Peyto Exploration & Development Corp T.PEY

The undisciplined Natgas producers are at it again!

[houbahop]

Raising production and flooding NA markets soon, despite a large increase in LNG exports that should climb from 12 to 14 Bcf/day in 2022.

https://www.eia.gov/naturalgas/weekly/

From EIA's STEO (Short Term Energy Outlook), Natgas production should surpass end of 2019 record production of 97 Bcf/day by mid-2022.

According to projections, current production of 95 Bcf/day should climb to over 98 Bcf/day by the end of next year.

Would Chesapeake go bankrupt again?

Looking at Peyto's plan to increase production by 10% in 2022 after an increase of 18% in 2021 compare to 2020 levels, it is foreseeable that Nat Gas prices will be back in the gutters soon if other producers follow similar plan
.
Hopefully, Peyto will reduce their pile of debt before EBITDA goes back down under debt covenants.

[shenty46]

And what about prices in Asia and Europe which are now almost 8 times expensive than here.

[TerribleEng]

Global prices don't pay the bills. European prices matter as much as NYMEX did when AECO was trading under a dollar. Now AECO is coupled again with NYMEX because of NGTL upgrades, but US prices cannot stay over $4 for long periods of time. It's just too easy to add production and North America has 600 tcf of proven reserves that are profitable at $2.75. It would take tens of bcf of lng

[ValueInvest978]

@TE you agree with eia steo forecast of $3.98/Mmbtu 2022 average price. In this scenario with a flat production peyto will generate a huge amount of free cash flow, as remarked in December president report, and stock price too will can not stay to this level.

[TerribleEng]

It really all depends on the US Production profile. Oil prices staying high has kind of been a double edged sword. While Peyto is largely unhedged on liquids and will make bank there, longer term it will encourage lots of associated gas like in 2018-2019.  The STEO forecast was heavly based on US gas producer discipline, which for the most part they have been and Oil production taking a

[houbahop]

Well said, TE! Also, there's seems to be many corners in Peyto's environment. ..."The high debt model really paints you into a corner in a down market and makes you vulnerable."... Selling basis deals in a short period of time - out of frustration - that covers years of production is another corner shareholders were painted. But this is starting to belong to the past. Not

[auagntungsten]

It's the USA that doesn't want the Nortic Stream 2 sanctioning Europe if they allow it to operate which I believe is primed and good to go. Biden has the Ukraine and Russia in the Soup as well. Petro Dollar fading and Winter is coming.