QEC - Questerre second quarter 2022
President's Message
During the quarter, three new Kakwa wells were brought on production. Leveraging
the strong commodity prices, we recorded adjusted funds flow from operations(1)
of over $12 million for the period.
Protecting our legal rights is our top priority after the Government of Quebec
announced its plans to enact Bill 21 and revoke our licenses without meaningful
compensation. We filed our primary claim in the Superior Court of Quebec this
winter. Our litigation counsel recently engaged one of the Big 4 accounting
firms as an expert witness to quantify our damages. Based on the value of the
multi-Tcf discovery in excess of several billion dollars (on a risk adjusted
basis), we expect this claim will be substantially larger than the notional $100
million the Government has suggested as a settlement. We are also supporting
other stakeholders including First Nations and Quebec royalty holders to ensure
their rights are also protected against the Government's actions.
Our investee company, Red Leaf, where we hold a 40% equity interest, also made
progress on their new technology with a successful third-party review completed
July. The granting of the final permit for a short line railroad terminating on
their land is also very good news for Red Leaf and its refinery permit in the
Uinta Basin in Utah.
Highlights
o Average daily production of 1,909 boe/d and adjusted funds flow from
operations of $12.2 million for the quarter
o Government of Quebec announced plans to enact Bill 21 and revoke exploration
licenses
o Red Leaf completes third-party engineering validation of new design
Contrary to other Western nations with natural gas resources, the Quebec
Government seems to remain unwilling to consider exporting Clean Gas and
alleviating the European energy crisis. This continues to surprise us as well as
many of our Norwegian shareholders. This also conflicts with the recent comments
by the Canadian Government that it is assessing expanding infrastructure to
export energy to Europe. With an approved LNG export facility at Becancour, less
than ten kilometres from our acreage, we could be an integral part of both this
infrastructure and the supply. Though we remain realistic, the upcoming visits
to Canada by the German Chancellor and the President of the European Union to
'secure key partnerships on energy security, critical minerals and clean tech'
might prompt the Quebec Government to reconsider their plans.
The Canadian Government also noted that this infrastructure could then be used
for exporting hydrogen in the long-term. This would align with the growing
number of industrial hubs producing and consuming hydrogen and natural gas that
are transforming existing energy systems, as reported this spring by the World
Economic Forum. We remain convinced that our leading-edge project that
integrates carbon capture, carbon recycling and zero-emission hydrogen, could
deliver on the promise of eliminating emissions while providing both clean
natural gas and hydrogen.
We respectfully reiterate that the policy of the Government of Quebec appears to
be out of touch with the current geopolitical situation and with 21st century
energy systems and technology. Recent polls have shown that the people of Quebec
seem more knowledgeable and they consistently show a majority in favour of
developing local natural gas. We are still struggling with the rationale for the
Quebec Government's course of action in the name of climate change given these
indisputable environmental, economic and strategic benefits.
Although demonstrating the benefits of Red Leaf's technology has taken longer
than expected, we took a step closer with the review by a third-party
engineering firm, Hatch, of their new re-design. Among other things, Hatch
reviewed the material and energy balance, kinetic model, product composition,
loading and unloading as well as preliminary cost estimates for the commercial
plant. They concluded that 'the basic concept is sound and that there is a clear
path to commercialization.' They also concurred with management that a scaled
version of the commercial plant producing over 200 bbl/d will validate and
optimize the current design and improve readiness for commercial development. We
are working with them to find investors and partners for this small commercial
demonstration plant.
Operating & Financial
Our results reflect both the increased volumes and higher commodity prices in
the quarter. With the three new wells tied-in, production for the quarter
averaged 1,909 boe/d (2021: 1,479 boe/d) and 1,600 boe/d for the first half of
the year (2021: 1,579 boe/d). Production volumes in the second half of the year
will be impacted by an unplanned compressor outage at Kakwa in the third quarter
as well as natural declines, partly offset by the planned conversion of our
royalty volumes to working interest volumes at Kakwa North.
We generated $12.2 million of adjusted funds flow from operations for the
quarter and $16.5 million year to date. As capital spending was limited in the
quarter, we recorded a working capital surplus of $10.6 million at the end of
the period. We anticipate this will grow with limited capital spending for the
remainder of this year.
Outlook
While the legal process in Quebec is likely to be protracted, we are committed
to seeing this through. It has been a 20-year investment to make a world class
discovery, engineer it to eliminate emissions almost entirely and secure social
acceptability. The Quebec Government's decision to seek a summary dismissal of
our case has only strengthened our resolve.
