Cold weather…. It will be interesting to see in q1 results 2024 the impact it had on various companies production levels.
The thesis I have is I think the companies with the really low producing ng wells will feel most impact.
Think about it, if you have a well that is producing 10 dollars a day in revenue, just barely producing any ng..like 1 boe a day of ng production...if that well froze off in the -40 weather how can a company justify sending a human body to go look at that well and do maintenance? Aeco gas curve so low, I don't think all wells that are barely producing get turned back on in Alberta.
Part of the reason aeco hit 14 bucks was not just instant demand from really cold weather...also freeze off lowering production. For sure production that was impacted in Alberta.
Ygr wells are so tight and easy to service and with an internal service team of employees, Ygr should have been better able to handle the cold spell than others. Plus Ygr wells make sense to get back online as they don't have the 10 dollar a day wells.
I don't think average public person knows just how many low producing wells that exist in Alberta...that I don't get how the wells can even payback the cost of property taxes or surface lease rent to the farmer or gov. These wells that really hammer economics when aeco is 2 bucks.
Pine cliff energy I see is 1.38 and lol probably that instead of 1 dollar because it is hard for retail person to short it. Most brokers won't allow a retail person to short as under 2 bucks, some brokers it is 3.
I wish I knew the answer to the following question...are liquids ng wells more likely to freeze off than a dry gas well. Or is risk same