Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

Kelt Exploration Ltd T.KEL

Alternate Symbol(s):  KELTF

Kelt Exploration Ltd oil and gas company. The Company is focused on the exploration, development and production of crude oil and natural gas resources in northwestern Alberta and northeastern British Columbia. The Company's assets are comprised of three operating divisions: Wembley/Pipestone in Alberta; Pouce Coupe/Progress/Spirit River in Alberta, and Oak/Flatrock in British Columbia. The Company’s British Columbia assets are operated by Kelt Exploration (LNG) Ltd., a wholly owned subsidiary of the Company.


TSX:KEL - Post by User

Comment by PabloLafortuneon Sep 27, 2024 11:53am
68 Views
Post# 36244167

RE:RE:RE:Oak essentially 200,000 contigious acres of Montney

RE:RE:RE:Oak essentially 200,000 contigious acres of MontneyMHP, first off none of these big guys operate this kind of asset using a 3rd party plant. That capex is done upfront.

Second, the proper implementation of the profit model elaborated at Enercom is to hedge until the well is paid for. Hedge oil at $78 with an avg strip of $72 and NG such that you are "assured" x months payback (incl. Interest).

Which means when prices are low yes, you park it. See what Tourmaline is doing with Crew's Groundbirch. Or what Chesapeake is doing with DTILs.

And the reason you park it is because it's my understanding you normally drill your best locations first and your best returns are at the beginning of a well's life. To drill complete and tir in your best wells when prices are very low is sheer you know what.

Subject to normal risk/reward with respect to well results.

Which leaves a break-even on paid wells of less than $50 WTI & $1 gas (C$60 *12%, $6 * 88% less $10 cash & misc). Yes you could lose money but very unlikely.

Then you split that paid well cashflow between return to investors and reinvestment to further develop and delineate the play.

You show investors a model like this, there's a lineup wanting to invest. Because risk has been mitigated every step of the way.

Do you really think pro investors invest without a parachute or trapeze without a net? They don't unless the potential return is stupendous which in O&G won't happen in a play like this unless you buy after a severe downturn. Oak is a decent opportunity but it's not Staebrok either.

I'm amateur opinion.
<< Previous
Bullboard Posts
Next >>