TSX:HSE.PR.B - Post by User
Comment by
mrbbon Nov 01, 2018 12:52pm
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Post# 28908850
RE:RE:MEG's Q3 Performance
RE:RE:MEG's Q3 PerformanceEigen337 wrote: From my MEG BB post:
^^^^^^^^^^ October 25, 2018 - 12:46 PM 78 Reads
Post# 28872145
MEG Shipped A Lot Of AWB To The US Gulf Coast In Q3/2018...
AWB shipped to US Gulf Coast (bbls/d);
Q1/2018 - Not released
Q2/2018 - 32,000
From page 12 of the October 2018 PowerPoint Presentation:
"At present, MEG’s marketing assets are enabling the
delivery of an effective apportionment 2018 YTD of less than
15% vs. YTD Enbridge mainline apportionment of 45%"
Calculation:
Days: Q1 + Q2 + Q3 = 90 + 91 + 92 = 273
(1 - 0.15) * 50000 = 42500
Assume daily average for 273 days is the SAME for 290 days.
Total AWB barrels to US Gulf Coast = 273 * 42500 = 11602500
Total volume transfered from Q2 to Q1 and Q3 to balanced 42,500 bbls/d for the 270 day period:
91 * (42500 - 32000) = 955500
If we ASSUME that HALF of those barrels SHIFTED were DIVIDED EQUALLY ( This is NOT the case since Q3 BOP production is PROBABLY 7K to 10K bbls/d HIGHER in Q3 versus Q1.), we get:
(955500/2) / 92 ~= 5193
Therefore, we can APPROXIMATE that 47,693 (42500 + 5193) bbls/d of AWB were shipped to the US Gulf Coast in Q3/2018.
Plus, MEG got WTI minus USD 6.75 per barrel for their heavy oil blend.
This should make a big CONTRIBUTION to their gross margins in Q3/2018.
So with this information, their strong BOP production of ~ 100K bbls/d and their hedged NET positions of AWB @ ~ USD 38 per barrel for the better part of their remaining production; I PREDICT that MEG will show STRONG Q3 results.
This is my opinion only.
Eigen337
assuming your math is right for Q3 ( I didn't read your math). Hedges don't last forever. More reliant of train transportation which add cost per barrel Oil price uncertain in 2019 Meg's worth for Husky is beyond mid 2019 (assuming the deal close). How spectacular Q3 result or even Q4 result would be is non material to husky