Fresh Tracks Therapeutics Inc V.BBI

RE:RE:And don't forget

[RuudinFrance]

skiptoggle wrote: Technically that is true but as stated by management they will continue to hedge so we can't rule out a strategy of trying to hedge ~50% of production as it ramps up.  Obviously any new hedge contracts would realize the higher (or lower) commodity prices at that time. 

Higher Condensate and Nat Gas prices are always good for PIPE, the energy industry in general and Alberta.  I will cheer prices as they go up as it does add to the value of PIPE: we can all agree to that. 

FYI My level of knowledge on impairment is limited to remaining below .05% BAC.

cheers everyone! 

Don2018 wrote: as we continue to ramp up production next year, these hedges become a smaller and smaller percentage of overall volumes.

Skip,

The intention (PIPE) with hedging is to ensure that development may progress without any possible financial uncertainties.
How much they need to hedge is up their financial wizzards.
(they need a certain amount that makes the budget run. If that is ensured with 40%, or 50%, or 80%, they'll hedge that much.
The rest may run at dayrates. Looking into the future is difficult for most analysts and for PIPE's "wizzard" it will not be any different.)

As vehicles they use:

Collars:
In finance, a collar is an option strategy that limits the range of possible positive or negative returns on an underlying to a specific range. A collar strategy is used as one of the ways to hedge against possible losses and it represents long put options financed with short call options.

fixed price swaps:
A swap is an agreement whereby a floating (or market) price is exchanged for a fixed price or a fixed price is exchanged for a floating price, over a specified period(s) of time. The instrument is referred to as a swap because the transaction involves buyers and sellers “swapping” cash flows with one another.

product differential hedges:
Product Differential, in the natural gas market, is the difference in gas futures price at one delivery point and gas futures price at another location. In the U.S., Henry Hub is considered as the main trading hub for natural gas. So basis differential is the difference in the Henry Hub spot price and the natural gas spot price in a specified location.

I hope this helps :-)

Have fun

P.S.: There is more explained in the last MD&A, just look it up (page 9).