Here is an article from Financial Post. Seems that if Connacher gets the financing oil sands might be in again.
Connacher deal tests financing waters
Posted: May 22, 2009, 3:59 PM by Pamela Heaven Optimism has seeped into the oilpatch, with a smattering of financings getting done and rising stock prices, but the fortunes of Connacher Oil and Gas Ltd. could indicate whether the enthusiasm stretches to the oil sands.
Connacher, with a market cap of about $234.5-million, is looking for cash to fund its Algar steam-assisted gravity drainage oil sands project. It wants to come up with $150-million, according to one source.
“Everyone is really watching this Connacher financing,” said a Calgary-based banker not involved with the deal. “It is the first marketed oil sands deal we’ve seen in a while. Does the market opening, rally, extend to something like that?”
The Street expected Connacher to price Thursday evening, but a press release has yet to hit the wire. The company closed at $1.07 Thursday, down 17¢ or 14%. It moved into the green Friday, trading around $1.10.
In conjunction with the offering, Connacher is working to secure a revolving credit facility and a construction loan for Algar.
“The capital anticipated to be available pursuant to the facilities, together with the anticipated proceeds of the offering, available cash and anticipated cash flow from operations before changes in working capital, should be sufficient to fund the remaining estimated $200-million of construction costs for Algar, assuming improved commodity prices and stable economic conditions,” Connacher said in a press release on Tuesday which announced its fundraising drive.
Connacher iced its Algar project in late 2008, when oil was trading around US$35 per barrel to US$40 per barrel. A barrel of oil now costs around US$61. The loonie is also on the rise, trading above US87¢ and touching a new seven-month high on Friday.
RBC Capital Markets is the sole bookrunner and co-lead manager on the Connacher offering, with Credit Suisse Securities Inc., and TD Securities Inc. also serving as co-leads.