Connacher Oil & Gas Ltd CLLZF

Buying Assets in the ground.

[Wellsitter]

CLL has over 600mm 2P barrels of bitumen. FD&A costs around the world vary considerably with some as low as $9/bbl and some as high as $30/bbl. Neither of these numbers represents the extreme as there are some higher and lower but if one had to pick a number for an average and be on the conservative side, $10 - $12 per bbl certainly isn't off-base.

Who would be willing to pay $10+/bbl of 2P reserves? Someone with a long-term view who is looking for security of supply and who believes that the price of oil will remain relatively stable or higher over the next 20 years.

When an acquirer comes into view who is willing to pay a reasonable price for the 2P assets of Connacher, the shorts will indeed get that religious experience that they so richly deserve because folks, even at $4 per 2P barrel the price per share of CLL would be $8.40.