RE:RE:RE:RE:RE:RE:RE:RE:Vermilion will be crushed by 2 billion debt Emmitt wrote:
So I am looking at the latest info the comapny has provided in December. The 105% is at $57 WTI.
When I look at slide 12 of the following presentation, it looks like 2020 calls for 58 WTI (i.e., neither 55 nor 60) and 62.13 for Brent.
https://www.vermilionenergy.com/files/Vermilion_Energy_-_Corporate_Presentation_-_Dec_2019_-_WEB.pdf
You are correct, Emmitt, that 55 looks like it would have a negative effect on the balance sheet (though to me it would be a slight one). Slide 12 suggests that at $55 WTI and $5CAD MMBTU, the FFO is $836 CAD$MM while at $60, it is $924 CAD$MM. Between those (58 WTI), you would get 880$MM CAD (if my interpolation is close to correct - I know it is not exact because 57.50 is the midpoint not 58 and I was being lazy).
Slide 15 of the same presentation shows an anticipated ratio of total expenditures (dividends, loan payments, capex) to fund flows from operation of less than 100% with WTI of 58.13 and Brent of 62.13.
Too many moving parts, but I think there is still room for the company to cut capex before reaching the "sustaining" as compared to a "growth" level.
Either way, I like the idea of managing for slight growth and a steady payout to shareholders, which is why I am here. Nothing polarizing about it except that some people seem to be more willing to bet against a stable to increasing oil price at this moment in time.