RE:Net Debt at $286M...$250 Target> Hope $36M can be paid down by end of Q4 this year With cash flow strategically allocated between high rate of return capital expenditures, and the achievement of the Company's previously announced net debt targets, Management currently forecasts that the Company will achieve its previously announced Phase 2 return of capital net debt target in late Q1/24 or early Q2/24, based on current pricing.
The price of WTI has been strong but most people have not noticed that the WCS WTI differential has widened considerably since July.
https://www.bnnbloomberg.ca/trudeau-s-delayed-pipeline-is-weighing-on-canada-oil-prices-1.1993275 The differential increasing from $10 to $27 has taken a lot of cash out of the pockets of Canadian oil producers during the first month of Q4. This might continue until the TMX pipeline is finally up and running.
I think Q2/2024 is the earliest that SGY will be able to move to their Phase 2 debt target. If TMX is ready to go and the WCS differential is much improved, the dividend could easily be bumped up to 5 or 6 cents per month compared to 4 cents per month now.
Paul has said before that he does not want to get too carried away with increasing the dividend. Hopefully SGY can work on share buybacks next year and get the outstanding share count back under 100 million.