Longview Oil Corp LGVWF

Cash Flow Sensitivity

[terroir]

Slide 6 of the December presentation outlines cash flow sensitivities for 2104 guidance, with recent moves in CDN$, reduced spread against WTI, level of WTI, and nat gas prices, it is obvious that the company is facing a nice start to the year's cash flow:

Cash Flow Sensitivities: 

Edmonton Light – US $5.00/bbl...........$4.2 million 

AECO Gas - $0.50/mcf ......................$1.1 million.

Oil Production – 200 bbls/d.................$5.2 million

 

Base expectations supporting guidance to $77 million cash flow are:

Edmonton light @ $93.5CDN based on $93US WTI @ .93cents exchange
              Compares to Net Energy Sweet forward strip at Dailyoilbulletin of $91.41US or $102.92 CDN.

AECO Gas @$3.68/MMF
               Compares to AECO $4.50 at Dailyoilbulletin

So the company cash flow is potentially running at ($102.92-$93.50)/$5*$4.2 million plus ($4.5-3.68)/$.50*$1.1 million....totals $9.7million above $77 million guided assuming production as planned and current commodity prices/spreads/exchange remains the same.

If things do stay the same we will start to see updates on pricing books and guidance expectations and perhaps some additional drilling.

Terr
 

[terroir]

CORRECTION: Cash Flow Sensitivity Slide 6 of the December presentation outlines cash flow sensitivities for 2014 guidance, with recent moves in CDN$, reduced spread against WTI, level of WTI, and nat gas prices, it is obvious that the company is facing a nice start to the year's cash flow: Cash Flow Sensitivities:  Edmonton Light – US $5.00/bbl...........$4.2 million 

[Nawaralsaadi]

Thanks for doing the calculation Terr. Based on your cash flow estimate the company is currently trading at an EV/DACF ratio of 3.7, while their peers trade for an average of 7.7 (RBC January 6th). At that average EV/DACF ratio, LNV would be trading at $12.2.  For the stock to reach my valuation target of $7 to $8 it merely needs to trade at 5 EV/DACF, which is far from a stretch when we

[terroir]

I hope, with the focus of dedicated management, the company can produce some solid production numbers. As you have past noted, their past misses have also weighed on the stock. The company maintains that the AAV situation is out of their control, fair enough, but solid results will offset that cloud pretty easily. I am somewhat concerned about Q4. Its pretty obvious that the over spend on 2013

[Nawaralsaadi]

I am willing to give them until March 2015 to prove that they can execute, should they fail to sustainably grow production and deliver on their business plan, I would consider taking additional steps to protect shareholders from a deterioration in shareholder value. I have lead similar campaigns in the past and have been fairly successful in forcing board/management teams to change course

[roscoe74]

It all hinges on the sale of AAV's Glacier asset and the management team hopping over to LNV. Bids are closed and the selection process must be well advanced unless the bids were all too low. CNRL has removed its sale of Montney assets due to lack of interest and the consensus in Calgary is that while there are lots of tire kickers haunting the sector, no one is showing any money. Many gas