If prices remain strong and wells continue to have quick payouts, the operators
of our Kakwa joint ventures could resume drilling late in the fourth quarter.
For the remainder of this year, we plan to build up our cash reserves to fully
participate in these programs to grow our production.
Michael Binnion
During the quarter, three new Kakwa wells were brought on production. Leveraging
the strong commodity prices, we recorded adjusted funds flow from operations(1)
of over $12 million for the period.
Protecting our legal rights is our top priority after the Government of Quebec
announced its plans to enact Bill 21 and revoke our licenses without meaningful
compensation. We filed our primary claim in the Superior Court of Quebec this
winter. Our litigation counsel recently engaged one of the Big 4 accounting
firms as an expert witness to quantify our damages. Based on the value of the
multi-Tcf discovery in excess of several billion dollars (on a risk adjusted
basis), we expect this claim will be substantially larger than the notional $100
million the Government has suggested as a settlement. We are also supporting
other stakeholders including First Nations and Quebec royalty holders to ensure
their rights are also protected against the Government's actions.
Our investee company, Red Leaf, where we hold a 40% equity interest, also made
progress on their new technology with a successful third-party review completed
July. The granting of the final permit for a short line railroad terminating on
their land is also very good news for Red Leaf and its refinery permit in the
Uinta Basin in Utah.
Highlights
o Average daily production of 1,909 boe/d and adjusted funds flow from
operations of $12.2 million for the quarter
o Government of Quebec announced plans to enact Bill 21 and revoke exploration
licenses
o Red Leaf completes third-party engineering validation of new design
Contrary to other Western nations with natural gas resources, the Quebec
Government seems to remain unwilling to consider exporting Clean Gas and
alleviating the European energy crisis. This continues to surprise us as well as
many of our Norwegian shareholders. This also conflicts with the recent comments
by the Canadian Government that it is assessing expanding infrastructure to
export energy to Europe. With an approved LNG export facility at Becancour, less
than ten kilometres from our acreage, we could be an integral part of both this
infrastructure and the supply. Though we remain realistic, the upcoming visits
to Canada by the German Chancellor and the President of the European Union to
'secure key partnerships on energy security, critical minerals and clean tech'
might prompt the Quebec Government to reconsider their plans.
The Canadian Government also noted that this infrastructure could then be used
for exporting hydrogen in the long-term. This would align with the growing
number of industrial hubs producing and consuming hydrogen and natural gas that
are transforming existing energy systems, as reported this spring by the World
Economic Forum. We remain convinced that our leading-edge project that
integrates carbon capture, carbon recycling and zero-emission hydrogen, could
deliver on the promise of eliminating emissions while providing both clean
natural gas and hydrogen.
We respectfully reiterate that the policy of the Government of Quebec appears to
be out of touch with the current geopolitical situation and with 21st century
energy systems and technology. Recent polls have shown that the people of Quebec
seem more knowledgeable and they consistently show a majority in favour of
developing local natural gas. We are still struggling with the rationale for the
Quebec Government's course of action in the name of climate change given these
indisputable environmental, economic and strategic benefits.
Although demonstrating the benefits of Red Leaf's technology has taken longer
than expected, we took a step closer with the review by a third-party
engineering firm, Hatch, of their new re-design. Among other things, Hatch
reviewed the material and energy balance, kinetic model, product composition,
loading and unloading as well as preliminary cost estimates for the commercial
plant. They concluded that 'the basic concept is sound and that there is a clear
path to commercialization.' They also concurred with management that a scaled
version of the commercial plant producing over 200 bbl/d will validate and
optimize the current design and improve readiness for commercial development. We
are working with them to find investors and partners for this small commercial
demonstration plant.
Operating & Financial
Our results reflect both the increased volumes and higher commodity prices in
the quarter. With the three new wells tied-in, production for the quarter
averaged 1,909 boe/d (2021: 1,479 boe/d) and 1,600 boe/d for the first half of
the year (2021: 1,579 boe/d). Production volumes in the second half of the year
will be impacted by an unplanned compressor outage at Kakwa in the third quarter
as well as natural declines, partly offset by the planned conversion of our
royalty volumes to working interest volumes at Kakwa North.
We generated $12.2 million of adjusted funds flow from operations for the
quarter and $16.5 million year to date. As capital spending was limited in the
quarter, we recorded a working capital surplus of $10.6 million at the end of
the period. We anticipate this will grow with limited capital spending for the
remainder of this year.
