Q1 Hedge Relief - $150,000,000My back of the Napkin Q1 hedge impact on FCF
I am using 85 WTI, $5 U.S. Nymex, $5 CAN AECO Exchange 1.34
This is my best guess.
Q1 2023
Oil/Condensate = 88,503,922
Nymex Gas = 39,465,390
AECO Gas = 22,752,000
Total Q1 hedge relief = $150,721,312 24 cents a share increase just from the hedges rolling off.
So in Q3 Arc generated 580 million in FCF, that means in Q1 2023 they will generate 730 million in FCF if all the other number stay the same as their Q3 numbers were.
However we know in Q1 that production should be about 10,000 boe higher, which should add another 17 million in FCF so Q1 2023 could have 750 million in FCF.
This is based on Q3 numbers and Capex of 372 million, but they have increased their capex numbers significantly and will be spending 450 million a quarter in Capex, 80 million more.
So my guess right now for Q1 FCF will be somewhere around 680 million to 700 million.
Just the relief from the hedges 150 million over 580 million in existing CF is 26% increase in CF forecast for Q1 2023, with no production increases.
IMHO