ARC Resources Ltd T.ARX

ARC Q3 2023 vs Q3 2021

[PabloLafortune]

I decided to analyse ARC's Q3 2023 results vs Q3 2021. I didn't look at commodity prices because that is outside of the company's control pretty much. Here's what I found:

#1 production is up from 353,657 to 360,177 or 2% in 2 years. Kakwa increased from 186K to 199K, at the expense of Greater Dawson. Nonetheless, oil and condensate % declined a little which is consistent with most plays of this type: if production is not increased, the oil and condensate % will decrease. Same thing happening at Pioneer. Something to keep an eye on.

#2 operating expenses increased from 116.6M to 163.6M. Unexplained.

#3 G&A increased from 28.1M to 33.4M. shared based compensation increased from 12.4M to 34.3M. Interest decreased from 59.2M to 27.1M. A little decrease overall.

#4 Capex increased from 268.4M to 401.4M. The 2023 Attachie capex budget is $240M - the company has not disclosed how much they have actually spent YTD or in Q3 for that matter on Attachie. They have been spending ~$11 capex to maintain production at the current level.

#5 $160M taxes in 2023 YTD vs $47M in 2021. Becoming a substantial expense.

#6 2024 capex budget:

They are letting Kakwa slide to 175,000 boepd, Sunrise otoho is projected to increase to 59,000 (from 51,000) boepd. It will be quite a feat to control non Attachie capex to $1B or so while essentially maintaining oil and condensate bpd.  There won't be any contribution from Attachie in 2024 even though they are spending $600MM there. 

Overall ok not that great. Lots of question marks.  Glad I did this.

Full disclosure: I own 1,000 shares of ARX and won't sell as I'm in a tax gain position but won't add either.

[MyHoneyPot]

More gas, less condensate a formula for failure.  Squanders share holder capital at every turn with no plan to pay the shareholders.  We look at the price of gas today Close Last Trade Day     Spectra - Station 2 $1.69 CAD/GJ AECO/NGX Spot Price - Settlement $2.14 CAD/GJ

[Quintessential1]

"Overall ok not that great. Lots of question marks"  =  holding "value is going down fast"  =  buying holding + buying = clowns GLTA ARX BULLS

[MyHoneyPot]

The tax situation is a issue that could of been fixed if you had an experienced CFO and an opportunistic management team that knew how to grow a company. Rather than rookie CEO's and CFO. Many acquisition are done to avoid paying these kind of crazy taxes. Terry (CEO) thinks ARX with it postage stamp plays already has the best assets in the entire industry, and has squandered billions of

[Quintessential1]

Glad you brought up the tax thing richard I. Do you know how you are making more money? You pay more taxes. richard II doesn't want to sell ARX because he is in a tax gain situation.  Transation:  he made money. I pay taxes on ARX every year because ARX makes money.  Did you richards pay any taxes on KEL? I am guessing no.  Translation: no money made on KEL (you don

[MyHoneyPot]

Kelt in Q1, 2024 will have increased it production 40% from it Q3 production.  You don't have to worry about squandering shareholder capital, they invest it all with major growth in production and reserves every year.  In fact at the end of Q4, 2024 their production will be double that of Q3, 2023.  So they will have more growth in one year than ARX has had in the last 3

[Quintessential1]

One month charts: KEL -22% ARX -9% The market knows where the real value is. Increasing production during low commodity price cycles not really the best strategy. Increasing market prices of your existing production while developing your reserves is what the smart money does. GLTA ARX BULLS  

[MyHoneyPot]

Investing in KELT that had a NAV at the end of 2022 of $17.87, i think it is trading at a discount to NAV. Wembley/Pipeston a play that is more than 63% liquids, 120 acres and  with about 24,000 acres of charlie lake is currently ramping up waiting for plant. 140 acres in a single footprint and real alberta montney resouce play. I discount BC plays because of the huge geopolitical risk. 

[Quintessential1]

Hey richard I,    richard II said it would be good if KEL could work towards 40% liqiuds One of you richards has your numbers backwards.  richard I discounts BC plays because he thinks its geopolitical risk is higher in BC than in AB. LOL They are both in Canada right?  BC isn't a landlocked province right? I was trying to figure out why richard I is here and not

[Trapped]

Lol Quint, I just found these dualling Richards on the KEL board... Is it possibel for two experienced investors to sound any more desperate?  Hopefully these ladies will do us all a favor and stay in their own lanes as you suggested. I've become so comfortable with these routine pullbacks that I hardly even notice them anymore... Rinse and repeat. Mind you, it helps having an average

[Quintessential1]

Well I would say we have a lot less to be worried about over here with well marketed and hedged production.  I noticed that richard I made a point of saying that: " Methane emission reductions to a new 75% target, will be a lot of work in Canada" Well richard not for ARX who's "incompetant management",  already electrified their plants and will bring on

[PabloLafortune]

The big story is that Kakwa condensate % is taking a big hit in 2023 - from 39% in Q3 2022 to 33% in Q3 2023 despite spending $1.1B there in 2023.  $1.1B could not maintain the 69.845 condensate production of Q3 2022 as it fell to 66,846 in Q3 2023. Condensate wise, that is some horrendous capital efficiency.  This is also why the Kakwa capex is being cut by half - they're strictly

[GunnerG]

The tax situation and low sp was exactly why mgmt took out VII.  You remember that opportunity don't you?  You are bitter to thiis day about it and the only reason to return and make your silly comments. Shoo fly shoo