Q2 2025 Alvopetro Energy Ltd Earnings Call
Good morning, Thank you for joining us today for our Q2 2025 earnings call I'm joined today by Alison Howard, Our Chief Financial Officer, and Adrian <unk>, Our Vice President asset management.
Morning, everyone. Thanks for joining us today, just a few administrative points before we begin we are recording today's call and we will have a replay available on our website later on this afternoon I'm all the companies have been placed in listen only mode for the duration of the webcast, but you will have a Q&A.
<unk> session at the end of our presentation. So if you have any questions you can start sending those and now you're seeing this in Q&A button that you should see on your screen if you've dialed in by phone you can send us any questions to social media at almost Petro dotcom.
Lastly, we do go through various non-GAAP measures and we make forward looking statements throughout this presentation. So we do encourage you to review all the cautionary statements and additional disclosures both on a corporate presentation and on our most recent management discussion and analysis.
And that was just released yesterday for Q2.
Alright, Thank you Allison.
So as we previously announced we did upgrade our gas sales agreement with <unk> to get us late last year.
As part of that we did increase our for our oil and gas sales volumes by 33%.
That combined with some considerable operational successes has resulted in a very strong start to 2025 for us.
As per last quarter.
<unk> was up 41% quarter over quarter in Q1, and we had a similarly strong quarter in the second quarter here.
Pretty consistent with Q1 and up 50% from from the previous quarter second quarter of last year.
We did have some facility maintenance and inspections in Brazil.
That did impact the quarter.
That was offset by the addition of our new production in Western Canada that averaged 138 barrels of what per day.
As you can see here our July production did continue.
Okay.
Almost 2300 barrels of oil equivalent per day in Brazil, and 134 barrels of oil per day in Canada.
And Adrian.
Adrian will walk through this later, but our strategy here through the rest of this year is to add additional 100% working interest production capacity in Brazil, with a target of getting to 3000 barrels of oil equivalent per day.
NBA <unk>.
Great.
Volumes for 2026.
And then in Canada, you'll see we have drilled an additional couple of wells.
<unk>.
And here later this month and we expect to drill a couple more as we exit this year.
So just jumping into some of the key highlights from our results released yesterday. This first slide here that will go through with our operating Netback again, a reminder, that is a non-GAAP measure.
Yes.
We express it in per barrel of oil equivalent and that's the green bars that you see on the chart.
So we're taking a kit that we start with our realized price.
The very top of the chart, we did topped off royalties and the Orange bar.
The Gray bar, we've aggregated both our production.
Okay.
Expenses and normal.
So looking at Q2.
Q2, 2025, we saw a marginal decrease 47 per Boe realized price.
Overall average realized price company.
So the increase in our realized natural gas prices in Brazil.
Sure.
So she per mcf, but with bringing on our Canadian operations. Our overall companywide realized price did decrease just marginally.
On the royalties that Orange bar, our royalties were down.
Yeah.
From last quarter, if you recall last year.
Historical adjustments in Q1 recognized relating to a dispute on our gross overriding royalties on natural gas.
So without those.
Okay.
And our overall royalties this quarter on an effective royalty rate as a percentage of sales it was four 7%.
<unk>, which was four 2% in Brazil, and then in Canada 16, 3% in Canada. It doesn't include our crown royalty charges.
Any gross overriding royalty is applicable and then on freehold lands are freehold royalty rate as well as Saskatchewan res our surcharge.
Moving onto production expenses and transportation expenses, we've aggregated that in that Green bar there.
Totalling $5 51, this quarter, including production expenses up 537, which is relatively consistent with last quarter and then we do have transportation expense in Canada. Meanwhile, trucking.
That worked out to 14 14 cents per Boe.
Companywide. So overall, we generated a net $54 72 that was up close to $4 from last quarter.
And that includes Brazil operating netback of 50, 608, which was up over $5 from last quarter and then in Canada.
30 to $32 seven U S operating netback. So overall really strong net backs are still in place here and if you look at our operating margin, which is that line at the top that's our operating netback expressed as a percentage of our realized price.
We are at 87% this quarter and overall for the last six quarters, well above 80% and that's really best in class Snapback margins compare kit companies operating in Canada, and South America.
You layer in the fact that we have a very low effective rate in Brazil are eligible for a tax incentives.
15% and the fact that in Canada, we have.
Significant tax pools to offset our current earnings in Canada. So we're not expecting tax in Canada. This year.
Overall that allows us to generate really strong funds flow from operations.
