GREY:CNKEF - Post by User
Comment by
bouquetson Dec 30, 2017 7:17am
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Post# 27250532
RE:CKE's hedging opportunity for 2018 with AECO at C$2.80
RE:CKE's hedging opportunity for 2018 with AECO at C$2.80I hope you're right, Stockfy, about locking-in a good hedge. One thing that I've never been able to find a figure for is what the Alliance pipeline costs are to get gas from NE BC to Chicago Citygate. Do you know?
stockfy wrote: AECO made very good gains this week and closed at CAD$2.80 on Friday, see below:
https://www.naturalgasintel.com/data/data_products/daily?region_id=canada&location_id=CDNNOVA
The frigid weather will continue in January with some bullish inventory draws on the horizon, so CKE has the opportunity to hedge its 2018 Canadian natural gas production at very good AECO prices. CKE uses AECO as benchmark to hedge its nat gas production, see its existing 2017 hedges.
Station 2 pricing has also recovered as expected reaching CAD$1.15 and will continue its recovery in Q1 2018 because the High Pine pipeline project is completed next week. This recovery in Station 2 pricing coupled with CKE's hedges at AECO prices above CAD$2.50 help CKE receive good average prices for its Canadian natural gas proiduction in 2018.
In 2018, the remaining natural gas production (~30%) is exported and sold through Alliance at premium pricing at Chicago Citygate in USD.
Lastly, the Condensate production from the Condensate-rich Montney wells will be sold above CAD$75 per barrel. Edmonton Condensate exceeded CAD$75 last week.