Hi Dan,
Lightstream continues to plummet ($.50 today, down another 7+%). More than a little sentiment seems to be
expecting bankruptcy. Until very recently you and some of us would have regarded implosion of the company
as very unlikely. What's your real-world take as we start the long Feb slump ahead?
lightstream (LSTMF)
Re: lightstream (LSTMF)
Lightstream has 7,750 BOPD hedged at $80.81 through the end of June. My "real world take" is that if oil prices do not show signs of moving higher by Q3 their bankers are going to get very nervous, BUT I think they will work with the company.
My forecast model assumes their average realized price for oil is $62Cdn/bbl for 2015.
Lightstream expects to average 30,000 to 32,000 boepd production during 2015. If they do average $62Cdn/bbl for their oil, the company should generate over $200 million in cash flow from operations (net of interest expense). Energy Sector banks will work with an upstream company as long as they are making the interest payments.
Their year-end reserve report should help calm some nerves. 4th quarter cash flow from operations should be around $90 million.
My forecast model assumes their average realized price for oil is $62Cdn/bbl for 2015.
Lightstream expects to average 30,000 to 32,000 boepd production during 2015. If they do average $62Cdn/bbl for their oil, the company should generate over $200 million in cash flow from operations (net of interest expense). Energy Sector banks will work with an upstream company as long as they are making the interest payments.
Their year-end reserve report should help calm some nerves. 4th quarter cash flow from operations should be around $90 million.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: lightstream (LSTMF)
Dan, what is your assessment of LSTMF as of today (another big drop) - do you think it will survive?
Re: lightstream (LSTMF)
sorry - did not see your earlier post of today
Re: lightstream (LSTMF)
My forecast model for Lightstream is on the EPG website under the Small-Cap tab.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: lightstream (LSTMF)
From Keith Kohl at The Energy Investor:
Lightstream set its capital budget this year between $100 and $120 million, which is
funded by internally generated cash flow. Up to two-thirds of the company’s capital
expenditures were targeted for the first half (with about $60 million spent during the
first quarter). Moreover, the company shelved its second-half drilling program.
The company expects its 2015 production to average between 30,500 and 32,500
boepd.
Now, the plan is to try and sell off its Bakken business unit over the next two years,
allowing the company to transform its balance sheet and transition itself into an
Alberta-based growth company.
Although the company’s decision to suspend its dividend didn’t sit well with us, it was
a prudent decision to make. As it stands now, the company will generate between
$145 and $165 million from its operations (assuming an average oil price of $52 per
barrel), which is well above its capital spending.
We’re looking at the long-term potential right now. In fact, the single greatest concern
shareholders have had over the last few years has been about Lightstream’s debt. We
know the company is addressing this issue and has significantly reduced its debt since
2013.
Lightstream Resources is currently rated a HOLD.
Lightstream set its capital budget this year between $100 and $120 million, which is
funded by internally generated cash flow. Up to two-thirds of the company’s capital
expenditures were targeted for the first half (with about $60 million spent during the
first quarter). Moreover, the company shelved its second-half drilling program.
The company expects its 2015 production to average between 30,500 and 32,500
boepd.
Now, the plan is to try and sell off its Bakken business unit over the next two years,
allowing the company to transform its balance sheet and transition itself into an
Alberta-based growth company.
Although the company’s decision to suspend its dividend didn’t sit well with us, it was
a prudent decision to make. As it stands now, the company will generate between
$145 and $165 million from its operations (assuming an average oil price of $52 per
barrel), which is well above its capital spending.
We’re looking at the long-term potential right now. In fact, the single greatest concern
shareholders have had over the last few years has been about Lightstream’s debt. We
know the company is addressing this issue and has significantly reduced its debt since
2013.
Lightstream Resources is currently rated a HOLD.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group