So going into funds flow here, just a reminder, that as cash flow from operating activities for changes in working capital. So this chart just highlights the change from Q1 of $9 2 million in this quarter, we were up $1 1 million to $10 4 million of funds flow.
Simply all of that is due to that royalty change without those historical royalty amounts that I talked about in the operating netback discussion.
Similarly on net income overall operating netback higher with those lower royalties.
Depletion and depreciation expense also.
Decreased compared to last quarter, and then that was offset by lower foreign exchange gains. This period, and then higher current and deferred tax. So overall net income went up about 800000 to $6 8 million this quarter.
On the balance sheet side. These green bars that you see go through our working capital, including cash balances. We've shown that since we started natural gas sales back in July 2020, so over five years now.
This quarter, our operating or sorry, our working capital was $6 8 million. So we did see a bit of a decrease from Q1 and Q Q4, 2024, just we have had higher capital spending in the last two quarters as you've seen so that has resulted in a decrease in working capital that seller.
Very strong working capital position and our cash balance is still 15 million as of.
June 30th.
We are debt free as well as you pointed out.
Alright, so just on our dividend history.
All the way through last year, we paid a dividend that U S <unk> <unk> per share quarterly.
With the.
New gas sales agreement and the higher sales volumes that I walked through earlier, we did increase the dividend starting in the first and second quarters of this year 10 cents per share orally and since inception, when we started the dividend in the third quarter of 2021.
<unk> now paid $58 million U S or $1 60 U S per share back out to shareholders over that time.
Bob.
Just walking through our more I would say disciplined capital allocation model that we've introduced quite a while ago again, our model is to reinvest about half of our cash flows and growth and returned the other half to stakeholders if.
If you look at the chart on the left hand side, the green lines with the black dots are all of the cash inflows each quarter most.
Most recently as Alison walked through $10 4 million of funds flow from operations. This quarter and then all of a different stack bar show the cash outflows in each quarter. So the yellow is the the.
The reinvestment in the various shades of green shows the returned to stakeholders.
Alison noted we did have higher capital expenditures.
Clearly in the last two quarters here as we had simultaneous.
Investment programs happening, both in Canada, and in Brazil, but we would expect that as we move into the fourth quarter.
Reverse.
Okay.
If you look at the pie on the right hand side.
You can see since starting up production.
Natural gas in Brazil.
Cash flow from operations, our funds flow from operations of over $183 billion now.
49% of Thats been reinvested, 48% of its been returned to stakeholders in the remaining 3% represents the portion of what we built that cash and working capital position.
Alison walked through.
Yeah.
So we've established a strong gas infrastructure platform and now our focus is firmly set on our next growth objectives. Our near term target is to be at 18 billion standard cubic feet, a day or 3000 barrels equivalent which will roughly you fill our current gas plant capacity.
Longer term vision is to double this.
So reaching these objectives is planned to come from a combination of our assets are first is our core base of operations, which is cabaret recovery unit has been performing very well and we're looking to further expand this unit capacity with our development well program. This program is currently underway with three of the five wells drilled in our fourth one.
Finishing drilling these funds.
Our biggest growth opportunity is the <unk> project, which is 100% working interest for all the Petro one this is just north of Calgary.
We had a very successful completion late last year on our 183, a three well which saw production now.
We're focused on the completion and the tie in of the 183 D for well that was drilled earlier this year.
For this asset <unk> is assigned to a combination of <unk> reserves contingent and prospective resources to this opportunity.
We're working to migrate this this into production cash flow and support that longer term growth objectives.
And just some more detail on this main growth opportunity and Merck to too. So like I mentioned this is 100% working interest outflow Petro and it's just north of cap rate and its pipeline connected to our sales infrastructure. So earlier. This year, we finished drilling the 183 D for well.
And we're following which followed up on the <unk> hundred success of last year.
Larger shown on the right hand side of the slide we identified 61 meters of net pay over three <unk> secrets is six two to $6. Four this is the same.
Sure.
Okay.
As being produced in February it's just across the fault and it's a bit deeper.
The well was completed.
After we drilled or we completed it with sliding sleeves in the casing program over eight.
Eight spots within the cover suite formation and we have just finished the <unk>.
Completing seven of these leads and we're in the process of configuring the well for for initial production right now.
Note that in our <unk> well, we have production only from the top sequence sequence six four which is in the D. Four wells just the top three sleeves. There that you can see with the cursor on the rate so for the <unk> four well we've completed.
$6 to $6, three and we will put.
Co mingling all of that and putting it on production.
Later this quarter.
Alright so.
Just moving onto their western Canadian entry that we announced on February 5th for this year.
To remind you our initial focus areas on the Manville stack.
