N $27.00 BUY HIGH
Talisman Energy Inc. TLM T, N $25.00 HOLD HIGH
Cenovus Energy Inc. CVE T, N $34.00 HOLD HIGH
Husky Energy Inc. HSE T $31.00 BUY HIGH
Imperial Oil Ltd. IMO T, N $44.00 HOLD MEDIUM
Suncor Energy Inc. SU T, N $47.00 BUY HIGH
BlackPearl Our 12-month target price is based on a 100% weighting to our growth adjusted NAV (2P + 2C) and a
PXX T $5.75 HOLD SPECULATIVE
Resources Inc. discretionary adjustment that can vary +/-10%.
Petrobank Energy & Our 12-month target price is based on a 60% weighting to our growth adjusted NAV (2P + 2C), a 40% weighting
PBG T $32.00 BUY HIGH
Resources Ltd. to EV/DACF based on our rolling 12-month DACF estimate and a discretionary adjustment that can vary +/-10%.
January 11, 2011
63 of 86
Target
Company Ticker Exchange Rec. Risk Rating Key Risks to Target Price
Price
overruns, product supply and demand, financing/access to capital, government regulations, legislation, royalties,
taxes, exchange rates, interest rates, environmental and weather concerns.
In addition to industry risks, key near-term risks include:
• Production rates that continue to underwhelm at Olowi.

Canadian Natural • A reversal of heavy differentials to historical levels, which would have a meaningful impact, given its heavy oil
CNQ T, N $53.00 BUY HIGH
Resources Ltd. exposure.
• Disappointing exploration drilling results, offshore South Africa for example.
• Ability to secure additional sources of funding and Syncrude’s ability to secure regulatory and government
approvals relating to additional expansion and development.
Canadian Oil Sands • Potential costs associated with greenhouse gas emissions and carbon capture and storage.
COS T $28.00 HOLD HIGH
Ltd. • It has significant but limited control over capital and operating budgets and expected expansion plans may not
be approved by JV partners as per the timelines identified by the company.
• Significantly exposed to the impact of weather- related and/or operational shutdowns or upsets.
• A further deterioration in fundamentals for natural gas.

Encana Corp. ECA T, N US$31.00 HOLD HIGH • Disappointing drilling results from resource plays such as the Horn River, Montney, Haynesville, Brent Miller and
Collingwood shales.
• Operating results at Long Lake that continue to disappoint.

• Exploration drilling results that fall short of expectations in the near-term (Knotty Head, North Uist and Brant
prospects).
Nexen Inc. NXY T, N $27.00 BUY HIGH
• An unsuccessful outcome to the Yemen contract renegotiation.
• Higher than average geopolitical risk offshore Nigeria and environmental risk in the GOM due to hurricane
activity.
• Disappointing drilling results in the Montney, Marcellus, Utica and Eagle Ford shales. Possible introduction of a
severance tax in the Marcellus.
Talisman Energy Inc. TLM T, N $25.00 HOLD HIGH • Disappointing exploration drilling results (Pasangkayu and Sageri in Indonesia, Runtasapa, K-44 Well-3 in
Kurdistan, Block 133/134 Well-1 in Vietnam, and the PPL 261 Well-1 in PNG).
• An amendment to the development timeline for Block 15/2 HSD/HST.
• A reversion of heavy differentials to historical levels. Although Foster Creek and Christina Lake are being
developed on an integrated basis, projects outside of the joint venture are clearly more exposed.
Cenovus Energy Inc. CVE T, N $34.00 HOLD HIGH
• A delay to the construction completion date for Christina Lake Phase C (first production slated for Q4/11).
• A delay to the timeline for completion of the CORE project (currently targeting a mid-2011 start date).
• Disappointing exploration drilling results in southeast Asia.

• Incremental production additions from the re-drilling of wells at Tucker fall short of expectation.
• No improvement in the outlook for downstream.
Husky Energy Inc. HSE T $31.00 BUY HIGH
• As with all companies where voting control is not in the market, the controlling shareholder (Li Ka-Shing, which
effectively controls 70.5% of outstanding shares) and minority shareholders may not agree on issues that could
affect the value of shares held by the minority.
• Cost overruns and/or delays at Kearl Lake Phase 1 and the Nabiye expansion at Cold Lake.
• No improvement in the outlook for downstream.
• As with all companies where voting control is not in the market, the controlling shareholder (ExxonMobil, which
Imperial Oil Ltd. IMO T, N $44.00 HOLD MEDIUM
effectively controls 70% of outstanding shares) and minority shareholders may not agree on issues that could
affect the value of shares held by the minority.
• Uncertainties relating to regulatory approval for the Mackenzie Delta Natural Gas Project.
• Suncor does not intend to hedge aggressively going forward. This leaves it more exposed to volatility in oil
Suncor Energy Inc. SU T, N $47.00 BUY HIGH prices.
• If Suncor decides to defer the majority of its oil sands projects, safe mode costs will continue to accrue.
• A reversal of heavy differentials to historical levels (since heavy oil accounts for the majority of its production
base, this would translate into a sharp reduction in field netbacks and full cycle returns).
BlackPearl
PXX T $5.75 HOLD SPECULATIVE • An inability to source the necessary capital to fund the development of its key growth projects (sourcing this
Resources Inc.
capital is ultimately contingent on market conditions).
• The technical risk associated with SAGD and polymer flooding.
• Continued ramp-up at Kerrobert.

• A slower than expected approval process for its first 10 mbbl/d commercial phase at May River.
Petrobank Energy &
PBG T $32.00 BUY HIGH • Royal Dutch Shell may choose to slow the pace of development at Dawson.
Resources Ltd.
• A reduction in the dividend payable from PetroBakken Energy Ltd. and Petrominerales Ltd. It is heavily reliant on
this capital for the future funding of development activities.
January 11, 2011
64 of 86
Appendix 2. Justification of Target Prices and Risks – International E&P’s
Stock Name Ticker Exchange Share Price Target Price Justification of Target Price Base Multiple Upside Multiple
Our target price for Alange Energy Corp. is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Alange Energy Corp. ALE V $0.49 $0.75
estimate of Base NAVPS and a 0.9x multiple is applied to our Upside to Base NAVPS. 1.00x 0.90x
Our target price for Bankers Petroleum Ltd.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Bankers Petroleum Ltd. BNK T, L $8.28 $11.50
Our target price for BNK Petroleum Inc.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
BNK Petroleum Inc. BKX T $4.06 $5.00
Our target price for Canacol Energy Ltd. is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Canacol Energy Ltd. CNE V, BVC $1.54 $2.00
Our target price for C&C Energia Ltd.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
C&C Energia Ltd. CZE T $11.92 $16.00
estimate of Base NAVPS and a 1x multiple is applied to our Upside to Base NAVPS. 1.00x 1.00x
Our target price for Gran Tierra Energy Inc.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Gran Tierra Energy Inc. GTE T, N $8.13 $9.50
Our target price for Niko Resources Ltd.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Niko Resources Ltd. NKO T $94.75 $140.00
Our target price for Pacific Rubiales Energy Corp.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to
Pacific Rubiales Energy Corp. PRE T, BVC $31.47 $38.00
our estimate of Base NAVPS and a 0.95x multiple is applied to our Upside to Base NAVPS. 1.00x 0.95x
Our target price for Parex Resources Inc. is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Parex Resources Inc. PXT V $9.33 $9.00
estimate of Base NAVPS and a 1x multiple is applied to our Upside to Base NAVPS. 1.00x 1.00x
Our target price for Petrodorado Energy Ltd. is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Petrodorado Energy Ltd. PDQ V $0.68 $1.15
Our target price for Petrominerales Ltd.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to our
Petrominerales Ltd. PMG T $35.47 $42.00
Our target price for TransAtlantic Petroleum Ltd.is based on a combination of Base and Fully-risked NAVPS. A 1.0x multiple is applied to
TransAtlantic Petroleum Ltd. TNP T, N $3.22 $4.25
our estimate of Base NAVPS and a 0.85x multiple is applied to our Upside to Base NAVPS. 1.00x 0.85x
January 11, 2011
65 of 86
Overall Risk
Stock Name Ticker Exchange Share Price Target Price Rating Key Risks to Target Price
Risks Common to all International E&Ps overruns, product supply and demand, financing/access to capital, government regulations, legislation,
The key near-term risks specific to Alange are:

• Gas market and infrastructure risk is significant since ~80% of the company’s P+P gas reserves are undeveloped gas
Alange Energy Corp. $0.49 $0.75 HIGH
and NGLs.
ALE V
• Higher than average security risk in the Putumayo and Catatumbo Basins.
The key near-term risks specific to Bankers are:

• Downside risk in a lower heavy oil price environment (we believe that under US$50/bbl, a significant proportion of
undeveloped reserves would become uneconomic).
Bankers Petroleum Ltd. BNK T, L $8.28 $11.50 HIGH • Availability of processing and export infrastructure, including delays in developing infrastructure, is a considerable risk,
and could delay production growth.
The key near-term risks specific to BNK Petroleum are:

