Quote:
Originally Posted by red sky
With AECO and WCS prices in the gutter I would suggest that companies that do not have exposure to US price points will struggle. If you want to play the sector you might as well invest in strong US oil companies like EOG, PXD, and FANG.
A rising loonie with depressed Canadian energy prices does not make for a good recipe. The industry as a whole will and is starting to change. As prices go up and companies are generating free cash flow, you will start to see share buybacks and increased dividends versus increased capex and production growth. The return on capital, even when oil was $100/bbl, did not really offer a value proposition. Until that formula changes, the sector will remain cautious and tempered.
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exactly right. My understanding is that Tourmaline is now starting to allocate their free cash flow to dividends... that's not really the usual strategy for that management team and it's not really a good signal for where they think their dollars are best put to use.
NG producers are still in some really tough times.