RE:Canadian dollar another Tail WindIt is my amateur guesstimate that they are covering all their cash costs - operating, transportation, G&A, interest, capex, royalties - with condensate revenue alone at the moment. So that whatever revenue they generate from natural gas and other NGLs is straight to the bottom line. Could be around $400MM annual FCF right now? I'm probably high... there but consider this:
Natural gas is really low. Yesterday I had Q4 HH @$2.97, Q1 @$3.42, Q2 @$3.03 and Q3 @$3.28, an average of $3.18 for rolling 12 months. Q4 HH @ $2.97 basically means the entire year for natgas producers in the US is a write-off, not even 4 quarters for a dollar for some. Which is ridiculous considering the profits being made by LNG traders.
And @ $3.18, many producers are under water in the Haynesville from what I read on twitter (fwiw). (Haynesvill is 15-16% of US natgas production). So the clock is ticking on further production cutbacks IMO. At some point what happened to oil will happen to natural gas IMO.