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ARC Resources Ltd T.ARX

Alternate Symbol(s):  AETUF

ARC Resources Ltd. is a Canadian energy company. It is focused on the exploration, development, and production of unconventional natural gas, condensate, natural gas liquids (NGLs), and crude oil in western Canada. Its operations are focused in the Montney region in Alberta and northeast British Columbia. Its operations in Alberta are located near Grande Prairie and the region includes Kakwa and Ante Creek. Kakwa is a condensate-rich and high-deliverability natural gas play with top-tier development opportunities. Its operations in northeast British Columbia are located near Dawson Creek and the region includes Greater Dawson, Sunrise, Attachie, and Septimus and Sundown. The Greater Dawson operating area includes Dawson Phases I, II, III and IV and Parkland. The Attachie is a condensate-rich, natural gas play primed for large-scale development. Sunrise is a dry natural gas play with a low-cost structure, well deliverability and direct connectivity to liquefied natural gas Canada.


TSX:ARX - Post by User

Comment by uncutgemson Dec 12, 2021 1:04pm
159 Views
Post# 34223091

RE:RE:RE:What I'd Do to Sell the Virtues of Kakwa

RE:RE:RE:What I'd Do to Sell the Virtues of Kakwashaleguy. about NE BC...take a look at page 25 of the current presentation. it's revealing. 
They plan to spend $600m on the project (I believe the bulk of it is supposed to be in 2023-2024) and don't expect any free cash flow from the project until YEAR 4 of the plan. They will be creating a huge free cash flow Defecit from this project for two full years. Since they don't want to borrow and add more debt, the capital has to come from the free cash flow generated from the other ARX properties, in particular Kakwa. But they have also commited to large dividends.

I can see the board of directors at Arx discussing how on earth they intend to fill that cash flow hole without borrowing and one idea probably was to USE ARX SHARES to buy the free cash flow (Kakwa).  This is why they are working so hard on turning Kakwa more intot a cash flow machine rather than a growth machine, which would consume more capital. 7g had a for sale sign on it and Arx took the bait.

btw, why do they only have ONE SLIDE dedicated to Kakwa in their deck when it represents MORE THAN HALF their cash flow? They have one slide for kakwa and one for Ante Creek? That's just a poor representation of reality.


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