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Opinions Eric Nuttall
Seven Generations Energy LtdVII.TOCOMMENTAug 25, 2015
Stock price when the opinion was issued
As of Apr 07, 2021. Market Open.
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Eric NuttallEric NuttallEric NuttallHe thinks natural gas will be the energy of the future. He is not an energy expert. He has gone with Peyto. Consider taking small positions when there are big market down days. But they must be good companies that will survive. 7 out of 10 of these companies may go under. Think of them as call options.
Brian Acker, CAVII-T vs CR-T? He would stay away from CR-T due to its debt level. VII-T has a good management team, but its slow down in growth highlighted their 50% decline rates in existing assets. This causes too much of their cash flow to still be required for maintenance. He would prefer NVA-T, which trades at a lower multiple of cash flow, has a better balance sheet, and lower decline rates on production.
Eric Nuttall
For this company, the price of natural gas is almost irrelevant because about 60% of production is liquids, and the vast, vast majority of that is condensate, so they are really like an oil company as opposed to a natural gas stock. This is in a hyper growth mode and is out spending cash flow. They will be one of the last companies standing in terms of asset quality. They are in the best spot of the Montney play. The only challenge he sees from now until Oct-Nov is uncertainty around the NDP. They are exposed to a royalty holiday, and if that gets eliminated the net present value of their wells gets decreased by half.