Positive - in the Current Gas Price EnviromentManagement is Engaged
Clearly as our friend PabloLafortune concerns have been addressed, and they are delaying the completion regarding Natural Gas, and have address some hedging concerns.
Spirit River
Six new Charlie Lake wells well tip the scales towards oil, this is a big deal and Kelt will optimize the production out of Spirit River more towards oil, and now we get to see some of Charlie Lake development more at scale. This will ultimately improve the liquids and oil ratios for Kelt.
Wembley/Pipestone
This Gas plant has been struggling for quite some time (9 months to a year), the gas plant was impaired 12.6 MMcf in the second quarter which is enough gas processing to add approximately 2800 - 2900 boe/day impaired. Assuming 66% of free liquids remove in field.
Balance Sheet Intact
Kelt is going to be at a great place year end producing 45,000 - 50,000 boe of liquids production with Liquids improving in Spirit River and Liquids improving in Wembley/Pipestone as well as production.
Kelt with exit the year with 22 million more debt, but they are not pouring more dry gas into a poor market.
So this is really not a setback, its addressing the reality of the current market condition, and the impact of a Gas Plant Issue.
The primary obective here is adding boe at Wembley, and there were many valid questions on the board about bringing on additional DRY gas in the current bad market that have been addressed by management.
Spirit River, could be a big surprize up here with new Charlie Lake wells coming on, and soon we will be focused on the Charlie Lake potential of that area.
Overall I think because they have nothing material has changed because that gas production was not material, and what will be interesting is the Liquids content associated with their 2024 exit produciton of 45-50 thousand boe/day.
MHP
IMHO