Obsidian Energy Ltd T.OBE

Crunched q2 numbers 4 h2 forcast

[Kramerkarma]

good and bad news. Pumping up 2.56$ + h2 capex heavy 83.2M$ so 33.8$/ bbl (only on oil) also because pumping costs up ... nat gas needs 4.01 to break even q3 . So it's at that average so far so no profit from gas. So total h2 profit at 72$ wti -4$ light oil -18$ heavy hedged like that .. 1.25fx .is 74.2M without any funny business (1$/share) + capex and aro 83.2M for FFO . Also just a note this has higher than forecast q2 production numbers could go either way tho. Net debt would be 362M$ year end. My q2 and therefor full year numbers were off because +2.6$ costs and heavy oil diff too narrow so per boe 2-4$ to high.almost 6$/boe off.... these things happen. Would love to see costs fall below expectations. Or prices overshoot (very possible)

[kavern23]

Kramer how could obe ever lose money on natural gas right now? OBE owns its own gas plants...have at least two...one in rocky and one in drayton valley...plus more.  It would be under 1.50 mcf in costs.  no way our natural gas needs 4 bucks for operating costs. just use corp netbacks. and do ajustments on that  Capex is interesting. I am not saying to ever use different then OBE

[Kramerkarma]

I do all in costs I want to see as close as possible debt repayment . And it's 20.56$/boe. Add in 3950boe hedged at 2.67$/mcf and 5050boe of strip. 16.02$ - 20.56 all in = -4.54$ so about 24$/5k boe =4$/boe.

[Kramerkarma]

another Note : wti was 66.17 and we got 63.11 great but heavy 39.82 so 23.28$ diff.... not the 15$ i was using. But note q4 we could be looking at 14$ then 2022 10$ woot woot... according to Eric nuttal I should already use 10$ diffs lol

[kavern23]

Suncor fort hills production issues will only help diffentials...less barrels competing to get out. Fort hills production should go on the wood buffalo pipelien down to kirby terminal then eventually to hardisty.  Barrels that would effect things.  wont hurt anyway to have less.

[Kramerkarma]

that's good. Thanks for quoting me I spotted an error that q2 heavy diff is vs light ... heavy vs wti in q2 was 66.17- 39.82 = 26.35 USD ... I don't see how it's that wide but hedge losses only (risk management) .52c/boe. Do you have any info on that kav?

[JohnJBond]

I crunched the numbers too. I had Q2 at 70c funds flow.      It came in a 0.69 (minus the management performance payout). I have Q3 at 85c funds flow.   (still unclear how to forecast management performance payout for Q3).    So next stop, wait to see what Q3 looks like when released around the end of October. ps, pleased they didn't

[Kramerkarma]

so true . What's your q3 heavy price ? Do you think our q2 heavy price was lower than it should have been? Thanks.

[Kramerkarma]

on Twitter I used 2 calculations. One using wti -18 and the other using historic 60% of wti. Just rethinking seeing these messages I said costs could fall but never mentioned or added in rising royalties. So roughly 60M$ debt repayment after increased royalties H2

[kavern23]

Netbacks should increase Q3 and especially Q4 if everything else holds constant as new Cardium production will be an increasing % of production... New Cardium production has lower Royalty rates (so royalty rates could stabilze abit downwards per barrel) and new Cardium wells have cheaper operating costs. Each new barrel in cardium has really good netbacks for at least first 1....... Probably

[kavern23]

I finally had time to look more at surge. Surge in a good comparison for OBE, both high debt turn around situations...well at least OBE has FCF in both Q1 and Q2. But Surge had such a rough quarter.  Do investors even care?...they should...rough quarters eventually lead to problems... Surge sold 2700 BOE and at one time they said First half drilling program added 3400BOE...so 700 more

[Kramerkarma]

if production drops capex per bbl shoots up (for surge) another thing that I didn't mention when talking about the nat gas breaking even at 4$ is because it's sharing the royalties on the oil bbls. So I see your point ... the gas IS profitable but in my calculations it's paying for extra royalties (same total income just counted different). When I had done sgy they had pumping costs of

[kavern23]

Kramer...I would use -30 dollars cad to the cad light  oil price as a good ballpark estimate on the heavy oil. So for Q3...if cad light oil averages 85 bucks then I would use 55 bucks for heavy oil in Q3 as an estimate. 90 cad for light oil then 60...I doubt we ever recieve more then 60 for our heavy oil as even if WTI increased the differentials for ours would just sjyrocket. OBE heavy oil