Paramount Resources Ltd T.POU

Forecast Interest 17.1 million 2021

[MyHoneyPot]

My Analysis

Break Even

• POU needs 38 dollar oil and 2.50 gas to break even.

100 million FCF or what ever they call it.

• $45 wti, $2.50 gas 18 dollars liquids

350 million FCF or adjusted free funds flow  ($2.50  a share FCF)

• $55 WTI $3.50 gas 20 dollar liquids.

DEBT POU is forecasting pay 17 million in Interest in 2021, their interest rates are really really cheap. 

IMHO

[regardless]

Those are great numbers but just because the debt is cheap doesn't make it a prudent business move to not pay it down.. so they either pay it down Wich adds massive share value as you put it if waterous gives us 170mill Wich we know they won't , and pou paid that down on the debt we'd get a 1.50$ valuation added to our shares  or you take all that free cash flow you think we

[Raymondjames]

Regardless - I wouldn't pay down the debt. The banks will just lower the Loc. Use the fcf to bring on more wells and reward shareholders with a dividend.  

[regardless]

So I'm a situation where they make 350 mill in fcf amd pay down no debt at all , what could a per share divi look like on a one time divi because let's face it , I'd rather have massive share appreciation than a messily 2-4% divi 

[Robertboblaw]

Regardless, you and I are in complete agreement there. No dividends! They're messy and useless. Oh woopy 4% returns. Pointless. Drill baybe drill!!

[Raymondjames]

How does .75 cents share a sound? Share price would go to $7.50 overnight. 

[Raymondjames]

Jim doesn't do anything in a whoopy way. 

[Robertboblaw]

I'm inclined to say that any returns should be reinvested directly back into the business. I'm not in this for a $0.75 dividend. I'm in this for the long haul. This $100 million is better used to drill up more lands and prove up more reserves IMO. Especially given right now the drilling cos are essentially charging a 50% discount on their fees. We could drill 15 additional wells with

[regardless]

I agree but drilling up lands doesn't prove up allready proven lands and since we know that they aren't needi g to prove any of their core holdings then you need to do somethi g with the cash 

[Robertboblaw]

Ok if there are no lands needing to be drilled to prove up reserves, take advantage of the low fees, put some serious wells behind pipe in inventory then. Add the production once prices really take off.