as I pointed out MEG has been very volatile and perhaps a little more so than more established producers like SU and CVE, but that can also be explained by the fact that they are NOT  integrated companies as well.

what does volatility mean?

to me it means that investors are unsure about MEG's future and positive news sways them to buy more and negative news sways them to sell more.

as MEG currently sits with 40 WTI, it's close to break even if not at breakeven depending on the CND and operating costs but they still have high long term debt.

they had excess cash going into 2016 to the tune of 400 million and that will act as a buffer but only for so long.  Sure they can sell assets to get more cash but again at 40 WTI they are not making free cashflow.

yes they will survive unless oil falls back into the 30's and then it's all hands on deck and a sale of their pipeline is gravely needed to shore up the balance sheet.

I'm not being negative on MEG, but I am tempering my long term view to neutral for now.

in my book and I have a very conservative way of looking at things MEG is worth and without the pipeline sale or company sale or any JV transaction.

3-4 at 30 WTI
5-6 at 40 WTI
7-8 at  50 WTI
9-10 at 60 WTI

these targets will go up or down depending on any sale or transaction metrics of course but right now their debt is preventing a company sale at a good price i.e 18-20 range and any offer coming in today will be in the 8-10 range where the buyers are discounting the assets based on short term low prices and being opportunisitic as SU was with COS.

one things that is happenning lately is that company's are buying back their debt at a discount and in some case quite significant discounts and maybe MEG is also planning on on or more of these transaction when they complete the access pipeline sale.

this debt buy back can be very meaningful in lowering total debt, reducing interest costs and cleaning up the balance sheets and getting lots of breathing roo while the price of oil slowly recovers.

interesting times for sure, and MEG has high quality assets, but right now q1-q2 will be messy and hopefully q3-q4 will be much better with higher average oil prices as well.

we need to see US oil production falling more and more with every passing week and then the oil price will get into equilibrium.

GLTA and DYODD