• Exploration and appraisal risk, which makes cost and timelines required to develop shale gas in Europe highly
uncertain.
BNK Petroleum Inc. BKX T $4.06 $5.00 HIGH • High sensitivity to oil prices, which presents a significant risk to future capital management.
• The shale gas market in Europe is far less developed than in North America and my attract restrictions or legislation
that erode our forecast economics.
The key near-term risks specific to Canacol are:

Canacol Energy Ltd. CNE V, BVC $1.54 $2.00 HIGH • Financing risk is significant for Canacol.
The key-near term risks specific to C&C are:

C&C Energia Ltd. $11.92 $16.00 HIGH
CZE T
• Liquidity risk.
The key near-term risks specific to Gran Tierra are outlined below:
• Concentration and reserves risk as the Costayaco field accounts for ~87% of the company’s P+P reserves.
Gran Tierra Energy Inc. GTE T, N $8.13 $9.50 HIGH • Higher than average geo-political risk.
• Environmental and social objections to development of possible discoveries could be particularly relevant in Peru.
The key near-term risks specific to Niko are:

• We view gas markets in India as a key risk for Niko. With approximately 93% of the company’s P+P reserves
attributable to its 10% interest in the D6 block, concentration and control risk are both high
• Fiscal risks in India: it is possible that a seven-year tax holiday that we assume for gas developments on Niko’s key
Niko Resources Ltd. NKO T $94.75 $140.00 HIGH development blocks, including D6, will not be valid.
• Higher than average geo-political risk across several developing countries.
• The financial and operational strength of operator Reliance Industries is a key consideration and potential risk.
• Offshore regulations could be changed in international jurisdictions in reaction to recent incidents in the U.S.
Key risks specific to Pacific Rubiales are:

• Reserves risk, in particular related to the expiry of the company’s main producing contract in 2016.
• Potential infrastructure constraints also present a significant risk.
Pacific Rubiales Energy Corp. PRE T, BVC $31.47 $38.00 HIGH • Higher than average geo-political risk.
• Commodity price risk is potentially exacerbated by Pacific Rubiales’ exposure to heavy oil differentials and its oil trading
activities.
Key risks specific to Parex are:

• Our NAVPS estimates are entirely based on working capital and exploration prospects, as the company has no booked
Parex Resources Inc. PXT V $9.33 $9.00 SPEC reserves.
• Due to the early exploration stage nature of the company, exploration risk is also relatively high.
• Potential regulatory delays in Trinidad are a risk, in our view.
• Higher than average geo-political risk
Key risks specific to Petrodorado are:
• Exploration risk is relatively high. Our NAVPS is entirely based on working capital and exploration prospects, as the
company has no booked reserves.
Petrodorado Energy Ltd. PDQ V $0.68 $1.15 SPEC • A relatively low proportion of the company’s assets being operated implies significant control risk. When added to the
very limited near-term cash flow expectations, this contributes to considerable financial risk.
• Environmental and social objections to development of possible discoveries could be particularly relevant in Peru and
Paraguay
Key risks specific to Petrominerales are:
• Significant exploration success is required to maintain or grow production due to high initial decline rates on new wells
in the Corcel area.
Petrominerales Ltd. PMG T $35.47 $42.00 HIGH • Liquidity risk is significant for Petrominerales.
• Access to transportation infrastructure is an important risk, in our opinion.
Key risks specific to TransAtlantic are:

• Financing, exploration and liquidity risk are relevant to TransAtlantic.
• Potential for significant influence - Malone Mitchell owns just under 50% of the basic outstanding shares of the
TransAtlantic Petroleum Ltd. TNP T, N $3.22 $4.25 HIGH company.
• Higher than average geo-political risk. Despite being a secular democratic republic, political risk in Turkey is
considerable.
January 11, 2011
66 of 86
Appendix 3. Justification of Target Prices and Risks – Intermediate Producers

Ticker Price Target Rating Risk Justification of Target Prices and Key Risks
AAV-T $6.72 $7.50 HOLD High Our target price reflects a base valuation of $7.42 that combines 1.0x our modified growth NAV of $7.72 at a 65% weighting and $6.87 using an
EV/DACF multiple of 7.0x 2011E DACF at a 35% weighting. This is then adjusted by a subjective factor of 0% (within a range of +/- 25% for the sector).
Key risks associated with our target price include business risks of the company and industry, including but not limited to: loss of key employees, drilling
success, volatile commodity prices, operating costs, capital cost overruns, product supply and demand, financing/access to capital, government
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to Advantage include asset
concentration of the capital program in the Glacier region.
ARX-T $24.99 $26.00 HOLD High Our target price reflects a base valuation of $23.90 that combines 1.0x our modified growth NAV of $20.24 at a 65% weighting and $30.71 using an
EV/DACF multiple of 11.2x 2011E DACF at a 35% weighting. This is then adjusted by a subjective factor of +10% (within a range of +/- 25% for the
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns.
BNP-T $28.68 $33.00 BUY High Our target price reflects a base valuation of $31.58 that combines 1.0x our modified growth NAV of $34.82 at a 65% weighting and $25.58 using an
EV/DACF multiple of 7.4x 2011E DACF at a 35% weighting. This is then adjusted by a subjective factor of +5% (within a range of +/- 25% for the sector).
BTE-T $46.50 $52.00 BUY High Our target price reflects a base valuation of $49.43 that combines 1.0x our modified growth NAV of $52.67 at a 65% weighting and $43.41 using an
sector).
CLT-T $17.08 $18.00 HOLD High Our target price reflects a base valuation of $14.88 that combines 1.0x our modified growth NAV of $12.06 at a 65% weighting and $20.12 using an
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to Celtic include asset
concentration of the capital program in the Kaybob region. Also a risk is the asset concentration where a high % of total production comes from 25 wells.
CPG-T $42.38 $45.00 HOLD High Our target price reflects a base valuation of $39.03 that combines 1.0x our modified growth NAV of $38.85 at a 65% weighting and $39.36 using an
sector).
CR-T $19.39 $24.00 BUY High Our target price reflects a base valuation of $21.38 that combines 1.0x our modified growth NAV of $21.48 at a 65% weighting and $21.19 using an
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to Crew includes the asset
concentration where a high % of total production comes from 25 wells.
DAY-T $9.98 $11.00 BUY High Our target price reflects a base valuation of $10.30 that combines 1.0x our modified growth NAV of $11.91 at a 65% weighting and $7.31 using an
ERF-T $31.08 $35.00 BUY High Our target price reflects a base valuation of $32.57 that combines 1.0x our modified growth NAV of $34.89 at a 65% weighting and $28.26 using an
EV/DACF multiple of 7.5x 2011E DACF at a 35% weighting. This is then adjusted by a subjective factor of +7.5% (within a range of +/- 25% for the
sector).
FRU-T $20.94 $19.00 HOLD High Our target price reflects a base valuation of $15.55 that combines 1.0x our modified growth NAV of $16.55 at a 65% weighting and $13.67 using an
sector).
NAE-T $12.75 $13.50 HOLD High Our target price reflects a base valuation of $13.42 that combines 1.0x our modified growth NAV of $14.04 at a 65% weighting and $12.26 using an
January 11, 2011
67 of 86
Ticker Price Target Rating Risk Justification of Target Prices and Key Risks
NVA-T $8.61 $12.00 BUY High Our target price reflects a base valuation of $13.53 that combines 1.0x our modified growth NAV of $12.34 at a 65% weighting and $15.75 using an
EV/DACF multiple of 6.0x 2011E DACF at a 35% weighting. This is then adjusted by a subjective factor of -10% (within a range of +/- 25% for the
sector).
PBN-T $21.78 $26.00 BUY High Our target price reflects a base valuation of $26.85 that combines 1.0x our modified growth NAV of $29.12 at a 65% weighting and $22.64 using an
EV/DACF multiple of 6.5x 2011E DACF at a 35% weighting. This is then adjusted by a subjective factor of -5% (within a range of +/- 25% for the sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to PetroBakken include the
impact of high first year decline rates on Bakken horizontal wells and variability in IP rates for Cardium horizontal wells.
PGF-T $12.89 $14.00 HOLD High Our target price reflects a base valuation of $13.57 that combines 1.0x our modified growth NAV of $14.56 at a 65% weighting and $11.74 using an
sector).
PMT-T $3.86 $3.75 HOLD High Our target price reflects a base valuation of $3.63 that combines 1.0x our modified growth NAV of $4.29 at a 65% weighting and $2.39 using an
POU-T $31.43 $26.00 REDUCE High Our target price reflects a base valuation of $22.83 that combines 1.0x our modified growth NAV of $27.49 at a 65% weighting and $14.17 using an
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks associated with Paramount
include the long term approach to development, which may not match an investor's profile, the allocation of capital to investments, the high ownership of
the Riddell family and management as well as the asset concentration where a high % of total production comes from 25 wells.
PRQ-T $12.31 $11.00 HOLD High Our target price reflects a base valuation of $10.21 that combines 1.0x our modified growth NAV of $10.99 at a 65% weighting and $8.74 using an
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to Progress include the asset
concentration in northeast British Columbia and the asset concentration as a high % of total production comes from 25 wells.
PWT-T $24.07 $28.00 BUY High Our target price reflects a base valuation of $27.82 that combines 1.0x our modified growth NAV of $30.43 at a 65% weighting and $22.98 using an
TET-T $12.10 $13.50 HOLD High Our target price reflects a base valuation of $12.44 that combines 1.0x our modified growth NAV of $9.44 at a 65% weighting and $17.99 using an
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to Trilogy include the asset
concentration in the Kaybob area.
VET-T $46.12 $42.00 HOLD High Our target price reflects a base valuation of $36.55 that combines 1.0x our modified growth NAV of $36.79 at a 65% weighting and $36.10 using an
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risk for Vermilion includes the fact
that it operates internationally in France, Australia, Netherlands and Ireland as well as the timing for the production of its Corrib offshore Ireland gas
property.
ZAR-T $22.09 $19.50 HOLD High Our target price reflects a base valuation of $20.50 that combines 1.0x our modified growth NAV of $22.03 at a 65% weighting and $17.66 using an
EV/DACF multiple of 6.2x 2011E DACF at a 35% weighting. This is then adjusted by a subjective factor of -2.5% (within a range of +/- 25% for the
sector).
regulations, legislation, royalties, taxes, exchange rates, interest rates, environmental and weather concerns. Specific risks to Zargon includes the asset
concentration where a high % of total production comes from 25 wells.
January 11, 2011
68 of 86
Industrial Products November Building Permits Disappoint

