RE:RE:RE:RE:RE:RE:Someday More or less agree, although I don't think any of these companies had too much debt - I think they just got caught in a hard spot with lenders that were exiting the business due to political BS. In past years debt was allowed to routinely blow out to 3X cash flow at the bottom of the cycle. What will we be at in December? .5X ?
CJ was almost in bankruptcy protection over a tiny 30 million dollar loan so its not the actual debt load that is usually the problem. They need better covenants, properly staggered maturities, more dependable lenders etc.
At 14,000 boe/d 150 million in debt is a pretty comfortable amount to carry - especially with BNE's oil cut. We will be somewhere between 110 million and 140 million on Dec. 31st depending on prices. Interest costs of 10-15 million per year on a business that is earning 10 million in free cash flow per month... stupidly sustainable.
the drop in the CAD has offset most of the decine in oil prices from 90 dollars. Gas prices are back over 5.00 with winter around the corner...