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Cardinal Energy Ltd (Alberta) T.CJ

Alternate Symbol(s):  CRLFF

Cardinal Energy Ltd. is a Canadian oil and natural gas company with operations focused on low decline oil in Western Canada. The Company is engaged in the acquisition, development, optimization and production of crude oil and natural gas in the provinces of Alberta, British Columbia and Saskatchewan. Its operating areas include the Midale, South District, Central District, and North District. Its Midale operating area of over 730 million barrels of original oil in place (OOIP) and its low decline in production of 3,200 barrels of oil equivalent per day (boe/d) (net) is supported by both waterflood and CO2 enhanced oil recovery. Its South District operating area is located east of Calgary in southeastern Alberta and produces medium gravity crude, as well as liquids-rich natural gas. Its Central District operation is located in East Central Alberta, which is focused on producing oil from multiple, large OOIP pools. Its North area includes Grande Prairie, Clearwater and other properties.


TSX:CJ - Post by User

Comment by Quintessential1on Oct 29, 2024 3:05pm
105 Views
Post# 36287332

RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Limited damage according to Iran?

RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Limited damage according to Iran?Well your scenerio incorrectly assumes that they are not using debt to pay the dividend already.

If the dividend was not paid debt would be reduced and and debt servicing costs would also go down.

The only time they really use profit to pay the dividend is when they have no debt which hasn't happened in the history of this dividend by CJ.

The dividend is paid in lieu of paying down debt which means that debt pays the dividend.

Even when they paid down debt last quarter they did not pay down all the debt which means the debt paid the dividend in lieu of paying down more debt.

Now the market gauges CJ's ability to manage debt and sustaining costs values the company accordingly and reflects in the share price value.

Now as debt is added to or subtracted from this value goes up and down accordingly.  

The commodity price is what the market uses to guage CJ's ability now to make debt (or the share price value) go up or down.

As CJ continues to add to debt the share price will continue to go down with the market also knowing that the addition of low cost production will add revenue that will help the debt to either stop increasing or go back down.  That is derisking and the closer CJ gets to commissioning the more the makret sees CJ derisking and being able to pay all of its costs and then some in order to have cash left over to pay down....you guessed it ....debt.

As long as CJ has debt they are using it to pay ALL of their other costs.  Including the dividend.

I figured you were invested but quite frankly you paint a gloomy enough picture that I am not sure that I would be invested if I thought the way you do.  I think the divi is covered and I think it is covered by the expanded credit facility.  If you don't, what are you doing about it? 

The credit facility should keep the divi propped up until Reford commissions as the oil prices cycles up and down.  The share price may go up and down.  Trade it, average down, or sit back and just collect the div.  

GLTA
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