Athabasca Oil Corp T.ATH

Alternate Symbol(s): ATHOF

Energy Oil & Gas E&P

Athabasca Oil Corporation (AOC) is a Canadian energy company with a focused strategy on the development of thermal and light oil assets. AOC’s segments include Light Oil and Thermal Oil. The Thermal Oil segment includes the Company’s assets, liabilities and operating results for the exploration, development and production of bitumen from sand and carbonate rock formations located in the Athabasca region of Northern Alberta. It also consists of two operating oil sands steam assisted gravity drainage projects and a resource base of exploration areas in the Athabasca region of northeastern Alberta. The Light Oil segment includes its assets, liabilities and operating results for the exploration, development and production of light crude oil and medium crude oil, tight oil and conventional natural gas. Its Light Oil segment consists exclusively of the Duvernay in the Greater Kaybob area with about 155,000 gross acres across Kaybob West, Kaybob North, Kaybob East and Two Creeks.

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Athabasca Oil Corp > C$200 Million Unsecured Notes Offering T.ATH

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Comment by cahclickon Jul 30, 2024 10:35am

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Post# 36154308

RE:RE:RE:RE:RE:C$200 Million Unsecured Notes Offering T.ATH

matt2018 wrote: Understand your point but the cash flow projection of the $1.4B ('24-'27) is based on $80 Oil, $12.50 WCS heavy differential, etc.
If you use the $300M to pay off the $200M, then you cant expand Leismer and keep the share buyback going at same time in lower oil price world.
Also keep in mind, they put cash into seed money for Duvernay partnership/drilling.
$200M cdn at 6.75% total debt is small amount considering what they are doing at Leismer, Duvernay and with the share buybacks.
If price of oil goes back up and stays there, then there will be plenty of cash to go around and pay this $200M loan off much earlier.
But as we have seen recently, Oil price is easily manipulated and you cant keep changing plans based on that.

cahclick wrote:

Here's a cut and paste from their Q2 report . . .

"Cash Flow: Adjusted Funds Flow of $149 million with an Operating Netback of $52.59/bbl. Athabasca (Thermal Oil) expects to generate $1.4 billion of Free Cash Flow1 during the timeframe of 202427."

If they're going to generate $1.4 billion of FCF, why borrow $200 million ? They already have enough cash to pay out existing debt.

I understand that the interest rate is 3 points lower but just don't get why they're doing this given their income stream and cash on hand.