On The Positive Side

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Connacher is a growing exploration, development and production company with a focus on producing bitumen and expanding its in-situ oil sands projects located near Fort McMurray, Alberta

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Road_Warrior

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On The Positive Side

posted on May 04, 2009 02:51PM

On the positive side in Connacher's favour, wells P11 and P12 on page 15 of the presentation are currently in the steaming process and hopefully will add substantially to Connacher's bitumen production in July 2009.

Also, the 4 ESP's that were installed in April will help to reduce overall production costs for the rest of 2009. (page 15 presentation) The chart on page 13 for POD 1 production is also not very accurate as the production at each well pair changes hourly/daily and the chart is a static representation ( a vague approximation).

In addition, Connacher reached agreement in 2008 for the sale of its 250 million barrel asphalt production from MRC for delivery in 2009 at greater than $100 US/bbl which will add to cash flow. (page 33 presentation)

Finally, Connacher has scheduled the turnaround at the MRC for the fall however, if the profit being contributed from the MRC refinery to Connacher's overall cash flow is significant in the fall, I wonder if Connacher can delay the turnaround until the winter of 2009/2010. Why not shut down the refinery for a turnaround at the time of year when it is making the least amount of profit (or is the fall the latest date at which the turnaround can take place?)