Alberta Oil - - JUNIORS -

While you don’t see it said all that of­ten, there is a very real pos­si­bil­ity that nat­u­ral gas prices may never re­cover to a price that many com­pa­nies have long been wait­ing for. Sure, as a com­mod­ity you know that nat­u­ral gas prices are go­ing to al­ways bounce around some­what. The real­ity is that there is a huge amount of nat­u­ral gas that has been un­locked in North Amer­ica. More im­por­tantly, com­pa­nies are get­ting bet­ter and bet­ter at get­ting that gas out of the ground each and ev­ery month.

Seven Gen­er­a­tions is a rare nat­u­ral gas pro­ducer that has not lost mo­men­tum de­spite the bru­tally low gas prices in re­cent years. The com­pany’s liq­uids-rich Mont­ney gas play has al­lowed it to dou­ble pro­duc­tion in 2016 from 2015 lev­els, and nearly triple what the com­pany pro­duced on av­er­age in 2014.

De­spite this suc­cess, Seven Gen­er­a­tions CEO Pat Carl­son is not will­ing to sit on his hands and hope that higher prices will come. In­stead, he is look­ing to push for­ward with new ini­tia­tives that could in­clude pro­duc­ing plas­tics or elec­tric­ity. There is cer­tainly sig­nif­i­cant risk in­volved in head­ing down this road, but the risk-tak­ing gene is what has driven many independent pro­duc­ers to the suc­cesses they have achieved.

Be­sides, it might be about time that this in­dus­try be­came less a pas­sive price-taker for its pro­duc­tion and in­stead took the bull by the horns and gained more con­trol of its des­tiny. Us­ing low cost nat­u­ral gas pro­duc­tion as a com­pet­i­tive ad­van­tage in a ver­ti­cally in­te­grated busi­ness would be a tremen­dous op­por­tu­nity.

As an­other com­pany op­er­at­ing from a po­si­tion of strength, Seven Gen­er­a­tions just paid $1.9 bil­lion for 155 net sec­tions of very com­ple­men­tary Kakwa-Mont­ney land from Para­mount Re­sources.


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