RE:RE:RE:RE:A good quarter all consideringThe long term outlook for US natgas seems grim for Canadian producers. Too much associated gas (Permians will produce it regardless if its profitable or not) growth and a coming dichotomy IMO between local (HH) prices and LNG (US producers are signing direct supply contracts, Conoco just did a 20 year deal yesterday). Permian associated gas production is so big now that even 5% growth may throw a monkey wrench in US natgas supply. Doesn't bode well for high cost plays like the Haynesville either.
Canadian natgas needs a more stable (higher) AECO and an acceleration of LNG. Oddly enough, electricity (natgas power generation) mght be the best short term option IMO for smaller producers. Dry gas producers eg Peyto need to let production slowly slip (generates more cashflow too).
Kelt can't rely on natgas. If they got a good offer for Pouce Coupe West they should take it - that production can be replaced by Oak. They've been hedging gas to protect future cashflow but its not working so far. Perhaps they'd be better off hedging some oil instead. Most important though is to have a model where natgas (and NGL) revenue is pure gravy (not relied upon). At 31% oil, they're almost there. And that's what's causing the share price to rise IMO.