RE: RE: RE: RE: RE: RE: RE: dividend ??No - I think they included everything that IS POSSIBLE, not necessarily PROBABLE. They have no intentions of a dividend cut. And, what I meant by $60 comment was a more broad statement that weakening in oil prices could cause management to reduce dividend, but it would have to be a sufficient drop - sub $70.
1) If you listened to conference call (which you obviously didn't) they estimate $500 million to sustain production. I suspect $200-300 million for facilities and growth in Cardium. Thus, wouldn't be surprised to see capital program come in $100 million less than lest year, but this also depends on what time of increase in credit they get. So, yes, they could cut CAPEX and still have growth - you are wrong.
2) Issuing equity is an impossibility? Well, if it is late 2012, and the price is $15 - I could see PBN issuing 10 million shares before I see them cutting the dividend. Impossible? Maybe unlikely. Wrong again.
3) Clearly, your response here is generic cause you have no clue how this works. Firstly, to renegotiate terms, particularly the "put" date, the conversion price would be lowered, and the interest rate would increase. This is a possibility.
4) Asset sale is your first choice? Like what? The natural gas assets in NE BC - you would like PBN to sell at probably the darkest days in the natural gas sector? Or maybe you want them to sell their potential third resource play before they even have a chance to demonstrate success on a few wells and muster any further value....idiocy. Asset sale should be far down on the list.
5) Divy cut. Not significant enough cash flow wise to be a key option - a WHOLE year's dividends covers 1/4 of the convertible debt...and you potentially hurt your price, which just magnifies the dilution risk on a put. More idiocy.
6) Other many, many options - other financing terms. You know what that means. Well, if they get an increase in their credit line of $400 million, that funds half of 2012 CAPEX. If they have $1 billion in cash flow, less dividends and internally funded CAPEX, voila, you have $450 million of what you need. Further, you can manage working capital up to $50-100 million until the 2013 line increase. And by that time, the Cardium will be generating FREE cash flow, and PBN is laughing.