This is a resource.
<unk>, the Alberta, Saskatchewan border were on the Saskatchewan side.
Of the border.
It's a multi zone area you can see up to eight different horizons that can be targeted our first two wells targeted the general petroleum in the alloy administer formations that you see there.
And so this is a pretty exciting place I would say.
Got stacked multi zone potential and its really something thats being reinvigorated through the application of both the whole multi lateral drilling technology.
There is a large amount of coverage of oil in place in roughly three to five meters thick sands that were targeting here with excellent reservoir quality.
So the Red Dash line that you see on the map here as our AMIA with our partner the yellow.
As our lands here that you see.
As we announced I think on our last call. We did drill the first two earning wells to earn into this play.
100% or 50% in August those first two wells were drilled at Neal Burke Seles and Lash burn and then more recently, we just finished drilling the next two wells both at Big Gully C. On the northern part of the map sheet there.
And we were able to drill both those wells with eight open whole legs.
Totaling over 90 kilometers.
<unk> horizontal reservoir access and we would expect both those wells to be on production. Later this month. So I would say we're extremely pleased with this entry into Western Canada.
And part of the reason we did this as we've got exposure to much lower geological risk I would say, an excellent and competitive service environment, our individual well costs are much lower and we've got the ability to very effectively apply leading edge technology to a proven resource that can generate very strong.
Economics short cycle times, and rapid payouts and I think we've got a lot of opportunity in our base and that really is starved for capital.
And the nice thing is we've got a.
A big inventory of locations that we can get after year end.
To put this all in perspective, I think it is kind of remarkable that we signed this deal on February 5th of this year and we've already got four wells drilled and we'd expect to have all four on production within the first seven months.
Starting out here, so we're pretty excited about it.
Just talk about the individual well performance from the first two wells that we brought on production.
The two kind of more straight lines that you see here that the upper ones.
Blue line is the type curve that we had established before we did the farm in and then the lower gas line is just basically 80% of that type curve, so respectively would recover 121000 or <unk> 97000 barrels.
Of oil.
Expected ultimate basis, and you can see the rates of return at a $70 <unk> that that type curve can generate close to 100% rates of return payouts of basically a year.
Extremely strong economics, and then from the individual well performance the more jittery lines that you see there the large burn well the green one was the first well that came on production.
And then Neal Burk Southwell was the Blue one so you can see the first one performing within that expectation.
Expectation range, and then Neill Bert well significantly exceeding expectations.
So what we've done here is just created a indicative multiyear development. It shows four wells being drilled this year and then basically 12 wells per year, a total of 52 wells so roughly half of the inventory that we're currently seeing but it just gives you an idea.
What this looks like on a on a multiyear basis the Green line show the.
The dollars and the black lines show the production.
The solid and dashed lines match those type curves that you saw on the previous slide and what is interesting the rate had the green lines Max the right hand axis. So.
You can see for a maximum capital exposure up between seven and say $9 million, we have the opportunity here just at those type curves to build somewhere between the 1100 1400 barrel of oil per day production platform that after returning all the capital has the potential of <unk>.
Generating free cash flow of up to $80 billion. So.
We're off to a good start and we're very excited about this.
So to conclude.
I think we continue to deliver some pretty strong results, obviously, we've still got very attractive.
Natural gas prices with industry, leading operating net backs and margins.
Our strong Q1 and Q2 results this year.
<unk>.
<unk>.
<unk> production growth.
We've got a clean balance sheet very good free cash flow generation capacity that helps really underpin that more balanced capital allocation model that I reviewed earlier for value investors, we're still trading at less than our one P mpv's and about 45% of our two P. M. P B's.
For yield investors that 10 cent per share.
Orally dividend translates into a yield of over 9% and for growth investors I think we've got a very exciting organically funded capital program.
That has the potential to unlock an awful lot of value, especially when you consider consider it relative to our existing enterprise value and I think now with the ability to deploy capital in a high rate of return opportunities both in Brazil, and Western Canada, I think we're positioned better than ever and I think that's a.
Will the investors that Tencent U S per share.
Quarterly dividend translates into a yield of over 9% and for growth investors I think we've got a very exciting organically funded capital program.
It has the potential to unlock an awful lot of value, especially when you consider consider it relative to our existing enterprise value and I think now with the ability to deploy capital in the high rate of return opportunities both in Brazil, and Western Canada.
Salt or that we significantly strengthened our capital allocation model.
I think Q3 in particular is going to be a very exciting quarter for us. We've got a lot of simultaneous activity here and if you think we're going to bring on four wells out of the new wells out of the unit.
