I would agree that information is lacking re the terms of the hedges. I do think the existence of the hedges, which triggered a 4 million $ cost recognition in Q3, is definitely meaningful for a company with the overall cash generation of this one. Whether the quality of the oil results in a further erosion is an issue is beyond anyone's control but is less significant than a short term 25$/pb opportunity cost when a company is scraping to avoid further capital calls.
It would be relevant reporting by the company to provide detailed clarity on the hedges so that appropriate conclusions could be drawn about short and medium term cash flow generation.
ELK Price at posting:
7.4¢ Sentiment: None Disclosure: Not Held
