The following statements were made by Eric Nuttall from Sprott Asset Management on Market Call Tonight about Connacher Oil & Gas:

I bought Connacher shares last week for the first time. I am becoming more optimistic about crude pricing.

Connacher has the most leverage of any oil company in Canada to the crude price because their leverage is a little higher. It's debt to cash flow is about 10x, my rule of thumb is 1 1/2 to 2x , but for an oil sands company it is a little different because they have a huge capital outlay before your cash flows into it again.

I talked to management last week. I'm, pretty confident that they have some asset sales that are going to bring down the debt to a more meaningful level, 8.5x from 10x, which is not phenomenal but it is improving.

They really benefit from an increase in crude oil, and I'm really bearish on gas that's the feedstock for SAGD producers. This is the perfect storm for SAGD producers.

They have a $200 million dollar convert which is coming due in 2012, which they are paying a really high coupon on, and there is some concern on whether they are going to be able to refinance that. I'm really confident that there is going to be strong interest in being able to refinance that. They have the option to refinance half of that in July. I'm pretty confident that they are going to be able to and they will save about $4 million to $5 million dollars in interest charges.

CIBC's Andrew Potter, who I think is a really smart guy initiated on the name this morning. He has a $1.75 target with a $2.00 NAV . That's 45 cents upside on a $1.30 stock. I think that's a pretty good upside. If you're bullish on oil buy the stock, if not it's the antithesis of what you should be buying.

This is what Eric Nuttall said today for what it is worth.

Cheers; Scott