Strong Quebec Institutional Permits Offset by Non-Res Weakness
Michael Tupholme, CFA
Weak British Columbia Residential Permits Drag Down National Level
Vahan Ajamian, CA (Associate)
Event
Yesterday morning, Statistics Canada released Canadian building permits data for
November 2010.
Impact
NEGATIVE. Nationally, the value of total building permits fell 10.3% year-over-
All figures in C$, unless otherwise specified. year. On a sequential basis, total permit values fell 11.2% to $5.5 billion, versus
consensus expectations of a 1.5% increase.
Details
• The value of non-residential building permits totaled $2.3 billion in
November, up 7.9% year-over-year but down 16.1% sequentially. Quebec
posted a 29.2% sequential increase to $554 million, the highest level since
March 1998, driven by strong institutional and government permit levels. In
contrast, the other three ‘Big Four’ provinces posted declines. The most notable
decline was in Ontario, where the value of commercial permits fell $329
million or 43.1% sequentially due to lower intentions for laboratories, which
had posted a large gain in October.
• All three categories of non-residential permits pulled back sequentially in
November, with Commercial falling the furthest versus a tough comp. The main
driver of Institutional and Government permit weakness was lower construction
intentions for educational institutions in all provinces except New
Brunswick. The value of Industrial permits was essentially flat sequentially,
with gains in transportation buildings in Ontario and utilities buildings in Alberta
helping to offset broad based weakness.
• The value of residential building permits fell 20.2% year-over-year and
7.2% sequentially to $3.2 billion, representing the lowest value in 15
months. While eight provinces and territories advanced, the $405 million
(51.0%) sequential decline in British Columbia was by far the largest factor
in the $247 million decline nationally. British Columbia posted its lowest level
($389 million) in 15 months after reaching a three-year high in October; and ex-
British Columbia, residential permits rose 6.0%. Nationally, permit values for
single family dwellings rose 3.4% sequentially, while permit values for multi-
family dwellings fell 22.4%.
• Municipally, Montreal posted the largest gains both year-over-year and
sequentially ($64 million and $90 million respectively) driven by broad based
strength. The largest year-over-year decline arose in Edmonton (-$242 million),
while Vancouver fell the most sequentially (-$515 million) versus a tough comp.
Overall, we view November 2010 as a weak month for building permits, a leading
indicator of construction activity. Non-residential building permits, which are more
relevant for the companies we cover, fared poorly versus a strong comp, but were
only modestly below their trailing twelve month average. However, we are concerned
by the steady erosion in the value of residential permits over the past several months,
which are now 25% below their recent high set in March 2010.
January 11, 2011
69 of 86
At present, generally we favour the engineering-focused stocks over the construction-focused names and
building materials stocks in our coverage universe for a number of reasons, notably:
1) uncertainty surrounding margin recovery in the construction space;
2) our belief that generally investors are going to want to see tangible evidence of improved margin
performance before momentum in construction and buildings materials stocks starts to build in a
meaningful way; and
3) near-term catalysts (primarily acquisitions) tend to favour engineering-focused names.
With respect to the companies we cover, we highlight the following:

• Armtec Infrastructure Inc. (ARF-T), GENIVAR Inc. (GNV-T), and SNC-Lavalin Group Inc. (SNC-T),
as having some exposure to the strong Quebec institutional and government market.
• Armtec, Bird Construction Inc. (BDT-T), GENIVAR, Stantec Inc. (STN-T,N) and Wajax Corp. (WJX-
T) as having exposure to the weaker Ontario commercial market.
• Aecon Group Inc. (ARE-T), Bird, The Churchill Corp. (CUQ-T), GENIVAR and Stantec as having
exposure to the weaker educational market.
• Armtec and Stantec as having exposure to the weaker national residential market.
Exhibit 1. Value of Building Permits (seasonally adjusted, millions)
Non-Residential Construction Monthly Value Trailing Twelve Months

Nov-09 Oct-10 Nov-10 Yr/Yr % Seq % Nov-09 Oct-10 Nov-10 Yr/Yr %
Quebec $340 $429 $554 63.1% 29.2% $391 $402 $419 7.3%
Ontario $829 $1,134 $892 7.7% -21.3% $785 $1,045 $1,050 33.8%
Alberta $490 $357 $347 -29.0% -2.7% $466 $417 $405 -13.2%
BC $241 $370 $270 12.2% -27.1% $258 $248 $250 -2.8%
National $2,143 $2,756 $2,313 7.9% -16.1% $2,186 $2,401 $2,416 10.5%
Residential Construction
Quebec $790 $675 $776 -1.8% 14.9% $693 $852 $851 22.9%
Ontario $1,609 $1,055 $1,148 -28.6% 8.8% $1,006 $1,323 $1,285 27.7%
Alberta $631 $487 $448 -29.0% -8.1% $434 $592 $576 32.7%
BC $539 $793 $389 -27.9% -51.0% $334 $598 $585 75.0%
National $3,980 $3,424 $3,177 -20.2% -7.2% $2,792 $3,768 $3,701 32.6%
Total Construction
Quebec $1,130 $1,104 $1,330 17.7% 20.5% $1,083 $1,254 $1,270 17.3%
Ontario $2,437 $2,189 $2,040 -16.3% -6.8% $1,791 $2,368 $2,335 30.4%
Alberta $1,120 $844 $795 -29.0% -5.8% $900 $1,008 $981 9.0%
BC $779 $1,164 $658 -15.5% -43.4% $592 $846 $836 41.2%
National $6,123 $6,180 $5,490 -10.3% -11.2% $4,978 $6,169 $6,116 22.9%
Non-Residential Construction Breakdown - National

Industrial $298 $409 $406 36.3% -0.9% $338 $396 $405 19.8%
Commercial $1,179 $1,645 $1,261 6.9% -23.4% $1,130 $1,294 $1,300 15.0%
Institutional & Government $667 $701 $647 -3.0% -7.8% $718 $712 $710 -1.1%
% Institutional & Government 31.1% 25.4% 28.0% -315 bps 252 bps 32.8% 29.6% 29.4% -344 bps
Source: Statistics Canada

January 11, 2011
70 of 86
Exhibit 2. Comparison of Growth Rates Between “Big 4” Provinces & “Small 9” Provinces and
Territories in September
National Growth Rate

Yr/Yr % Seq %
Non-Residential Construction
"Big 4" Provinces 8.7% -9.9%
"Small 9" Provinces & Territories 1.9% -46.4%
"Big 4" Outperformance (Underperformance) 6.8% 36.5%
Residential Construction
"Big 4" Provinces -22.7% -8.3%
"Small 9" Provinces & Territories 1.4% 1.1%
"Big 4" Outperformance (Underperformance) -24.0% -9.4%
Total Construction
"Big 4" Provinces -11.8% -9.0%
"Small 9" Provinces & Territories 1.6% -24.1%
"Big 4" Outperformance (Underperformance) -13.4% 15.1%
Source: Statistics Canada.
Exhibit 3. Value of Total Canadian Building Permits ($b)
Canada
$7.0
$6.0 CAGR: 4.7%
$5.0
$4.0
$3.0
$2.0
$1.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Actual Monthly Value Trailing Twelve Month Average