Outlook
While the legal process in Quebec is likely to be protracted, we are committed
to seeing this through. It has been a 20-year investment to make a world class
discovery, engineer it to eliminate emissions almost entirely and secure social
acceptability. The Quebec Government's decision to seek a summary dismissal of
our case has only strengthened our resolve.
If prices remain strong and wells continue to have quick payouts, the operators
of our Kakwa joint ventures could resume drilling late in the fourth quarter.
For the remainder of this year, we plan to build up our cash reserves to fully
participate in these programs to grow our production.
Michael Binnion
Redigert 11.08.2022 kl 00:35
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Fra 23.august når bill er implementert, så slipper dere å bruke èn kalori på å spekulere lenger på Quebec og tillatelse. Fokuser på det de har feks montney.
Redigert 18.08.2022 kl 19:22
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6710
18.08.2022 kl 19:47
3096
Det er krystal klart, skal Canada bidrage med naturgas om nogle år, så vil Tyskland have det så klimavenlig som muligt, samt Canada vil levere dette så klimavenlig som muligt.
Jeg ved godt Quebec har besluttet som den har ang fx naturgas.
MEN gassen her er noget af det fineste i Verden, samt det kan udvindes så klimavenligt med de nyeste teknikker som findes.
Set nu, er det faktisk win-win over en periode, inden hydrogen overtager dette behov.
Hvis dette gasfelt skal bruges fornuftigt, så er tiden til dette nu og være klar indenfor 2-3 år om alt flasker sig, ser man kun på et af flere fordele ved dette felt, fx transport af gassen, så er der her 10-12 km til tilslutning fremtidig gas-udskibning, østkysten.
Vi snakker en overgangsfase med gas, derefter kan hydrogen udvindes fra de brugt gasbrønde i dette felt, hvis behovet er der.
Jeg ved godt Quebec har besluttet som den har ang fx naturgas.
MEN gassen her er noget af det fineste i Verden, samt det kan udvindes så klimavenligt med de nyeste teknikker som findes.
Set nu, er det faktisk win-win over en periode, inden hydrogen overtager dette behov.
Hvis dette gasfelt skal bruges fornuftigt, så er tiden til dette nu og være klar indenfor 2-3 år om alt flasker sig, ser man kun på et af flere fordele ved dette felt, fx transport af gassen, så er der her 10-12 km til tilslutning fremtidig gas-udskibning, østkysten.
Vi snakker en overgangsfase med gas, derefter kan hydrogen udvindes fra de brugt gasbrønde i dette felt, hvis behovet er der.
Redigert 18.08.2022 kl 19:49
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minsin
19.08.2022 kl 10:16
2761
Hei ja.. helt enig med deg - var nok litt "slørvat" med tallene - Arendalsuka tar litt kapasitet , men etter partileder debatten i natt er den over for min del...
Det med 30 pst nedgang på olje og 30 pst oppgang var bare ett senario på at - resultatet for QECs del vil falle betraktelig ved lavere oljepris- og at økning gassprisen alene ikke klarer å kompensere for dette mht netto resultatet. for Q3 /Q4.
Mener selv at vi kan komme i en situasjon der oljeprisen avtar gr prod økning og mangel på etterspørsel.... samtidig som det blir økende knapphet på gass og vi får økende gasspris.
Tviler litt på at vi matcher q2 i q3.... selv med 500 ekstra i produksjon, men klarer vi å holde 7 mill + net income i kvartalene fremover mener jeg at 4 kr kan forsvares greit
Ser også endel her inne drømmer om tidligere kursmål på 30 - i 2010 var kursen sist oppe i 30+ - da hadde QEC 234 mill aksjer... selskaps verdien var da ca 7 mrd. dersom vi i dag skal oppnå samme selskaps verdi , vil aksjekursen være ca 16-17 kr... nå er det midlertidig 429 mill aksjer i selskapet
Kun tiden vil vise om selskaps verdien kommer opp i 7 mrd .. altså en 10 dobling
Det med 30 pst nedgang på olje og 30 pst oppgang var bare ett senario på at - resultatet for QECs del vil falle betraktelig ved lavere oljepris- og at økning gassprisen alene ikke klarer å kompensere for dette mht netto resultatet. for Q3 /Q4.
Mener selv at vi kan komme i en situasjon der oljeprisen avtar gr prod økning og mangel på etterspørsel.... samtidig som det blir økende knapphet på gass og vi får økende gasspris.
