GREY:CNKEF - Post by User
Post by
stockfyon Aug 11, 2017 3:14am
165 Views
Post# 26569646
Q2 2017: Expansion, Guidance & the two funds with 51%+
Q2 2017: Expansion, Guidance & the two funds with 51%+Some retail investors due to ignorance and stupidity sell their few shares at $0.30 although CKE is a debt free and cash rich Montney play that currently trades at just $900 per Montney acre while the indebted Montney peers trade above $2,200 per Montney acre.
These retail investors are destined to lose in the stock market and also they can't determine the game and the buyout offer for CKE because two funds own 51%+ in CKE, these funds are HMQ and Bison, see previous posts and latest Sedar filings.
Q2 is out and CKE moves according to the plan and the guidance for 100% YoY production growth.
Excellent decline rate for their Montney wells to-date! Actually, their IP-90 rises or remains flat relative to IP-30 for the majority of them ! This applies both to the 3 recently drilled wells and to the 6 previously drilled wells. See the table with all the drilling results from their Montney wells. This is really rare, most Montney producers see their wells decline after 90 days compared to the 30 days!
Production rose slightly compared to Q1 although no wells were drilled in Q2. And in Q3, following the completion of the McMahon Plant turnaround, CKE averaged approximately 4,850 boepd from July 18 - 24, 2017 although NO NEW WELLS WERE ADDED, but these volumes have since been impacted by further McMahon Plant restrictions.
Despite low prices for oil and natural gas in Q2 2017, operating netback increased 526% to $9.08/boe compared to the same quarter of 2016. So it remained above $9 per boe and was above $10 per boe for the six months. Raymond James had forecasted $6 per boe!
Secured the credit facility of $8 million.
This reserves-based credit facility will go UP during the next determination, because the 4 new wells that are currently being completed will add significant Proved and Probable reserves. I expect the new credit facility to be at least $15 million by early 2018.
On a per boe basis, for fourth quarter of 2017, CKE continued to affirm that the net production expense is expected to approximate $8.00/boe. This is one of the lowest cost per boe in the Montney space!
Production guidance at 6,300 boepd for December 2017 remains in place.
Birley/Umbach facility expansion to 50 mmcf/d from 25 mmcf/d today, (this is a 100% expansion required for additional production growth in 2018) is ongoing with an expected construction commencement date of September 1, 2017 and an on-stream date of December 1, 2017.