RE:RE:RE:RE:RE:RE:RE:RE:LNG pipelineThe current futures curve will definitely impact PEY for the next few quarters or perhaps a year but the futures curve is now because they enter hedging agreements now and after that it is just a formality to deliver and get paid. The only thing that matters MORE for this stock is what the futures curve will looks like tomorrow, next month, next year. Everyone knows the what the futures are doing now and it explains the total collapse of stock prices for all WCSB producers. It would have been FAR more useful to know this would happen 12 months ago. So what will the next 6-12 months look like? This will dictate whether you double your money or just go home with a tax loss. I have no problem if someone explains why they believe supply will outstrip demand for the indefinite future and AECO wont improve but I havent seen anyone explain that. Right now there is a legit possibility that North American has storage could hit 5 year lows and yet AECO is simultaneously hitting new lows. I cant explain why that is happening so I look for evidence and ideas. I would love to see the details that supports the bear case but I find the bears here just keep pointing to AECO futures. Is it necessary to point out that the futures were reasonable a year ago and yet the bottom fell out the market anyway!
Chris_toronto wrote: boarderex, I read your other message and questions to Ceremony and I'm going to answer you instead. Please read again the below first 5 lines from Ceremony. They have your answer. What else matters for Peyto, in your opinion, if the forward AECO curve is horrific? What other factors matter for a company if they can't sell their only commodity? Simple question. ceremony wrote: most pey investors understand one thing. they get a check in the mail every month. that's their level of understanding. And I am serious.
the AECO futures curve has been bad for awhile. It has been HORRIFIC for last two months. most still don't understand the ramifications.
it must be nice to own these stocks and not to have a worry in the world. :)
boarderex86 wrote: I would love to see your valuation to show what the share price will be when the futures are factored in so that the rest of us can appreciate your idea of fair price. The futures curve has been bad for a while now. It doesnt take an expert to understand that. I expect every buyer understand the situation at this point.
ceremony wrote: no this pipeline is not dead. nor is the Exxon LNG plan. Nor is the Shell LNG plan. they are not dead. they are on life support. I would say SHELL has the best chance to go forward. I give it a 33% chance. And the biggest beneficiary is likely Tourmaline, which has a very very tight relationship with SHELL.
the crappy futures curve HAS NOT been fully factored into the prices of these stocks. at the current AECO futures curve all these producers are KAPUT. BK.
the first AECO contract priced Above $2/gj is December 2020. Most business plans today are based on $2.50/mcf CAD AVERAGE prices.
Yes things could change and likely will change. something has gotta give. But if you are invested in one of these companies, and can look at AECO future's prices and not feel sick to your stomach, you are not interpreting them correctly. these prices are Horrific for producers.
boarderex86 wrote: In my view, it is meaningful that TC made a point of acknowledging the pipe project is not yet dead. It would be dead if there wasnt ongoing discussion about an LNG terminal being constructed. This is not significant for current gas prices (construction must be 5 years on a plant like this) but the value of Montney / Deep Basin reserves would be much higher if an LNG project were coming on the Horizon. I would expect PPY would probably benefit the most from an announcement like that. Ceremony - someone once said that the markets are forward looking. The crappy futures curve has now been factored in by the market. You need to look to the future and consider what future circumstances will help WCSB producers turn the corner. LNG perhaps?
ceremony wrote: all transcanada has committed to here is Futher study. this "news" was released last thursday. and producer stocks have gone straight down since thursday. if anythng this news only highlights the intractable problems Canada faces in gettting an LNG project completed. Let's say by some miracle one actually gets approval and starts up. It will be several Years before gas is actaully shipped from them. I remember first reading about the exciting possibilites of CA LNG plants almost 4 years ago. Which happened to be when nat gas stocks Peaked.