January 11, 2011
71 of 86
Exhibit 4. Value of Non-Residential Building Permits ($b)
Canada
$3.5
$3.0 CAGR: 3.7%
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Quebec
$0.6
CAGR: 6.1%
$0.5
$0.4
$0.3
$0.2
$0.1
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Ontario
$1.6
$1.4 CAGR: 3.9%
$1.2
$1.0
$0.8
$0.6
$0.4
$0.2
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10

January 11, 2011
72 of 86
Exhibit 4. Value of Non-Residential Building Permits ($b) cont’d
Alberta
$0.8
$0.7 CAGR: 2.1%
$0.6
$0.5
$0.4
$0.3
$0.2
$0.1
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
British Columbia
$0.5
CAGR: 3.2%
$0.4
$0.3
$0.2
$0.1
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10

Exhibit 5. Value of Institutional and Government Permits as a Percentage of Total Non-Residential; Canadian
Building Permits (LTM Average)
45%
Jul-83 Peak: 41.0%
40%
Sep-93 Peak: 35.5% Nov-09 Peak: 32.8%
Historic Avg: 25.9%
Oct-03 Peak: 33.3% Current: 29.4%
35% 5 Year Avg: 27.3%
10 Year Avg: 27.6%
30%
25%
May-07 & Sep-07 Troughs: 23.0%

20%
Apr-81 Trough: 19.7%
Dec-89 Trough: 16.2% Jul-97 & Jan-99 Troughs: 19.0%
15%
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10

January 11, 2011
73 of 86
Exhibit 6. Value of Non-Residential Permits (year-over-year change, LTM Average)
50%
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
-50%
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Industrial Commerical Institutional & Government
Exhibit 7. Value of Canadian Residential Building Permits ($b)
Canada
$4.5
$4.0 CAGR: 5.6%
$3.5
$3.0
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Quebec
$1.0
$0.9 CAGR: 7.2%
$0.8
$0.7
$0.6
$0.5
$0.4
$0.3
$0.2
$0.1
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10

January 11, 2011
74 of 86
Exhibit 7. Value of Canadian Residential Building Permits ($b) cont’d
Ontario
$1.6
$1.4 CAGR: 6.1%
$1.2
$1.0
$0.8
$0.6
$0.4
$0.2
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Alberta
$0.8
$0.7 CAGR: 4.6%
$0.6
$0.5
$0.4
$0.3
$0.2
$0.1
$0.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
British Columbia
$0.9
$0.8 CAGR: 2.2%
$0.7
$0.6
$0.5
$0.4
$0.3
$0.2
$0.1
$0.0
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10

January 11, 2011
75 of 86
Exhibit 8. Justifications of Target Prices
12-Month Overall Risk

Stock Name Ticker Exchange Share Price Target Recommendation Rating Justification of Target Price
We value the EV of the core construction business by applying a 6.25x
multiple to our 2011 estimated nonconcession EBITDA, less net recourse
Aecon Group Inc. ARE T $10.02 $12.50 HOLD MEDIUM
debt and minority interest, plus the value of Aecon’s non-concession cash
and concession assets.
Our target price is based on an EV/EBITDA multiple of 8.25x our 2011
Armtec Infrastructure Inc. ARF T $16.12 $19.50 HOLD MEDIUM
EBITDA estimate, less the value of Armtec’s forecasted net debt.
Our target is based on an EV/EBITDA multiple of 5.5x our 2011 EBITDA
Bird Construction Inc. BDT T $36.82 $36.00 HOLD MEDIUM
estimate, less the value of Bird’s forecast net debt.
Our target price is derived by applying a 8.5x multiple to our 2011 EBITDA
Genivar Inc. GNV T $31.60 $34.00 BUY MEDIUM
estimate, less the value of GENIVAR’s forecast net debt.
Our target price is derived based on the average of two sum-of-the-parts
valuations: (1) 10.5x our 2011E core E&C EBITDA less recourse debt, plus
SNC-Lavalin Group Inc. SNC T $58.95 $65.00 BUY MEDIUM the estimated value of SNC's concession assets, plus our forecasted
freehold cash at the end of 2010 (2) 17.5x our 2011E core E&C EPS, plus
the value of SNC's concession assets.
Our target price is based on a 9.0x multiple to our 2011 EBITDA estimate
Stantec Inc. STN T,N $27.85 $36.00 BUY MEDIUM
less the value of Stantec’s forecasted net debt.
Our target price is based on an EV/EBITDA multiple of 5.25x our 2011
The Churchill Corporation CUQ T $17.66 $25.00 BUY MEDIUM
EBITDA estimate, less the value of Churchill’s forecast net debt.
Our target price is based on a P/E multiple of 14.5-15.0x our fully-taxed
Wajax Corp. WJX T $35.55 $40.00 BUY MEDIUM
2011 EPS estimate.
January 11, 2011
76 of 86
Exhibit 9. Key Risks to Target Prices
12-Month Overall Risk

Stock Name Ticker Exchange Share Price Target Recommendation Rating Key Risks to Target Price
Political risk in Ecuador; Buildings segment performance; margin

contraction; sector multiple contraction; reputational risk; labour shortages;
Aecon Group Inc. ARE T $10.02 $12.50 HOLD MEDIUM interest rate increases; cyclicality and seasonality of the construction
industry; industry competition; reduction in backlog; fixed price contracts;
cost overruns and timing delays; concession-related risks.
Potential slowdown in capital spending; changes in government policies,

regulations or standards; capital availability and increased borrowing costs;
potential for margin pressure; cyclicality and seasonality; product
performance and liability risks; acquisition/expansion risks; risk of early
Armtec Infrastructure Inc. ARF T $16.12 $19.50 HOLD MEDIUM
conversion to a corporate structure; industry competition; delays or
cancellation of backlog; supplier risks; labour shortages and availability of
skilled personnel; expiration of rights under license and distribution
agreements and interest rate risk.
Slowdown in non-residential capital spending, potential margin pressure,

labour shortages, contraction in sector multiples, declining oil prices,
reputational risk, the potential for interest rate increases to cause
Bird Construction Inc. BDT T $36.82 $36.00 HOLD MEDIUM
customers to delay, scale back or cancel projects, construction industry
cyclicality and seasonality, competition, reduction in backlog, and project
cost overruns and timing delays.
Ability to maintain and manage growth; significant margin contraction;
reputational risk; shortage of engineers; interest rate increases; cyclicality
and seasonality of the construction industry; industry competition;
Genivar Inc. GNV T $31.60 $34.00 BUY MEDIUM acquisition-related risks; reduction of backlog; dependence on Quebec;
dependence on public sector; limited ceiling and fixed price contracts;
insurance levels maintained; reduction in distribution; high levels of
goodwill and intangible assets.
Maintaining and managing growth; margin contraction; sector multiple
contraction; reputational risk; fixed price contracts; project cost
SNC-Lavalin Group Inc. SNC T $58.95 $65.00 BUY MEDIUM overruns/timing delays; labour shortages; interest rate increases; cyclicality
and seasonality of the construction industry; industry competition;
international risks; and concession risks.
Ability to maintain and manage growth; significant margin contraction;

reputational and liability risk; shortage of engineers; interest rate increases;
Stantec Inc. STN T,N $27.85 $36.00 BUY MEDIUM
cyclicality and seasonality of construction industry; industry competition;
self insurance; the execution of work under fixed price contracts.
Slowdown in non-residential capital spending; margin pressure; labour

shortages; sector multiple contraction; dependence on western Canada;
declining oil prices; reputational risk; collective bargaining risks; the
The Churchill Corporation CUQ T $17.66 $25.00 BUY MEDIUM potential for interest rate increases to cause customers to delay, scale
back or cancel projects; construction industry cyclicality and seasonality;
competition; reduction in backlog; acquisition-related risks; and project cost
overruns and timing delays.
Deterioration in economic growth, business cyclicality, commodity price

declines, manufacturer relationships and product access, quality of
products distributed, industry competition, pricing of maintenance and
Wajax Corp. WJX T $35.55 $40.00 BUY MEDIUM repair contracts, acquisition and expansion risks, early conversion to
corporate structure, potential reduction in distributions,
delays/cancellations in backlog, labour relations, rising interest rates and
f/x fluctuations.
January 11, 2011
77 of 86
Media Canadian Media Industry Review 2011

Back From the Abyss and Back with a Vengeance
Scott Cuthbertson
Michael Elkins, CA, CFA

