- Heavy oil is more profitable than light oil in the current environment.
- Profits and cash flow often disappear for heavy oil during industry downturns when the discount expands due to weak pricing.
- The Clearwater play is bringing on extremely low cost heavy oil production.
- The Clearwater play will decrease the corporate breakeven as a more profitable sales mix is established.
- Clearwater will likely enable the company to increase cash flow and profitability throughout the business cycle which will lead to a higher stock price valuation.
For further details see:
Baytex Energy: Extra Heavy Oil Profitability