Tviler litt på at vi matcher q2 i q3.... selv med 500 ekstra i produksjon, men klarer vi å holde 7 mill + net income i kvartalene fremover mener jeg at 4 kr kan forsvares greit
Ser også endel her inne drømmer om tidligere kursmål på 30 - i 2010 var kursen sist oppe i 30+ - da hadde QEC 234 mill aksjer... selskaps verdien var da ca 7 mrd. dersom vi i dag skal oppnå samme selskaps verdi , vil aksjekursen være ca 16-17 kr... nå er det midlertidig 429 mill aksjer i selskapet
Kun tiden vil vise om selskaps verdien kommer opp i 7 mrd .. altså en 10 dobling
Redigert 19.08.2022 kl 10:26
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MC Axel
19.08.2022 kl 12:06
2636
It is almost certain that the third quarter will be the best ever 😁
and the 4th quarter will be even better, because the production then is fully operational again. The gas and oil price is usually higher in winter 😊
I am convinced that the QEC share price will be much higher in the new year than it is today, just wait and see
and the 4th quarter will be even better, because the production then is fully operational again. The gas and oil price is usually higher in winter 😊
I am convinced that the QEC share price will be much higher in the new year than it is today, just wait and see
Redigert 19.08.2022 kl 12:08
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minsin
19.08.2022 kl 18:13
2492
Se her ja... da var Tyskland & Europa i gang .
https://www.tu.no/artikler/tyskland-tar-grep-for-a-hjelpe-folk-med-stromregningen/521565
Prakt eksempel på stimuli som fører økte gass priser, flere land vil bli tvunget følge på med tilsvarende subsidier
Slutt prisen på Gass blir billigere med mindre moms - som igjen gjør at noen grupper kan tillate seg og bruke mere gass , siden den plutselig oppleves som "billig" .
9.296 +0.108 (+1.18%) nå- når passerer den 11.0 ???
Samme som skjedde med strømprisen i Norge , når myndighetene begynte å subsidiere
https://www.tu.no/artikler/tyskland-tar-grep-for-a-hjelpe-folk-med-stromregningen/521565
Prakt eksempel på stimuli som fører økte gass priser, flere land vil bli tvunget følge på med tilsvarende subsidier
Slutt prisen på Gass blir billigere med mindre moms - som igjen gjør at noen grupper kan tillate seg og bruke mere gass , siden den plutselig oppleves som "billig" .
9.296 +0.108 (+1.18%) nå- når passerer den 11.0 ???
Samme som skjedde med strømprisen i Norge , når myndighetene begynte å subsidiere
Redigert 19.08.2022 kl 18:17
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6710
19.08.2022 kl 18:58
2436
Ja, dette debateres flittigt, men indtil videre vil EU og de forskellige lande ikke sætte loft på fx gaspriser, spørgsmålet er om de kan det.
Når det gælder den fri marked, så hjælper det ikke at ville bestemme loftet, så det må ske frivilligt igennem dialog.
Vi har ikke set toppe på gaspriser, men jeg kan sagtes forstille mig, man alligevel finder et loft.
Det siger sig selv, man ødelægger ikke sin fødekæde(indtjening) ved at lade priser stige, så det hele går i stå, for så uddør man selv.
Tror prisen på gas vil stige, men vil derefter holdes i snor, tror jeg.
Uanset tjener -på nuværende niveau, QEC veldig godt.
Når det gælder den fri marked, så hjælper det ikke at ville bestemme loftet, så det må ske frivilligt igennem dialog.
Vi har ikke set toppe på gaspriser, men jeg kan sagtes forstille mig, man alligevel finder et loft.
Det siger sig selv, man ødelægger ikke sin fødekæde(indtjening) ved at lade priser stige, så det hele går i stå, for så uddør man selv.
Tror prisen på gas vil stige, men vil derefter holdes i snor, tror jeg.
Uanset tjener -på nuværende niveau, QEC veldig godt.
Redigert 19.08.2022 kl 18:59
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OPC1000
19.08.2022 kl 21:44
2224
Har kjøpt endel aksjer de siste dagene i den tro at det ville oppstå spekulasjoner i forkant av besøket fra Tyskland.
Ser ut som at det er en stor tabbe. Aksjen er helt død.
Ser ut som at det er en stor tabbe. Aksjen er helt død.