Performance summary for 2010. Canadian media stocks collectively returned
18.8% in 2010, versus the S&P/TSX Composite’s 17.6%. Drilling down, performance
was divergent across the space, with companies having a high degree of operational
leverage and economic sensitivity outperforming to a meaningful degree. Our Action
List picks had an excellent year, returning 88.4%, driven primarily by Torstar Corp.
All figures in C$, unless otherwise specified. (TS.B-T) and Transcontinental Inc. (TCL.A-T), which were our top picks for most of
the year.
Top picks for 2011. Our top pick for 2011 is Torstar, followed by
Transcontinental and Quad/Graphics Inc. (QUAD-N). While we believe that there
is some potential for more multiple expansion in certain sectors of the Canadian
media universe, the majority of future share price gains will likely be driven by
improving financial momentum. Our top picks in the sector reflect this, because each
has what we would consider an attractive current valuation, but, more importantly,
have exposure and leverage to a recovering advertising market and/or other fairly
visible sources of financial momentum.
Advertising market outlook for 2011. The Canadian advertising market rebounded
strongly in 2010 growing 5% following a very challenging 2009, during which we
saw the biggest, and only the fourth annual decline in advertising since record keeping
began in 1963. We expect growth to slow in 2011, but remain healthy at 4.4%, led
by continued strong performance in internet advertising and specialty television.
While growth in most traditional media will likely remain positive, fragmentation
from emerging media will also likely continue. If our current forecast proves correct,
the internet will overtake conventional television to become the largest advertising
medium in Canada in 2012.
Top media trends for 2011. The media industry is in constant flux with emerging
technologies altering how and what content is consumed. Three trends that are likely
to have a significant impact on media in 2011 are the emergence of tablet PC’s, TV
web convergence and the emergence of a new publishing model. In addition, we
expect some changes to the Canadian media business this year stemming from recent
consolidation. While each of these trends is likely to have its own unique impact on
media in Canada, we believe that the broad implications will include an increase in
time spent with media, a greater demand for ‘on demand’ video content, the potential
for material changes in how publishers do business, and a shift in strategy by
Broadcast Distribution Undertakings (BDUs – cable and satellite distributors) to
factor in their ownership of conventional television networks.

January 11, 2011
78 of 86
Exhibit 1: Potential All-In Returns Within our Coverage Universe
60.0%
Potential All-In Return
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
O
VC
M
X
TS
A
AD
JR
X
L
TC
TV
H
G
C
YL
AC
C
G
U
C
Q
Source: Thomson, TD Newcrest
Conclusion
We believe that the advertising industry is recovering nicely as all major fundamental indicators are
pointing in the right direction. While the media space remains a dynamic one with many trends having an
impact on both existing and relatively new business models, this health is broadly based at present, benefiting
both incumbent and new media properties. Some share prices reflect their potential while others appear to
have been overlooked, creating what we believe are good investment opportunities in select names. We invite
you to read the complete report for much more detail.
January 11, 2011
79 of 86
Appendix One: Justification of Target Prices
Company Recommendation Share Price Target Justification of Target Price

Astral Media Inc. HOLD $41.44 $43.00 Our $43.00 target price represents 8.4x F2012
EV/EBITDA.
Canadian Satellite Radio ------------------------------------------------Restricted---------------------------------------------------

Holdings Inc.
Corus Entertainment Inc. BUY $22.77 $25.00 Our $25.00 target price represents 8.5x F24M
EV/EBITDA and 14.2x forward FD EPS.
Cineplex Inc HOLD $22.76 $24.00 Our $24.00 target price is based on 8.3x EBITDA for
the 12 months ended September 30, 2012. This is a
discount to the funds historical average of 8.7x.
DHX Media BUY $0.96 $1.40 Our target represents 7.5x FWD 24mo EBITDA of the
legacy DHX business (plus the impact of the UMIGO
property) and includes $0.10 in option value for the
Animal Mechanical’s property. To this we add the
W!LDBRAIN business at the value that we believe
DHX will ultimately pay for the assets (including an
estimate of USD $4.75 million to be paid as part of
the earn-out) believing that it fairly reflects their value.
We may consider alternate values for W!LDBRAIN as
more detail on them is provided and more clarity on
the sustainability of their earnings is revealed.
Glacier Media Inc BUY $2.51 $3.25 Our $3.25 target price uses our estimate of net debt
as of Sept 30, 2011 against 7.2x forecast EBITDA for
the 12 months ending September 20, 2012, in line
with where the shares are trading currently.
Newfoundland Capital Corp. HOLD $6.80 $7.50 Our $7.50 target price represents 8.7x EBITDA for the
Ltd. 12 months ending Sept 30, 2012.
Quad/Graphics BUY $US42.700 $US65.00 Our $65.00 target price is based upon an EV/EBITDA
ratio of 4.9x using our estimate of net debt at the end
of Q4/11 and EBITDA for the 12 months ending
Q4/12, in line with where the comps are trading on a
current year basis.
Torstar Corp. AL BUY $12.50 $16.50 Our $16.50 target price represents 5.0x EV/EBITDA
for the 12 month period ending September 30, 2012.
Transcontinental Inc. BUY $16.42 $19.00 Our $19.00 target price represents 5.1x F2012
EV/EBITDA.
TVA Group Inc. BUY $14.75 $15.00 Our $15.00 target represents 5.1x EV/EBITDA for the
12 months ending September 30, 2012.
Yellow Media HOLD $6.15 $5.50 Our $5.50 target price represents 6.7x F24M
EV/EBITDA.
January 11, 2011
80 of 86
Appendix Two: Key Risks to Target Prices
Company Recommendation Share Price Target Key Risks to Target Price Risk Rating
Astral Media Inc. HOLD $41.44 $43.00 Key risks: (1) Execution risk on the implementation of MEDIUM
the Toronto Street Furniture contract could result in
different financial performance than anticipated. (2)
Potential for Astral to bid on the Ottawa and/or
Montreal street furniture contract. (3) Exposure to the
advertising market and by extension economic
variability. (4) Subordinate voting share structure: (The
Greenberg family controls 57.9% of votes).
Canadian Satellite Radio ----------------------------------------------------Restricted------------------------------------------------------

