Cardinal Energy Ltd (Alberta) T.CJ

2024 budget and SAGD impact

[mickeymouse]

Looking at the 2024 budget and their new Redford SAGD project from the presentation:

2024 FFO = 290
Conventional Capex = 116
Thermal Project Capex = 68
ARO = 20
Dividend = 116
 
Debt will increase slightly next year - about 30 million.

 Spend in 2025 on this project  is projected to be 88 million but incremental cash flow of 28 million is projected for 2025 so net incremental capex in that year would be 60 million and the increase in net debt will be about 22 million.

 So debt should peak at about 100 million in late 2025 but starting in 2026 there will be postive cash flow from this project - estimate for 2026 is about 105 million.  So in summary a small increase in debt for the next two years followed by higher cash flow starting in 2026 if everything goes as planned and current oil prices/differential/FX rates etc. stay relatively static - a lot of ifs but the payout could be significant going forward.

 

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[Pandora]

And what does that say for 2024?

[RockLobster1]

I am looking to start a position... Does anyone see any impact short term from this report? Are there other companies similar to this one I should be considering?  Looking for somewhat safe income stocks with some growth potential. Are the dividends in Canada taxed as return of capital or Canadian dividends with the credit? Thanks!

[JohnnyDoe]

Short term impact? Yes. The dividend is sustainable short term..Q3 was good, Q4 will be better. Debt ratio very low.  Similar companies. In the cdn oil patch? Not really no. Probably the safest high yield oil stock out there  Dividends with the credit

[Quintessential1]

While CIBC Capital Markets agrees with your budgetary calculations: "  2024 budget adds spending to construct SAGD facility. Conventional spending of $116MM is higher than our estimate at $100MM and Street at $111MM, while SAGD facility construction is expected to add $68.5MM in 2024. Production of 22.3 MBoe/d is in line with our estimate of 22.3 MBoe/d and ahead of Street at 21.2 MBoe

[JayBanks]

  11M/Q is quite doable considering they just knocked off 14M and that was before they bought more production. The said they expect to payoff the new purchase by the end of Q4 with FCF, with the little dip in price I don't know that we will see that projection hit. I think some of the debt numbers and projections don't account for the new purchase because most of this stuff is

[mickeymouse]

The CIBC flash research debt assumptions are interesting - they are suggesting a net debt of 7 million in 2024 - not sure how they get to that number unless they are taking into account the "50 million of capital items in the budget that can be eliminated or deferred to assist the project financing in the event of a significant decline in oil pricing". In any event even if they have a