Connacher Oil & Gas Ltd CLLZF

RE: RE: RE: RE: RE: RE: RE: Debt load

[rehsifylf]

I encourage anyone that is interested in learning about how SAGD reservoirs work to read up on it outside of this forum.  I won't debate 8balz on a public forum, but will suggest that he is not familiar with SAGD.  SAGD reservoirs behave nothing like conventional wells.

 

CLL has discussed production at POD1 in their quarterly results.  They have lowered reservoir pressure - which is common as well as prudent.  The ESPs are in place and each well pair will produce steadily for many years.  Changes in AVERAGE production will be associated with surface facility work such as turnarounds or OTSG maintenance.

 

With SAGD the more steam you put into the reservoir, the more emulsion and ultimately bitumen you get out.  Driving higher steam rates is not the best way to exploit a reservoir long term, and in CLLs case, they are operating at optimum reservoir pressure and stable production rates.  They have identified $37M for sustaining capital next year, which is quite low, and probably involves mainly maintenance of surface facilities and replacement of ESPs.  ESPs do not have a long life in this environment.