The prospects for Canadian natural gas producers Michael Harvey (RBC analyst)...
“Global natural gas fundamentals remain strong and with our outlook calling for considerable FCF to be generated amid the Canadian gas group in 2022, capital allocation remains top of mind as producers remain disciplined and return of capital programs play out. Controlled growth within a now more consolidated basin (top 5 producers control ~50% of the basin) will be key en route to mid-decade LNG Canada commissioning; currently ~59 Canadian gas rigs are operating as the fall budgeting season approaches… Average 2022 AECO prices remain strong at ~C$3.60/GJ and well above basin supply costs which we estimate at $2-2.50. This dynamic is backstopped by continued strong [natural gas-related] liquids pricing.”