Holdings Inc.
Corus Entertainment Inc. BUY $22.77 $25.00 Key risks include: (1) Exposure to the advertising MEDIUM
market and, by extension, to economic cyclicality.
Approximately 58% of Corus’ revenue comes from
advertising; (2) Exposure to content which can be
inherently volatile; (3) Subordinate voting share struct
Cineplex Inc HOLD $22.76 $24.00 (1) The box office is highly dependent on the quality of MEDIUM
the film slate; (2) the appeal of 3D may deteriorate; (3)
the length of the box office window may decline; (4) the
relative appeal of film exhibition may deteriorate; (5)
the financing of the conversion to digital cinema may
not be as favorable to Cineplex as we expect; (6)
increases in the minimum wage; (7) new competition
may displace Cineplex’s dominant market position; (8)
sensitivity to higher interest rates.
DHX Media BUY $0.96 $1.40 (1) Material adverse change to the Canadian regulatory HIGH
environment, (2) regulatory constraints against
advertising to children, (3) concentration risk, (4) loss
and inability to replace a successful series, (5)
departure of key personnel, (6) competition, (7) access
to interim production financing, (8) exposure to the film
and television production industry, (9) accounting
policies subject to considerable estimate.
Glacier Media Inc BUY $2.51 $3.25 (1) Exposure to the advertising market; (2) exposure to MEDIUM
print media; (3) exposure to FX and newsprint costs;
(4) dependence on key personal; (5) integration risk;
(6) significant ownership concentration; (7) a history of
making acquisitions financed through equity which
have the potential to be dilutive; (8) management’s
ability to manage growth.
Newfoundland Capital HOLD $6.80 $7.50 Key risks include: (1) Integration risk. Newfoundland MEDIUM
Corp. Ltd. Capital is extremely active in launching, converting and
turning around stations it has recently acquired. This
could cause variations in financial performance
affecting valuation. (2) Exposure to the radio
advertising market, which has poor visibility. (3)
Subordinate voting share structure:(the Steele family
controls 96.4% of votes ).
Company Recommendation Share Price Target Key Risks to Target Price Risk Rating
Quad/Graphics BUY $US42.700 $US65.00 (1) Synergies may not be realized or may take longer MEDIUM
to realize than forecast; (2) integration between Quad
and World Color may not go as smoothly as hoped; (3)
highly competitive industry. Although most contracts
are long term, there could be a competitive response
from others in this business, impacting pricing or other
dynamics; (4) economic risk. Quad’s revenues are
largely driven by advertising demand which in turn is
sensitive to economic cyclicality; (5) subordinate voting
share structure. (Quadracci family controls 76% of
votes).
Torstar Corp. AL BUY $12.50 $16.50 Key risks include: (1) Exposure to the daily newspaper MEDIUM
business. (2) Exposure to the advertising market. (3)
Fluctuations in foreign exchange and newsprint costs.
(4) Subordinate voting share structure: (five families
control 94.1% of the votes)
Transcontinental Inc. BUY $16.42 $19.00 Key risks include: (1) foreign exchange exposure (2) MEDIUM
economic sensitivity of the printing and publishing
sectors (3) risk associated with executing long term
newspaper print outsourcing contracts (4) ability to
migrate business from print to a broader array of online
products and services (5) exposure to the advertising
industry and (6) subordinate voting share structure.
(Marcoux family controls 64.5% of votes.)
TVA Group Inc. BUY $14.75 $15.00 Key risks include: (1) The magazine market in Quebec MEDIUM
is highly competitive, resulting in considerable volatility.
(2) SunTV is still essentially a start up operation, and
therefore volatile and lacks visibility. Its economic
viability long term remains a question mark. (3)
Significant volatility in the distribution business/little
apparent economic reason for involvement. (4)
Exposure to the advertising market. (5) Subordinate
voting share structure (Quebecor Media controls 99%
of the votes).
Yellow Media HOLD $6.15 $5.50 Key risks include: (1) exposure to the cyclical MEDIUM
advertising market, (2) emerging competitive offerings
could erode YLO’s current market share, (3) print
directory growth may decline faster than expected and
may not recover, (4) risk that Dealer Smart Solutions
and other important new initiatives may not achieve
significant penetration and (5) risk that pension assets
decline.
January 11, 2011
81 of 86
Technology - Hardware Chris Umiastowski, P. Eng., MBA Matthew Elliott, CFA (Associate)
Unchanged
Risk: HIGH
Prior:
C$0.55↓
C$0.60
Enablence Technologies Inc.
(ENA-V) C$0.49
Market Data (C$)
Current Price $0.49
December Quarter Guidance Reduced
52-Wk Range $0.39-$0.77
Enablence reduced its guidance for Q2/11 (December).
Dividend Yield 0.0%
Avg. Daily Trading Vol. (3mths) 351199
Fiscal Y-E June Negative. The company appears to have fallen short of its sales target
Shares O/S (f.d.)(mm) 420.8 because it was unable to recognize revenue from two orders in the quarter as
Net Cash ($mm) $10.3
expected. As a result, revenues are now expected to fall below the company’s
Net Debt/Tot Cap (11.4%) prior guidance and our previous estimate. The company did not change its
BVPS (f.d.) $0.23 full year revenue target, however we are less confident that it can reach this
Estimates (C$) goal. We have trimmed our estimates and have reduced our target price to
Year 2009A 2010A 2011E 2012E $0.55.
Sales ($mm) 45.2 53.9 137.0 164.9
Sales (old)($mm) -- -- 140.0 167.0
Details
EPS (f.d.) (0.18) (0.06) (0.01) 0.02
EPS (f.d.)(old) -- -- 0.00 0.02
Enablence warned on sales for its December quarter. The company now
expects Q2/11 revenues to be in the range of $34-$35 million. At the mid-
EPS (f.d.) Quarterly Estimates (C$)
Year 2009A 2010A 2011E 2012E
points, the new range is 19% lower than the company’s prior outlook, which
Q1 (0.04) (0.02) (0.01) 0.00 expected revenues to be in the range of $40-$45 million. The company also
Q2 (0.04) (0.02) (0.01) 0.00 expects to report negative adjusted EBITDA in the range of $1 to $2 million.
Q3 (0.04) (0.01) 0.00 0.01 We had expected the company to meet the low end of its prior revenue
Q4 (0.06) (0.02) 0.00 0.01
guidance range, and had estimated sales of $40.1 million.
Valuations
Year 2009A 2010A 2011E 2012E
P/Sales (f.d.) 4.6x 3.8x 1.5x 1.3x
The timing on two orders slipped into Q3/11. Initially, two orders
P/E (f.d.) nmf nmf nmf 24.5x representing combined revenues of about $6 million were expected to close in
December. It appears that the timing of these two orders has slipped out of
the December quarter, and will instead be booked in the March quarter (Q3).
All figures in C$, unless otherwise specified. Had the revenue from these two orders been recognized as expected in
December, the company may have still met its Q2 guidance.
No change to full year guidance. With its announcement, the company did
not change its full year revenue outlook of $140 to $150 million. In our view
this suggests that Enablence’s pipeline has not changed and that the slippage
on those two orders will not flow through the rest of the company’s
opportunities. We have taken a more conservative view. In prior conference
calls, management had seemed most confident on its pipeline of orders for the
first half of the year, while meeting its full year sales target required the
company to convert on less certain opportunities in the second half of the
ENA-V: Price
Company Profile 6 6
Enablence is a development stage company 5 5
that designs and manufactures optical
4 4
components for the fiber to the home (FTTH)
market. 3 3
2 2
1 1
0 0
January 11, 2011
82 of 86
year. Following the Q2/11 revenue miss, we are less confident that the company will be able to win enough
new business in the second half to meet its full year sales target range. We would also not be surprised to see
additional revenue opportunities slip from F2011 into future periods. As we detail in the next section, we have
reduced our estimates and now expect the company to fall slightly below its full year revenue target range.
Outlook
We have reduced our estimates for Enablence. We have trimmed our Q2/11 estimates to be in-line with the
company’s new guidance range for revenues and adjusted EBITDA. We now model sales of $34.1 million
(was $40.1 million previously) and a loss of just more than $1 million in adjusted EBITDA. The company
now expects to recognize $6 million in sales in the March quarter on two orders that were originally expected
to close in December. With this in mind, we have increased our Q3 estimate to reflect this timing shift.
However we have become more conservative with our sales forecast for the remainder of F2011 and have
reduced our full year estimates. For F2011, we now expect revenues of $137 million (was $140 million) and a
loss of one penny per share (was breakeven). For F2012 we now estimate revenues of $165 million (was $167
million). Our F2012 EPS estimate is unchanged at $0.02.
Exhibit 1. TD Newcrest Enablence Model Summary
Current Estimates Prior Estimates

2009A 2010A Q1/11 Q2/11 Q3/11 Q4/11 2011E 2012E 2011E 2012E
Revenue ($000) 45,238 53,892 28,059 34,059 38,502 36,427 137,047 164,855 139,990 167,041
Gross margin, % 24.6% 21.2% 31.7% 35.4% 39.9% 39.3% 37.0% 39.3% 38.2% 39.8%
R&D, % 37.1% 26.0% 19.1% 16.1% 14.3% 15.1% 16.0% 13.3% 15.6% 13.2%
S&M, % 26.7% 23.9% 17.6% 15.5% 15.0% 15.0% 23.4% 20.4% 23.4% 20.3%
G&A, % 21.5% 14.4% 10.2% 12.0% 11.0% 11.0% 8.7% 7.3% 8.5% 7.2%
Operating margin, % -54.2% -38.0% -15.3% -4.5% 4.6% 2.0% -2.4% 6.3% -0.3% 7.2%
EPS ($0.18) ($0.06) ($0.01) ($0.01) $0.00 $0.00 ($0.01) $0.02 ($0.00) $0.02
Valuation
We do not expect Enablence to generate material EPS over our forecast period, so in our view a price to
earnings multiple is not an appropriate valuation metric to use at this time. On a price to sales basis, Enablence
currently trades at about 1.5x our F2011 estimate and 1.3x our F2012 estimate. Based on consensus, Calix
trades at about 1.8x and JDSU trades at about 1.9x C2011 sales. The group trades at about 1.5x C2011 sales.
In our view, it is reasonable for Enablence to trade about in-line with its comparable group. Admittedly, the
company does not have a history of delivering what we would consider to be impressive financial results and it
went to market twice last calendar year for financing. However, we are pleased by Enablence’s new focus on
execution and believe that it has now assembled a product offering that makes it a competitive player across a
similar set of opportunities in the access market as its main peers (Calix and JDSU). In our view, CEO Tim
Thorsteinson has a history of building effective sales teams and has implemented the kind of changes that will
be critical for a smaller company like Enablence to keep pace with its competitors. We expect that in F2012
(June end) Enablence will grow revenues by 20% (organically) and will reach profitability. Based on
consensus estimates, JDSU is expected to show 9% revenue growth in F2012 (June end), though we note it is a
far more established and diversified player. Calix is expected to show 17.5% revenue growth in 2011 and 13%
growth in 2012 (December end). We believe that Enablence’s expected higher revenue growth and improving
profitability help justify a similar price to sales valuation on its shares as its more established peers.
January 11, 2011
83 of 86
Exhibit 2. Trading Multiples for Industry Comparables (calendarized)
P/E P/S EV/S

Company Ticker C2009A C2010E C2011E C2009A C2010E C2011E C2009A C2010E C2011E
Trading Multiples Based on Current Market Prices and TD Newcrest Estimates

Enablence (C$) ENA-V nmf nmf 63.9x 3.83x 2.51x 1.36x 3.64x 2.38x 1.29x
Trading Multiples of Industry Competitors Based on Consensus

Calix CALX-Q nmf 40.9x 26.8x 2.60x 2.13x 1.81x 2.16x 1.77x 1.51x
Cienna CIEN-Q nmf nmf 46.6x 3.27x 1.47x 1.15x 4.12x 1.85x 1.44x
JDS Uniphase Corp. JDSU-Q 134.2x 25.2x 20.4x 2.90x 2.19x 1.93x 2.61x 1.97x 1.74x
Oclaro OCLR-Q nmf 21.5x 15.0x 2.06x 1.34x 1.18x 1.89x 1.23x 1.08x
Finisar FNSR-Q 109.4x 23.9x 15.3x 4.68x 2.98x 2.32x 4.58x 2.92x 2.27x
Opnext OPXT-Q nmf nmf nmf 0.55x 0.54x 0.46x 0.21x 0.20x 0.17x
Average 121.8x 27.8x 24.8x 2.7x 1.8x 1.5x 2.6x 1.7x 1.4x
Source: Company reports, Thomson, TD Newcrest.

