Juan Jarrah's questions to OBSIDIAN ENERGY (OBE) leadership • Q1 2018
Question
Juan Jarrah asked for clarity on capital allocation given the mix of asset sales, a disappointing Mannville well, and strong Cardium results, and also questioned how the company's hedge book influences its disposition strategy.
Answer
President, CEO & Director David Lawrence French stated the vast majority of capital will go to the primary Cardium. Regarding dispositions, he explained the primary goal is to fund the acceleration of the Cardium development in the second half of the year, rather than waiting for hedges to roll off in 2019. He affirmed that assets like the Viking and Peace River are quality businesses, but dispositions will be leveraged to immediately redeploy capital into higher-return Cardium projects.