ARX management has failed to deliver a compelling message to shareholders of why they should invest in ARC resources. The message has failed because they lack the ability to present a compelling business opportunity, investors want to invest in.

How are the capital investment going to reflect improved shareholder returns in 2022?
  • Sunrise expansion    No production impact for 2022/ Costal LNG first nations issues
  • Attachie                     An unsanctioned project riddled with Treaty 8 issues, money pit
  • ESG Reduction          Zero impact on production

Non of these projects will add to the production profile of ARX in 2022 and there in no certainity they will even happen in 2022.

 
Attachie a non-investable Project

Attachie is a project that is not sanctioned, it is immersed in treaty8 issue, and it will be impossible to know the costs or the operating constraints on the project. What other 10-billion-dollar company would put a project forward like this as their best investment opportunity as a thesis of why you should invest in ARC in the future. They cannot even get approval to start the project, and they have already committed to the project without an agreement in place from the first nation. What if the treaty 8 people don’t give it to you, or you can’t economically work within their constraints?

Kakwa Message to shareholders - Does Management understand this?
  • Kakwa has 7/10 best liquids wells in the Montney
  • Kakwa has 3/10 of the very best gas wells in all the Montney
  • Kakwa has 420 net sections of running room
  • Kakwa has 1010 MMcf of processing capacity with 40% utilization
  • Kakwa is more than 50% liquids
  • 89% of Arx liquids reserves are in Kakwa
  • Kakwa is all half cycle economics
  • Kakwa generates approximately 70% of Arx CF
  • Kakwa have the best per boe CF in the entire Montney

So, investors who want to put their money in a company where everything is two years down the road.
  • 2 years to get rid of dismal hedging
  • 2 years to build sunrise plant
  • Attachie with no timetable
  • 1 billion in FCF directed to share buyback
  • Miss the current commodity upcycle by not investing in Kakwa
  • No short-term meaningful production increases that are 1/2 cycle.
  • Under Capitalization of Kakwa the best play in the entire Montney
IMHO