Our $0.55 target price is based on about 1.4-1.5x price to sales multiple of our F2012 sales estimate.

Key risks to our target price include: 1) Size and growth of the FTTH market; 2) Competitive pricing pressure;
3) Enablence’s market share; 4) Enablence’s cost performance; 5) Integration of acquisitions; 6) Enablence is
competing with potential customers through its Wave7 acquisition; 7) Potential IP disputes.
Enablence’s Q2 sales are expected to fall below our prior estimates and we have trimmed our full year forecast
and target price. However, with the company’s focus on execution and improved balance sheet following its
most recent equity raise, we have maintained our HOLD recommendation.
January 11, 2011
84 of 86
TD Newcrest Equity Research Disclosures

Company Ticker Disclosures
ACE Aviation Holdings Inc. ACE.A-T ACE.B-T 10, 13
ARC Resources Ltd. ARX-T 2, 4, 9
Advantage Oil & Gas Ltd. AAV-T 9
Aecon Group Inc. ARE-T 1, 2, 4, 9
Air Canada AC.A-T AC.B-T 1, 2, 4, 15
Alange Energy Corp. ALE-V n/a
Armtec Infrastructure Inc. ARF-T 1, 2, 4
Astral Media Inc. ACM.A-T 9, 14
Athabasca Oil Sands Corp. ATH-T 1, 2, 4, 9
BNK Petroleum Inc. BKX-T 2, 4
Bankers Petroleum Ltd. BNK-T BNK-L 1, 2, 4, 9
Baytex Energy Corp. BTE-T 2, 4
Bird Construction Inc. BDT-T n/a
BlackPearl Resources Inc. PXX-T 1, 2, 4, 9
Bonavista Energy Corp BNP-T 1, 2, 4
Canacol Energy Ltd. CNE-V n/a
Canadian Natural Resources Ltd. CNQ-T CNQ-N 2, 4, 9
Canadian Oil Sands Ltd. COS-T 9
Celtic Exploration Ltd. CLT-T 9
Cenovus Energy Inc. CVE-T CVE-N 2, 4, 9
Churchill Corp. (The) CUQ-T 1, 2, 4
Cineplex Inc. CGX-T n/a
Corus Entertainment Inc. CJR.B-T CJR-N 1, 2, 4, 9, 14
Crescent Point Energy Corp. CPG-T 1, 2, 4, 9
Crew Energy Inc. CR-T 2, 4, 9
DHX Media Ltd. DHX-T 1, 2, 4
Daylight Energy Ltd. DAY-T 2, 4, 9
Eldorado Gold Corp. ELD-T EGO-A 9
Enablence Technologies Inc. ENA-V 1, 2, 4
Encana Corp. ECA-N ECA-T 2, 4, 9
Enerplus Corp. ERF-T 2, 4, 9
Freehold Royalties Ltd. FRU-T 2, 4
GENIVAR Inc. GNV-T 2, 4
Glacier Media Inc. GVC-T n/a
Gran Tierra Energy Inc. GTE-T GTE-A 9
HudBay Minerals Inc. HBM-T 9
Husky Energy Inc. HSE-T 1, 2, 4, 9
Imperial Oil Ltd. IMO-T 9
MEG Energy Corp. MEG-T 1, 2, 4
NAL Energy Corp. NAE-T 1, 2, 4, 9
Newfoundland Capital Corp. Ltd. NCC.A-T 12
Nexen Inc. NXY-T NXY-N 2, 4, 9
Niko Resources Ltd. NKO-T 9
NuVista Energy Ltd. NVA-T 2, 9
Pacific Rubiales Energy Corp. PRE-T 9, 10
Paramount Resources Ltd. POU-T 1, 2, 4, 9
Pengrowth Energy Corp. PGF-T 9
Penn West Exploration PWT-T 9
Perpetual Energy Inc. PMT-T 1, 2, 4, 9
PetroBakken Energy Ltd. PBN-T 1,2, 4, 9
Petrobank Energy & Resources Ltd. PBG-T 1, 2, 4, 9, 10
Petrodorado Energy Ltd. PDQ-V n/a
Petrominerales Ltd. PMG-T 1, 2, 4, 9
Quad/Graphics, Inc. QUAD-N n/a
SNC-Lavalin Group Inc. SNC-T 9
Stantec Inc. STN-T STN-N n/a
Suncor Energy Inc. SU-T SU-N 2, 4, 9, 10
TMX Group Inc. X-T 9
TVA Group Inc. TVA.B-T 14
Talisman Energy Inc. TLM-T TLM-N 2, 4, 9
Torstar Corp. TS.B-T 14
TransAtlantic Petroleum Ltd. TNP-T TAT-A n/a
Transcontinental Inc. TCL.A-T 2, 4, 10, 12, 15
Trilogy Energy Corp. TET-T 2, 4, 9
Vermilion Energy Inc. VET-T 1, 2, 4, 9
Wajax Corp. WJX-T 1, 2, 4
Yellow Media Inc. YLO-T 1, 2, 4, 9
Zargon Oil & Gas Ltd. ZAR-T 2, 4
January 11, 2011
85 of 86
1. TD Securities Inc., TD Securities (USA) LLC or an affiliated company has managed or co-managed a public offering of securities within the last 12
months with respect to the subject company.
2. TD Securities Inc., TD Securities (USA) LLC or an affiliated company has received compensation for investment banking services within the last 12
months with respect to the subject company.
3. TD Securities Inc., TD Securities (USA) LLC or an affiliated company expects to receive compensation for investment banking services within the
next three months with respect to the subject company.
4. TD Securities Inc. or TD Securities (USA) LLC has provided investment banking services within the last 12 months with respect to the subject
company.
5. A long position in the securities of the subject company is held by the research analyst, by a member of the research analyst’s household, or in an
account over which the research analyst has discretion or control.
6. A short position in the securities of the subject company is held by the research analyst, by a member of the research analyst’s household, or in an
account over which the research analyst has discretion or control.
7. A long position in the derivative securities of the subject company is held by the research analyst, by a member of the research analyst’s
household, or in an account over which the research analyst has discretion or control.
8. A short position in the derivative securities of the subject company is held by the research analyst, by a member of the research analyst’s
household, or in an account over which the research analyst has discretion or control.
9. TD Securities Inc. and/or an affiliated company is a market maker, or is associated with the specialist that makes a market, in the securities of the
subject company.
10. TD Securities Inc. and/or affiliated companies own 1% or more of the equity securities of the subject company.
11. A partner, director or officer of TD Securities Inc. or TD Securities (USA) LLC, or a research analyst involved in the preparation of this report has,
during the preceding 12 months, provided services to the subject company for remuneration.
12. Subordinate voting shares.
13. Restricted voting shares.
14. Non-voting shares.
15. Common/variable voting shares.
16. Limited voting shares.
Additional Important Disclosures

TD Securities Inc is acting as strategic advisor to BNK Petroleum Inc with respect to the announced non-brokered private placement.
Petrobank Energy and Resources Ltd. owns 66% of Petrominerales. TD Securities Inc. acted as sole financial advisor to the independent committee of
Petrobank.
Pierre H. Lessard, President and CEO of SNC-Lavalin Group Inc., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities
Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank.
TD Securities Inc. is acting as Financial Advisor to Suncor Energy with respect to the divestiture of certain of their natural gas assets including 1) the
transaction between Suncor Energy and Direct Energy to sell certain natural gas properties includes properties known as Wildcat Hills, located near
Cochrane, Alberta and 2) the transaction between Suncor Energy and TAQA NORTH, a subsidiary of the Abu Dhabi National Energy Company PJSC
(TAQA), to sell certain natural gas properties.
TD Securities Inc is a participating dealer in the establishment of the Alpha Trading System along with other investment dealers - CIBC World Markets,
National Bank Financial, RBC Capital Markets, Canaccord Capital Corp., BMO Nesbitt Burns and Scotia Capital.
Price Graphs
Full disclosures for all companies covered by TD Newcrest can be viewed
at https://www.tdsresearch.com/equities/disclosures by TD Newcrest's
institutional equity clients.
Distribution of Research Ratings

