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Obsidian Energy Ltd T.OBE

Alternate Symbol(s):  OBE

Obsidian Energy Ltd. is a Canada-based exploration and production company. The Company operates in one segment, to explore for, develop and hold interests in oil and natural gas properties and related production infrastructure in the Western Canada Sedimentary Basin directly and through investments in securities of subsidiaries holding such interests. It has a portfolio of assets producing around 35,700 barrels of oil equivalent (boe) per day. Its operating areas include Cardium, Peace River and Viking areas of Alberta. Its Cardium asset is a fully delineated and de-risked asset. It is focused on manufacturing repeatable low-decline and high-netback light-oil wells across its Cardium land base. The Viking is a light oil, horizontal development play located in central Alberta. Its operations are focused on the Esther area. Peace River is a stable, cold-flow, base production asset. It operates on a contiguous and an acreage within the heart of the Peace River Oilsands region.


TSX:OBE - Post by User

Comment by Hendrick3on Jul 29, 2022 8:14am
234 Views
Post# 34859439

RE:RE:RE:Share price in perspective.

RE:RE:RE:Share price in perspective.

John, I agree that this may be the cheapest well performing company I have ever seen. One factor I think contributes to this is an irrational fear of the ARO obligation they hold. In times of $30 oil price and $$500 million debt and undiscounted ARO of $500 million, it wasn't worth much. The reason of course is that in a bankruptcy the ARO would be provided for first in a liquidation as per the Clearwater ruling. 

It seems investors still haven't recovered from the near miss of a couple of years ago. They still harp about this monstrous obligation as if it comes due any day now. Outside of a financial crisis, the NPV of this is $50 million. These wells are mostly operating wells and at these prices many that were suspended are being reinitiated. 

Countless exchanges I have had with investors though suggests this obligation stands in their way. Irrational but it is causing many to lose out on a great investment. 

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