RE:RE:Q4 Cash Flow EstimateOldtimer, I will provide you and those interested in COS with three scenarios along with an estimate of what could happen in 2015.
The first scenario is to remove the capital expanditures in my Q4 estimate. Appreciate that the capex in Q4 is made up of approximately $150 on major projects and $100M on maintenance. The Q4 capex on major projects is lower than average because it was higher than average in Q3. Since the capex in 2015 is $200M, the capex reduction is then only $400M. In this case the Q4 scenario would show a distibutable cash flow of between 39¢/qtr and 45¢/qtr. The differnce being that unknown quantity called "Change in Non-Cash Working Capital" (CNCWC), which I guesstimated at $30M. This number is almost impossible to figure out, but nevertheless shows up every quarter in the cash flow estimate.
I also ran a clean 2015 scenario. 9.75 Mb/qtr (slightly above guidance). SCO of $95/bbl. $200M capex. $400M maintenance. No CNCWC. It comes in around 38¢/qtr.
Uping the SCO to $100/bbl gets the distributable cash flow to 44¢/qtr.
Looking at the chart for COS, it has put in a two year multi bottom at $19.00. Looking at the action over the past month, there are indciations that it is starting to move. As I mentioned last time, I think that some analysts are beginning to see the light at the end of the tunnel for COS.
Namsoc