Distribution of Research Ratings^ Investment Banking Services Provided*
REDUCE BUY
5% 54% 80%
70%
60%
50%
53%
40%
44%
30%
20%
HOLD 3%
10%
41%
0%
BUY HOLD REDUCE
Current as of January 5, 2011

^ Percentage of subject companies under each rating * Percentage of subject companies within each of the
category—BUY (covering Action List BUY, BUY and three categories (BUY, HOLD and REDUCE) for which
Spec. BUY ratings), HOLD and REDUCE (covering TD Securities Inc. has provided investment banking
TENDER and REDUCE ratings). services within the last 12 months.
January 11, 2011
86 of 86
Definition of Research Ratings

ACTION LIST BUY: The stock's total return is expected to exceed a minimum of 15%, on a risk-adjusted basis, over the next 12 months and it is a top
pick in the Analyst's sector.
BUY: The stock’s total return is expected to exceed a minimum of 15%, on a risk-adjusted basis, over the next 12 months.
SPECULATIVE BUY: The stock's total return is expected to exceed 30% over the next 12 months; however, there is material event risk associated with
the investment that could result in significant loss.
HOLD: The stock’s total return is expected to be between 0% and 15%, on a risk-adjusted basis, over the next 12 months.
TENDER: Investors are advised to tender their shares to a specific offer for the company's securities or to support a proposed combination reflecting our
view that a superior offer is not forthcoming.
REDUCE: The stock’s total return is expected to be negative over the next 12 months.
Overall Risk Rating in order of increasing risk: Low (7.1% of coverage universe), Medium (32.6%), High (49.9%), Speculative (10.4%)
Research Dissemination Policy

TD Newcrest makes its research products available in electronic and/or printed formats and simultaneously distributes them to its institutional clients
who are entitled to receive them. The Action Notes are distributed by email, and are available in PDFform on First Call, Bloomberg, Reuters, Capital IQ,
FactSet and TheMarkets.com Research Reports are distributed by email; they are also printed and distributed by courier to our entitled clients. PDFs
of Reports are available on First Call, Bloomberg and Reuters. All research is available by password to entitled institutional clients at
https://www.tdsresearch.com
Analyst Certification
Each analyst of TD Securities Inc. whose name appears on page 1 of this research report hereby certifies that (i) the recommendations and opinions
expressed in the research report accurately reflect the research analyst's personal views about any and all of the securities or issuers discussed herein
that are within the analyst’s coverage universe and (ii) no part of the research analyst's compensation was, is, or will be, directly or indirectly, related to
the provision of specific recommendations or views expressed by the research analyst in the research report.
Disclaimer
This report is produced entirely by TD Securities Inc. Although the information contained in this report has been obtained from sources that TD
Securities Inc. believes to be reliable, we do not guarantee its accuracy, and as such, the information may be incomplete or condensed. All opinions,
estimates and other information included in this report constitute our judgment as of the date hereof and are subject to change without notice. TD
Securities Inc. will furnish upon request publicly available information on which this report is based. TD Securities (USA) LLC has accepted
responsibility in the United States for the contents of this research. TD Securities Limited has accepted responsibility in Europe for the contents this
report. Canadian clients wishing to effect transactions in any security discussed should do so through a qualified salesperson of TD Securities Inc.
Canadian retail investors are served by TD Waterhouse Canada Inc., a subsidiary of The Toronto-Dominion Bank. U.S. clients wishing to effect
transactions in any security discussed should do so through a qualified salesperson of TD Securities (USA) LLC. European clients wishing to effect
transactions in any security discussed should do so through a qualified salesperson of TD Securities Limited. Insofar as the information on this report is
issued in the U.K. and Europe, it has been issued with the prior approval of TD Securities Limited and only to persons falling within Articles 19 and 49 of
the Financial Services & Markets Act 2000 (Financial Promotion) Order 2001, namely persons sufficiently expert to understand the risks involved. No
recipient may pass on the information contained in this report to any other person without the prior written consent of TD Securities Inc. TD Newcrest is
the trade name that TD Securities Inc., TD Securities (USA) LLC and TD Securities Limited use to market their institutional equity services. TD
Securities Inc., TD Securities (USA) LLC and TD Securities Limited are wholly owned subsidiaries of The Toronto-Dominion Bank. TD Securities Limited
is authorised and regulated by the Financial Services Authority. The activities of The Toronto-Dominion Bank under its Financial Services Licence are
regulated by the Australian Securities and Investment Commission in Australia. Copyright 2011 by TD Securities. All rights reserved.
Full disclosures for all companies covered by TD Newcrest can be viewed at https://www.tdsresearch.com/equities/disclosures by TD
Newcrest’s institutional equity clients.

TD Newcrest Action Notes January 11, 2011

Hochgeladen von

Dokumentinformationen

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

TD Newcrest Action Notes January 11, 2011

Hochgeladen von

Copyright:

Verfügbare Formate

January 11, 2011

Action Notes Equity Research

ACE Aviation Holdings Inc. (ACE.A-T, ACE.B-T) C$12.86 ...... 4

Advantage Oil & Gas Ltd. (AAV-T) C$6.72 ...... 7

Alange Energy Corp. (ALE-V) C$0.50 .... 10

Canacol Energy Ltd. (CNE-V) C$1.54 .... 14

Crescent Point Energy Corp. (CPG-T) C$42.38 .... 18

Eldorado Gold Corp. (ELD-T, EGO-A) C$16.90 .... 21

HudBay Minerals Inc. (HBM-T) C$16.21 .... 27

Nexen Inc. (NXY-T, NXY-N) C$21.82 .... 30

Paramount Resources Ltd. (POU-T) C$31.43 .... 35

Pengrowth Energy Corp. (PGF-T) C$12.85 .... 38

PetroBakken Energy Ltd. (PBN-T) C$21.78 .... 41

TMX Group Inc. (X-T) C$37.19 .... 46

Talisman Energy Inc. (TLM-T, TLM-N) C$22.20 .... 52

GENERAL COMPANY NOTES

Canadian Oil Sands Ltd. (COS-T) C$25.46 .... 55

Energy Producers .... 58

Industrial Products .... 68

INTRADAY NOTES (published January 10, 2011)

Enablence Technologies Inc. (ENA-V) C$0.49 .... 81

Transportation/Aerospace Tim James, CFA Scott Farley, CA (Associate)

We estimate that ACE’s holding company discount is currently 12.9%. With

Canada warrants. Air Canada is Canada's 10 10

Valuation and Justification of Target Price

Key Risks to Target Price

Current Market TDN Target

Air Canada (11%)

Remaining ACE Holding Company Net Asset Value (100%)

TOTAL ACE AVIATION NAV per share $14.76 $17.73

Target Holding Company Discount 10.0%

Exhibit 2: Justification and Key Risks to Target Prices of ACE Subsidiaries

Energy Producers - Intermediate Roger Serin, P.Eng. Aaron Bilkoski (Associate)

Alberta / B.C. border between Grande Prairie 6 6

Exhibit 1. Revised Commodity Price Forecast

Justification of Target Price

Key Risks to Target Price

TICKER TARGET RATING

Energy Producers - Internationals Jamie Somerville Wael Halaoui (Associate)

following a reverse takeover in July 2009 30 30

Exhibit 1. Alange: TD Newcrest Estimate Changes

Production (BOE/d) 2,920 2,920 - 6,013 6,013 -

CFPS - f.d. $0.02 $0.02 18% $0.10 $0.09 7%

Base NAVPS C$0.22 C$0.19 13%

Exhibit 2. Alange: Relative Valuation

Fully-risked NAVPS Base NAVPS 2012E EV/DACF

Average 0.74x 0.94x 2.36x 8.60x 6.7x 9.5x

Justification of Target Price

Exhibit 3. Alange: Target Price Calculation

Base NAVPS $0.22

Key Risks to Target Price

The key near-term risks specific to Alange are:

Exhibit 4. Alange: Summary

Alange Energy Corp. ALE TSX-V Rating BUY

Price C$0.49 Risk HIGH

Total 1,203 2,920 6,013 8,530

RESERVES 2009 2010 Proforma

ASSUMPTIONS 2009 2010E 2011E 2012E

RECENT FINANCINGS INSIDER OWNERSHIP BASIC f.d.

Source: Company Reports, Bloomberg, TD Newcrest.

Energy Producers - Internationals Jamie Somerville Wael Halaoui (Associate)

As published on December 8 in our TD International E&P 2011 Preview, we

Exhibit 1. Canacol: TD Newcrest Estimate Changes

Fiscal 2011E Fiscal 2012E