Canadian Natural Rsrcs (CNQ.TO)

The street has hated this company from when the Horizons trouble started last year because they are considering it as more of a gas weighted company and for the oil they have they hate the Canadian differentials. 1.3% dividend.

This is the broadest and widest diversified oil/gas play and has one of the best management teams in the country. Gives you a terrific exposure to different types of bitumen. Because they have their own heated pipeline, this allows material to flow more freely. Have all kinds of acreage in the event natural gas gets back to $3.50. Very cheap at 5X cash flow.

Has under-performed all year. It has not done as well as the others so there is catch up. They are not fully integrated so doesn’t benefit from the downstream. Brent vs. WTI impacts them negatively.

Sees some upside potential. Canadian oil prices have not been nearly as strong as West Texas Intermediate. There has been a bit of a discount on heavy oil prices so a lot of Canadian producers, including this one, have been impacted by that.

Got beaten up tremendously but has had a nice rebound in the last 6-8 weeks. About half oil and half gas and of the oil, you have oil sands and heavy oil as well as some international. There is a little bit of risk if the gas price retreats between now and end of October so there might be a bit better entry point. He would like to see it under $30.

Has just added more to his position. Extremely undervalued. Horizon was shut down for a while because of production problems but is now fully back on line so you have the heavy oil side looking awfully good. Good production development growth. Not as levered to natural gas as they used to be so generating great cash flow. Good story. Cheap. Wouldn’t see $40 as being overly expensive.

Is a favourite of his and a bigger holding on the senior side. The market is looking for a rebound when Horizon gets back to 100,000-barrel range. It doesn’t have an upgrader so it is feeling the differential bite. Execution is the key always. Market is sensitive and is looking for execution. A great free cash-flow generator. Has the best leverage amongst the seniors except for Encanna. He added to it recently. The worst is over but it doesn’t mean you can't have problems.

Great Canadian name. Down about 44% from the beginning of the year. Has just had a rally.

He would not be a buyer at this time of oil sands companies

Probably the most disappointing oil/gas stock in Canada in the 1^st half of the year. Ran into problems on natural gas prices and more problems on the widening differential on the heavy oil and to top it all off ran into problems with their Horizon’s unplanned shutdown. Natural gas has improved a little, heavy oil differential has come down very sharply and they are back up to full production on Horizon. Trading below NAV.

Very cheap. People were concerned that none of the oil sands companies would make any money because oil was going down to $60 a barrel and even if they could produce it profitably, couldn't get it out of Alberta. One way or another the government is going to make sure that Alberta can move its oil. No reason it can't be $45 in 12 months.

Falling stock. Thinks oil will soften. Drilling rigs will see to it.

(Market Call Minute.) Very cheap. Has suffered with declining crude.