There are 3 points to keep in mind about Connacher's debt.
1) Connacher is currently producing over 3,058 boe of crude oil equivalent. According to the Q-3 Report 1,095 bbl of oil and 11,774 Mcf/d of natural gas over 9 months. Connacher also presently has 5,000 Mcf/d behind pipe ready to be hooked up. Now Connacher already stated in Investor Presentation for the Summer/ Fall 2009, on page 8 , under the heading Operational Goals that it projected that its bitumen production would be 20,000 bbl/d and its conventional natural gas production (not including conventional oil production) would be 20,000 mcf/d in 2011. These numbers would rise to 50,000 bbl/d of bitumen in 2015 and 50,0000mcf/d of natural gas production. Your debt projections fail to include the value of Connacher's natural gas and conventional oil production, which Connacher has stated all along will equal its bitumen production. This needs to be added to Connacher's cash flow concerning paying off the debt, not just bitumen production going forward.
2) Dick Gusella stated on the Conference call that he wasn't too concerned about the debt down the road as he stated that the terms can always be renegotiated and extended. So this needs to be taken into consideration when one looks at paying down the debt.
3) The principal does not have to start being paid off until 2012.
Best Wishes; Scott
