GREY:LSTMF - Post by User
Post by
jerrybeon Mar 04, 2014 6:31pm
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Post# 22280268
As expected
As expected
Not quite sure what market participants were expecting. This report is pretty much what I expected. Nothing special to report. Production in-line. Slight disappointment in the reserves but I would say, slight positive surprise on the asset sale front with good metrics for the disposition. More coming soon. They are finally coming out and talking about their relatively big position at Slave Point. Very secretive up to this point. It will be interesting to see what comes out of there. It seems people are "done" with Cardium and Bakken...so any new excitement might come from further north. I think the turnaround/change in attitude will take time to convince the market. They need a full 2014 of executing on their strategy before the market gives any credence to this management team. So short of a management change, I think it will take some time. The debt reduction will go slowly at $100M a quarter and barely being FCF neutral. But at least it is going in the right direction. In time, I think the value will be recognized. That's why the last thing I want to do is to sell now. One important element to keep in mind: The decline rates are changing drastically. Basically, notwithstanding asset dispositions, they can now maintain the same production with a much lower capex. The production treadmill is really slowing down. Maintenance capex for next year will probably go down in the $400M. At that point, Lightstream might actually live up to its name...