Focus on free cash flow per previous note the new corp presentation dropped tonight.
That is probably the best corporate presentation I have looked at in years. It really lays things out clearly. Tons of great info.
my overly optimistic production numbers lasted less than 24 hours lol. I should have waited for the new deck. So, after removing the egg, this is what I saw :
The Charlie lake Acquisition changes everything.
1. management said they were going to focus on free cash flow and the balance sheet in 2024 in order to get to a divvy. So after spending 25 million on the Charlie Lake land, they are going to pay that acquisition debt down this year.
2. They hedged 30% of production - because nat gas...
3. Cardium drills forecast to fall to 23 wells from 38 last year
4. average production is forecast at 13,800 to 14,200 to maintain the budget and stay on debt reduction targets. With exit of 15,100 and 10ish wells to tie in Q1 clearly they are deferring any production drilling to later in the year depending on commodity prices.
5. 4 CL wells to be drilled and tied in leading to CL average production in 2024 of 620 barrels per day (including 330 boe acquired).
6. 4 CL in 2024 and 7 CL wells in 2025 forecast to add 3328 boe average production next year. By 2028 it will only take 5.5 wells per year to maintain flat 6k per day production.
7. Cardium efficiency pegged at 20k per flowing barrel, Montney wells 15,400, CL 3 mile at 10,900 and CL 2 mile at 12,300.
8. Montney IP 365 type curve is now assumed to be 489 boe/d
9. CL IP type curve is set at 368 boe/d
10. CL land actually totals 124 sections, with 87 sections having a 91% working interest to arrive at the 116 section total.
11. Another section of Montney land was acquired bringing it to 46 sections
12. Just as it happened last year, debt will peak and end of Q1, and drop sharply in Q2 and Q4 as per break up and freeze up drilling lulls.
13. An Additional Montney well is not included in the production forecasts or cash flow numbers but will likely proceed later this year per notes in the slides
14. CL wells pegged at 130-160% IRR for 2 mile and 3 mile configurations
clearly drilling locations and reserves were dramatically upgraded this year. A much better stronger company but low gas prices and digesting the new land will each defer debt reduction about a quarter.