RE:RE:drilling for money...Terribleeng their net debt was 1156, not 1168.
Also with regards to your previous comment about shell’s nat gas assets sold for 200m, those natgas properties were sour gas. Quite an important detail... Also, what I hear, it used lots of external processing. And this was a super major fire selling its last E&P assets in Trudeau Canada. I wouldnt make any valuation benchmarks with this case, lol.
Banks are not interested in putting companies in default, especially not a fundamentally competetive producer like Peyto. I note that Peyto is currently at 2,7x debt/EBITDA and peaking here, they relaxed a covvie to 3.25 in January while not demanding the company to cancel the dividend. Being a commercial banker myself, that shows that the banks are not concerned and the company has maneauverability, otherwise they would have cancelled the dividend by now, arguably I believe the markets even expects it, lets see.
The big issue that Gee and team did not foresee this year was Propane and Butane pricing, and thats why Peyto’s share price has tanked relatively more than others. These are two important products for Peyto.
This is a cyclical business, being close to covenant limits happens in low cycles. Covenant are there to put management teams on their toes, if they dont behave, then the banks may decide to accelerate if its spiraling downwards. In this case tho, they havent even demanded to cancel dividend! This company is clearly earmarked as survivor.