Ann: Suspension from Quotation, page-38

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Rawk

2,954 Posts.

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01/06/23

07:01

Post #: 68068869
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Originally posted by TheGoss31: ↑

don't think anyone negotiates on the basis of current/historical pricing. there'll always be greater weight to future curves/dynamics - and given lng canada is real / going to operational beyond any doubt, not to mention the couple of other lng projects progressing on the west coast, this would be a huge swing factor in banking that futures curve. current pricing is irrelevant given we aren't looking at producing immediately - what is more important is where the curve is in 2-3yrs and thats sitting at 3-4.50 (vs spot of $2 today) from Jan-25ish (when LNG canada should be ramping up)... every day closer to that start date makes that futures curve all the more real.

at $2/gj this project is breakeven/ish from an NPV perspective (maybe positive with the liquids). at $3-4.50/gj this is anywhere between a $100-400m NPV project. my rough numbers. all comes down to how the bidder looks at this. look at the numbers that were in the peters&co sale flyer at different IRRs (80-370) and that was at a much more conservative gas price curve (July 21 - pre russia). I think fair value (risk adjusted) is somewhere in the middle - say $200m. my 2c worth anyway

now whether a bidder pays that is an entirely different q - why would they when they could lob a bid for the whole co at a 100% premium (20c/$120m mkt cap) and probably get a deal done? that's what we are waiting to see the results of in 3 weeks. my hope is that given glenn has a few mil $ in shares in CE1, he won't give it away for free..

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Sure, it better not influence sale price. Cycles come and go, gas/cond has limited supply. The long term historical chart shows the current price is historically low so it is up from here. Lng project is a goer, Montney development is restricted, the Calima gas/ condensate is in the bank, oil is flowing so a discount for any reason is irrational. Long term it looks like cup forming and $4 region is on the horizon. Looking for an upward trend to breakout of the consolidation but hey all eyes on the deal. I hope they retain % as they will just need to replace it. 3 weekd tick tick...

CE1 Price at posting: 10.5¢ Sentiment: Hold Disclosure: Held
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