Connacher Oil & Gas Ltd CLLZF

RE: Analysts say record highs /sector1

[strzelin]

Good post as always. I agree with your mid and long term prospect for CLL. Having said this IMO CLL has two short term problems: 1.Q3 earnings will be about 50% lower then Q2(see my post for numbers).It is not CLL fault since commodity and refining margins are out of their control. What is bad about it that their conventional assets are not generating necessary free cash flow. 2.In next two months CLL will have to find 80 to $100 mln to support their winter CAPEX (drilling),operational expenses as well as $19.5mln of first Oilsnad Loan installment which is due in the end of this year(2007)according to the loan schedule. $100 mln debenture money raised in May/June offerings is gone. On Aug 28/2007 Mr Gusella said: "debenture funds were used to pay off short term bank debt and for paying bills associated with our capex at Great Divide." Possibilities: *New share issue: 20 mln shares bellow $4 per share *New 100mln debenture *Sell 1/2 of the PDP holdings *New loan-this will be very difficult to obtain in the credit crunch environment