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by Stockwatch Business Reporter

West Texas Intermediate crude for December delivery lost 21 cents to $40.54 on the New York Merc, while Brent for January added four cents to $44.18 (all figures in this para U.S.). Western Canadian Select traded at a discount of $15.10 to WTI ($25.44), unchanged. Natural gas for December lost 7.1 cents to $2.276. The TSX energy index lost 2.78 points to close at 178.19.

Ray Chan's Baytex Energy Corp. (BTE) lost 39 cents to $5.51 on 5.58 million shares, despite promotional efforts yesterday in Toronto by Brian Ector, senior vice-president of capital markets and public affairs. He presented at FirstEnergy's Energy Growth Conference. If wooing investors was his goal, he had his work cut out for him. Baytex's stock has plunged from over $31 in the last 12 months and from over $50 in the last 17 months. It has struggled to cope with low oil prices in part because of its strained balance sheet, which is carrying over $1.9-billion in debt. Baytex has been trying to get on top of things by, for example, suspending its dividend this summer, but such cuts have not endeared it to investors. Mr. Ector insisted in Toronto that Baytex's story is not all doom and gloom. The market may be volatile, but "what has not changed for us is the exceptional assets in our portfolio," he declared. "Exceptional" may be a bit of an overstatement given that only one of Baytex's three core asset groups is making any money. The three groups are the Peace River play in northwest Alberta, the Lloydminster play in Alberta and Saskatchewan, and the Eagle Ford play in Texas. The Eagle Ford assets break even at a WTI price of just $35 (U.S.), so they are profitable, but the Canadian assets need $44 (U.S.) to $47 (U.S.), so they are not. The company has suspended Canadian drilling and is focusing solely on the Eagle Ford. This play now contributes about half of Baytex's 82,000-barrel-a-day production. It is also the reason why Baytex went into so much debt; the company acquired the assets through a $2.8-billion takeover at the height of the market last year. Mr. Ector emphasized that Baytex does not have to start worrying about debt repayments for about 3-1/2 more years. For now, it will just try to keep the debt from going up further. Although Baytex has not released its 2016 guidance yet, Mr. Ector said the company plans to balance spending with funds from operations and does not want to take on any new debt. He said official guidance will arrive next month.

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