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Surge Energy Inc
Symbol SGY
Shares Issued 335,068,916
Close 2020-02-27 C$ 0.86
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Globe says Vermilion's dividend seen at risk

2020-02-28 09:43 ET - In the News

See In the News (C-VET) Vermilion Energy Inc

The Globe and Mail reports in its Friday edition that smaller oil and gas producers may come under financial stress if West Texas Intermediate crude hovers around the $45 level for the rest of 2020 due to coronavirus fears, according to one analyst. The Post's Vanmala Subramani quotes Phil Skolnick, an energy analyst at Eight Capital, said in a note: "Junior oil names could be under stress given weaker netbacks and balance sheets to start off. Vermillion will surely have to cut its dividend or delve itself deeper into debt in this scenario and we believe Surge would also have to make adjustments to outflows to keep leverage in check." Oil prices tumbled for a fifth day on Thursday to their lowest since January, 2019, as further novel coronavirus cases outside China fanned fears that a pandemic could erode demand for crude. China is the world's second-largest consumer of oil and the largest oil importer; any negative impact on demand from the Asian economic giant has massive repercussions for oil prices. "Many of the Canadian oil companies have hedged their production for the next few months, but less so going into 2021," said Jeremy McCrea, an energy analyst with Raymond James. "But not everyone is hedged."

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