Connacher Oil & Gas Ltd CLLZF

CLL - January Q4 production update - positive news?

[rehsifylf]

The final gift that Richard Gave CLL was to let the banks contiue to molest CLL at the 8.75% rate.  Without that - the company would surely make it.  With it - its a crapshoot.

I will say - 2013 was a very successful year for CLL operationally.  They hit on everything they were doing and the employees and management should be congratulated (no - I don't work for them LOL).  I expect that Q4 production increases, combined with far less capital spend will make up for the large drop in revenue from lower bitumen prices.  Hopefully they wont use much cash.

The crapshoot variable - Jan 2014 WTI prices.  If prices can climb above $100 when they announce production numbers for Q4 (Jan 15th?) and the December volumes include some production from 104 - I expect the market will start to believe these guys can make it.  At least through 2014.  That might actually attract some JV money or a PP at .25 cents or so.

But- obviously - the best invesment an Oilsands company is in one of the major banks.  Rough calculations indicate that the banks have recovered around $1B on their loans to CLL of $870 M and still have $870M owing - with about $80M per year in interest still coming in.  Worst case they foreclose on an operation that, without interest payments, is tossing out between $50--60M per year of cash flow (after capital expenses).