RE:RE:uograduograd wrote:
Can you be more specific? Am I lying about management knowing a heck of a lot more about Bruderheim being late and over budget and not telling us?
Am I lying that the guys who bought the stock at $8.45 in June are piffed?
Am I lying about how bad this quarter is going to be? Have you not been reading what others in the financial post etc have been saying, not withstanding the brutal cold weather that will also crush earnings?
Am i lying that i think there is no question the dividend will be cut. Do the math. add in all the shares from the last placement and walk through what our total payment ratio would be at this number? It would be well in excess of 120% maybe 150%.
Am I lying that they are going to shut Bruderheim down for at least 90 days to try and finally get the fricken thing finished. Where is reveneue to pay next quarter's dividend going to come from if your major asset is completely shut down?
Am I lying the President got canned with no replacement ready to go?
I didn't cause the stock to drop from $9.00 to $4.60 but I have certainly noted the reasons why.
uograd; You seem to be claiming that Canexus knew that there were problems with the NATO project in June 2013 when the $8.45 bought deal was completed.
Do you have any evidence?
The Q3 financials released on Nov 07 contained this statement;
“The initial phase of the pipeline connected unit train expansion (capacity of seven unit trains per week) at the Corporation's North American Terminal Operations ("NATO") at Bruderheim, Alberta is expected to be mechanically complete in early December, with the first unit train shipment from the unit train facility about mid-month. The next staged expansion to further increase loading capacity of the Bruderheim Terminal is expected to be fully operational by mid-2014, to coincide with the completion of the second pipeline connection to the Cold Lake pipeline system. The total estimated cost of the pipeline connected unit train facility, when complete in mid-2014, is unchanged at $225 million. Operating Cash Flow from unit train operations, assuming 10 to 11 unit trains per week, could exceed $50 million annually and Canexus expects to be at this level of activity for the fourth quarter of 2014. With the delay in completion and commissioning of the unit train facility from the third quarter to late in the fourth quarter, and a winter start-up, we believe it prudent to be conservative in estimating the Operating Cash Flow to be generated from the NATO business unit in 2014, but expect solid performance commencing in Q4/14 and beyond.”
The next update was on Dec. 17;
“
CALGARY, ALBERTA--(Marketwired - Dec. 17, 2013) - Canexus Corporation (TSX:CUS) ("Canexus" or the "Corporation") today announced that it has commenced loading pipeline connected Access Western Blend (AWB) product into railcars in the initial phase of its pipeline connected unit train expansion at the Corporation's North American Terminal Operations at Bruderheim.
"This is a significant milestone in the ongoing development of our terminal operations at Bruderheim. Start-up activities are well underway and will continue through December, with the expectation of shipping the equivalent of four unit trains before year-end," said Gary Kubera, President and CEO. "The next staged expansion to further increase loading capacity is anticipated to be fully operational by mid-2014, to coincide with the completion of the second pipeline connection to the Cold Lake pipeline system," he added.”
On Jan. 14 2014 the BAD NEWS was announced.
“
CALGARY, ALBERTA--(Marketwired - Jan. 14, 2014) - Canexus Corporation (TSX:CUS) ("Canexus" or the "Corporation") today announced that commissioning and ramp-up activities are continuing in the initial phase of its pipeline connected unit train expansion at the Corporation's North American Terminal Operations at Bruderheim. In the month of February we anticipate loading 14 unit trains or about 30,000 barrels per day.
Following a thorough assessment of this phase of the project, combined with the next staged expansion to further increase loading capacity including completion of the second pipeline connection to the Cold Lake pipeline system, the total estimated cost is anticipated to increase by approximately 40% over the previous estimate of $225 million. An extensive review of progress to date and remaining outstanding scope has been conducted with key project contractors and consultants. The incremental cost is anticipated to be funded from the Corporation's committed credit facilities.
Full project completion remains as earlier forecast for mid-2014. Contract discussions for the remaining available 30 to 40% of planned activity levels of 10.5 unit trains per week are progressing as previously communicated (on long-term, take-or-pay terms) and management continues to anticipate operating at that level commencing in October 2014.
"While we are disappointed with the revised cost estimate for the completion of this project, the Corporation has established a state-of-the-art facility at Bruderheim that is well positioned to deliver consistent, long-term value to shareholders, on a site that has additional attractive future development opportunities," said Gary Kubera, President and CEO.”
I will “speculate” that in late 2013 they realised that there was a major Engineering screw-up and or when they got the bids for the labour and material for the upcoming work they realised that they had seriously underestimated the cost. Unfortunately Engineering screw-ups and cost overruns are all too common in these types of projects.
There is no doubt that the NATO project has been SERIOUSLY Mismanaged!
The BOD has taken steps to deal with the problem!
Personally before I would accuse people of “lying and deliberately withholding information” I would need something a bit more concrete than “speculation”.
You stated “they are going to shut Bruderheim down for at least 90 days to try and finally get the fricken thing finished. Where is reveneue to pay next quarter's dividend going to come from if your major asset is completely shut down?”
That is a partial truth at best; March 13 2014
“· Canexus announced the start-up of the initial phase of the pipeline connected unit train expansion at the Corporation's North American Terminal Operations ("NATO" or "Bruderheim Terminal") at Bruderheim, Alberta in mid-December. Start-up and commissioning activities, complicated by severe winter weather, have continued through to the end of February, limiting unit train shipments to date. The Corporation anticipates loading approximately 12 to 15 unit trains per month for each of the next few months and then plans to take a 60- to 90-day period of downtime, currently targeted to commence in June, to complete remaining work, which will further increase unit train loading capacity at the Bruderheim Terminal and connect it to the Cold Lake pipeline system. The efficiencies of taking an uninterrupted period should allow Canexus to meet the revised total estimated cost of this project announced on January 14, 2014. The planned downtime will not affect truck-to-rail operations at NATO. Currently, 60% to 70% of planned unit train activity is contracted for multiple years. The Corporation expects to have unit train operations fully contracted in the near term. The financial contribution of the NATO unit train facility in 2014 will depend upon the timing of ramp-up of the expanded facility as it becomes fully operational.
· The diluted bitumen and crude oil ("DBCO") truck-to-rail transload ("manifest") capacity expansion at NATO was completed in the third quarter of 2013. Canexus exited December 31
st at a transload rate of approximately 23,800 bbls/day and averaged 16,200 bbls/day in the fourth quarter. Transload volumes will be lower in Q1/14 than the 2013 exit rate, mainly due to challenging winter weather conditions. Our highest daily transload volume to date was established on February 21, 2014, at just over 27,100 bbls/day.”
You have questioned where they will get the money to complete the NATO project.
Would this be it?
“
CALGARY, ALBERTA--(Marketwired - Feb. 5, 2014) - NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. Canexus Corporation (TSX:CUS) (the "Corporation" or "Canexus") is pleased to announce that it has closed its previously announced offering of 26,800,000 common shares on a bought deal basis at a price of $5.60 per common share, for total gross proceeds of $150,080,000 (the "Offering"). The Offering was underwritten by a syndicate of underwriters, co-led by National Bank Financial Inc., CIBC, Scotia Capital Inc. and BMO Capital Markets.
The net proceeds of the Offering will be used to repay a portion of Canexus' existing indebtedness in order to position the Corporation to fund the remaining planned capital expenditures for unit train capability at Canexus' North American Terminal Operations ("NATO") at Bruderheim, Alberta, expenses incurred but not yet paid in relation to NATO and for general corporate purposes.”
** The estimated NATO cost overrun is $90m. They raised abt. $150m!
As Always; Do Your Own Due Diligence; It’s Your Money !!