RE:RE:RE:RE:RE:Condensate remains at a premium to WTIYou are correct, the prices are not baked in to earnings because PIPE has to produce the condensate first and actually sell it. I should have just stuck with my statement that regardless of condensate prices the price PIPE receives for 5600 bbl/d is hedged. That hedging is factored into the 2020 capital plan (key word there is plan). There is no gain or loss based on fluctuation in condensate prices for those 5600 bbl. Same goes for the gas prices.
I think even Don would agree that getting those hedged prices was a good move as it provides stability and confidence in achieving the 33K boed production capability on the plan provided in the last update.
How much unhedged production remains? And how much free cash is potentially available for accelerating the plan to get to 33K boe/d(or reduce debt) is the crux of the debate.
Tuco110 wrote: Actually Skip, the numbers aren't already baked in, they are guaranteed. When Don is talking extra income, it is over the model prices of $70CAD condensate and $1.70CAD AECO gas in the presentation, that is what is baked in. True prices could go down but they could also go up, I'm skeptical that WTI will hit $70US any time soon but I'm bullish on gas after 2020 because of all the LNG plants and the new gas cogen plants being built in the US as well as all the coal fired plants switching over to gas.