Yzf R1
19.08.2022 kl 21:55
2205
Da får du selge å vil tro du får pengene dine igjen ,vis ikke så er jeg imponert
MC Axel
20.08.2022 kl 17:13
1874
German Olaf Scholz comes to Canada to sign an energy contract. Here’s why it matters
Natalia LeeAugust 20, 2022
https://canadatoday.news/qc/german-olaf-scholz-comes-to-canada-to-sign-an-energy-contract-heres-why-it-matters-2-13896/
Natalia LeeAugust 20, 2022
https://canadatoday.news/qc/german-olaf-scholz-comes-to-canada-to-sign-an-energy-contract-heres-why-it-matters-2-13896/
Forsiktig
20.08.2022 kl 17:18
1859
Nå skal Stoltenberg til Canada rundt den 24 August. Vil dette hjelpe til med kursen til qec tro? At han legger inn noen gode ord til sine kollegaer i den Canadiske regjeringen om å la qec ta i bruk sin nye miljøvennlige teknologien på feltene sine i Canada. I et forsøk på å løse gass krisen.
Redigert 20.08.2022 kl 17:21
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minsin
20.08.2022 kl 17:36
1843
Hehe Stolenberg ja..
Det neste vesentlige besøket som kommer til Canada, er nok det som kommer i september, Europa kommisjonens president , Ursula von der Leyen.
Igjen blir hoved tema sikre vedvarende snarlige energileveranser , gass som sådan :-)
https://pm.gc.ca/en/news/readouts/2022/06/27/prime-minister-justin-trudeau-meets-president-european-commission-ursula
Du skal se , det blir vel etter dette møtet at Canada kommer til og gjøre det samme som EU parlamentet og - kommisjonen - vedta gass blir grønn energi og vipps så er Quebec med problemstillingen "Bill 21" irrelevant, erstatnings søksmålene skrinlagt .Alle parter vil kunne gå med hevet hode- til det beste for alle
https://e24.no/olje-og-energi/i/z7aOb1/eu-parlamentet-sier-ja-til-aa-groennmerke-gass
Politikerne finner som oftest den letteste vei rundt tingenes tilstand ....på godt og vondt
Det neste vesentlige besøket som kommer til Canada, er nok det som kommer i september, Europa kommisjonens president , Ursula von der Leyen.
Igjen blir hoved tema sikre vedvarende snarlige energileveranser , gass som sådan :-)
https://pm.gc.ca/en/news/readouts/2022/06/27/prime-minister-justin-trudeau-meets-president-european-commission-ursula
Du skal se , det blir vel etter dette møtet at Canada kommer til og gjøre det samme som EU parlamentet og - kommisjonen - vedta gass blir grønn energi og vipps så er Quebec med problemstillingen "Bill 21" irrelevant, erstatnings søksmålene skrinlagt .Alle parter vil kunne gå med hevet hode- til det beste for alle
https://e24.no/olje-og-energi/i/z7aOb1/eu-parlamentet-sier-ja-til-aa-groennmerke-gass
Politikerne finner som oftest den letteste vei rundt tingenes tilstand ....på godt og vondt
Redigert 20.08.2022 kl 18:04
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minsin
20.08.2022 kl 18:50
1752
The Stephenville hydrogen plant is just a side kick , don`t belive that this is the main goal of the meeting.
Takes too long time and dosn`t exactly fit the words "aggressive timelines".
The germans have main focus to sort out the short term problems , related to gas deliveries.
The link indicate the urgent of short term solutions
https://www.euronews.com/2022/08/19/germany-lowers-natural-gas-tax-to-ease-burden-on-consumers#:~:text=Germany%20will%20temporarily%20lower%20taxes,the%20end%20of%20March%202024.
When germans are talking about "aggressive timelines" - the lng Production will start up nxt summer/autumn, to solve the ongoing problems... wether the enviromental quebecers like it or not ;-)
Takes too long time and dosn`t exactly fit the words "aggressive timelines".
The germans have main focus to sort out the short term problems , related to gas deliveries.
The link indicate the urgent of short term solutions
https://www.euronews.com/2022/08/19/germany-lowers-natural-gas-tax-to-ease-burden-on-consumers#:~:text=Germany%20will%20temporarily%20lower%20taxes,the%20end%20of%20March%202024.
When germans are talking about "aggressive timelines" - the lng Production will start up nxt summer/autumn, to solve the ongoing problems... wether the enviromental quebecers like it or not ;-)
Redigert 20.08.2022 kl 19:26
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sigj2
20.08.2022 kl 19:26
1696
Forbudet trer i kraft snart åkke som.det er jo blitt bestemt for lengesiden.de fransktalende folka der er desverre ikke til å rikke på uansett hvordan verden har blitt nå.
Bare å vente på erstatning.noe anna er å tro på julenissen men er lov å håpe.
Bare å vente på erstatning.noe anna er å tro på julenissen men er lov å håpe.