Athabasca Oil Corp T.ATH

Alternate Symbol(s): ATHOF

Energy Oil & Gas E&P

Athabasca Oil Corporation (AOC) is a Canadian energy company with a focused strategy on the development of thermal and light oil assets. AOC’s segments include Light Oil and Thermal Oil. The Thermal Oil segment includes the Company’s assets, liabilities and operating results for the exploration, development and production of bitumen from sand and carbonate rock formations located in the Athabasca region of Northern Alberta. It also consists of two operating oil sands steam assisted gravity drainage projects and a resource base of exploration areas in the Athabasca region of northeastern Alberta. The Light Oil segment includes its assets, liabilities and operating results for the exploration, development and production of light crude oil and medium crude oil, tight oil and conventional natural gas. Its Light Oil segment consists exclusively of the Duvernay in the Greater Kaybob area with about 155,000 gross acres across Kaybob West, Kaybob North, Kaybob East and Two Creeks.

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Athabasca Oil Corp > I want to hear plans with their Great Gobs of Cash

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Comment by ManitobaCanuckon Oct 21, 2021 6:25pm

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RE:RE:RE:RE:I want to hear plans with their Great Gobs of Cash

Your strategy might be good if you expect multi year oil bull market . If Oil crashes again then we are stuck .Remember banks are difficult to deal with when u have long debt.

MigraineCall wrote: If you came this far, and still believe that ATH has a bigger upside than 9.75% per year, it would be most efficient to spend the very first dollars earned to buy back as many shares as soon as possible at a lower level, before starting to pay down the debt. Once debt is paid down, then pay out dividends. The share buybacks and debt repayment should not be too long of a wait with the current FCF.

Once you start paying down debt and dividends, the share price increases, and buying back shares just got a lot more expensive than before, leaving less funds to pay the rest of the debt or pay dividends.

This way, it will be in a much more valuable position in a few years from now.

ManitobaCanuck wrote: I agree they should keep debt at 100mill or so and tell the bank to GFY . Plan a NCIB for 5% every year for 3 years to take out the 15% shares dilued by warrants. Approx 30mill needed for NCIB every year . ITs cheaper to buyback the debt which is being paid at 9.75%

Mindset wrote: It would be a wonderful surprise if they planned to buyback shares next year, but my gut tells me their focus will be on paying down debt targeting 0.5xD/CF. Whatever FCF leftover will be carryfoward into 2023, or used to cover increased production targets or costs.

It would be great to get an update on Pad L6+L7, and maybe even L8, as well as production guidance overall.

I can also see them hedging 25-50% at current prices. Hopefully closer to 25%.

Time will tell.

Also Q3 comes out the following week.