Pine Cliff Energy Ltd T.PNE

PNE's outlook...

[zack50]

As indicated, 2023 saw North America experience one of the warmest Januarys in recorded history. This warm weather, coupled with the ongoing Freeport LNG export facility outage in Texas and resulted in a 41% reduction in Henry Hub natural gas pricing in 01/23.

Although AECO pricing moved lower during this time, AECO Daily 5A still averaged $3.72 per Mcf in January. The AECO Daily 5A price this morning is $3.33 Mcf and the forward AECO strip price for the remainder of 2023 is $2.94 Mcf. At these projected prices, Pine Cliff is on track to generate the second highest annual adjusted funds flow in our history.

At today’s strip prices, PNE's capital and dividend program for 2023 can be fully funded from Pine Cliff’s forecasted adjusted funds flow.

[RJboxer]

I expect PNE to get bought out this year. Getting closer to LNG Canada, and consolidation makes a lot of sense across the Montney.

[Trapped]

Things I liked: They actually exited 2022 with more cash than I thought they'd have on hand. Also, Phil reiterated in his commentary that they're actively looking at tuck-ins funded completely with cash (i.e., no need to issue debt or equity). I really like what I see here.

[mjh9413]

Is LNG export a close probability for Canada on a significant scale or at all? I don't think so. PNE is nice but its hedges are not as good as in prior years for OTT success beyond March end. Possibly a static situation with flat prodn and possibility of lower average prices and hence revs, etc What size of tuck in acqn from cf alone cud occur in that scenario. I remain long as bought much