Think we're positioned better than ever and I think as a result of that we've significantly strengthened our capital allocation model.
We've just completed this.
Police and that the 183 D four well, which looks extremely exciting expect to have that well on production. Later this month and then the latest two wells that we drilled in Western Canada also coming on online roughly around the end of this month. So it's an exciting time certainly to be available Petro shareholder.
I think Q3 in particular is going to be a very exciting quarter for us we've had a lot of simultaneous activity here and if you think we're going to bring on four wells new wells out of the unit.
We've just completed the completion at the 183 D four well, which looks extremely exciting expect to have that well on production. Later this month and then the latest two wells that we drilled in Western Canada also coming on online roughly around the end of this month. So it's an exciting time certainly to be an outflow petro share.
And with that.
Turn it over to the question and answer period.
Okay, We've got a few questions.
How many drill locations already at Merck Q2, and when do you expect to drill the next well on that property.
Holder.
And with that.
Turn it over to the question and answer period.
So.
If you look at our broader corporate presentation, where you can see is there some actual theirs.
Okay, We've got a few questions.
How many drill locations already at Merck Q2, and when do you expect to drill the next well on that property.
Some aerial photos of the three well pads that we've got so are we.
<unk> hundred 97, one well is producing from one pad, we've got our field production facility.
Yeah.
So.
If you look at our broader corporate presentation, where you can see is there some actual theirs.
At our 183, a three well from another pad in the Deepak 183, whereas the <unk> four well was just drilled and completed from a three different pads, we can probably grow at least six additional locations from those pads and we're looking at licensing another pad.
Some aerial photos of the three well pads that we've got so.
Our 197, one well is producing from one pad, we've got our field production facility.
At our 183, a three well from another pad in the Deepak 183, whereas the <unk> four well was just drilled and completed from sort of three different pads, we can probably grow at least six additional locations from those pads and we're looking at licensing another pad.
To access some of the more southern locations and Thats in the works right now.
So I think the second part of that was when will the next wells being drilled.
We're looking at the contracting and procurement and all of that for those those wells practically speaking, we're probably looking at the.
To access some of the more southern locations.
That's in the works right now.
Into the early part of next year.
So I think the second part of that was when will the next wells being drilled.
We will get the results from this.
Kurt.
The four wells that we're bringing our production incorporate that and then look at restarting drilling next year.
We're looking at contracting and procurement and all of that for those those wells practically speaking, we're probably looking at the.
Okay.
And into the early part of next year.
Do you have any expectation on production rates from the 183 D for awhile.
We will get the results from this this Kurt.
The four wells that we're bringing on production incorporate that and then look at restarting drilling next year.
Yes, we don't really.
Those put up that production guidance.
But if you look at our 183, a three well it's been.
Okay.
Do you have any expectation on production rates from the 183 D for awhile.
Producing about 53 am three per day, roughly and Thats just from that upper sequence that Adrian talked about so we don't really want to speculate but we're obviously completing more of it.
Yeah, we don't really put out those put up that production guidance, but if you look at our 183, a three well it has been.
And we're optimistic about it.
Producing about 53 <unk> per day roughly.
Yeah.
Yeah.
Do you have any drilling plans for block, 183% a portion of the block that is not part of America Q2.
That's just from that upper sequence that Adrian talked about so we don't really want to speculate but we're obviously completing more of it.
Great.
We're optimistic about it.
Yes, we actually just recently we have another prospect that we had identified there we've made an application to the A&P to extend the block.
Yeah.
Do you have any joined hands for block, 183% a portion of the block that has not occurred at America Q2.
And.
We're we're working through all the permitting to do that.
Great.
Yes, we actually just recently we have another prospect that we had identified there we've made an application to the A&P to extend the block.
When the new deadline is but we've got several years to <unk>.
Thank you.
To drill that location. So it's not in the near term plan, but the answer is yes.
And.
We're working through all the permitting to do that I figure when the new deadline is but we've got several years to <unk>.
What are you realizing for Canadian oil cells, if oil sales relative to WCS pricing.
Thank you.
To drill that location. So it's not in the near term plan, but the answer is yes.
I think in Q2, our average realized price in Canada worked out to just under $47.
What are you realizing for Canadian oil sands.
Quickly about a discount of around nine to $10 Canadian.
Oil sales relative to WCS pricing.
From WCS.
I think in Q2, our average realized price and has that worked out to just under $47, probably about a discount of around nine to $10 Canadian.
In Makena partner, which is I think roughly what we're expecting going forward.
Staying on the Canadian side.
Okay.
Neal Burk, NOL being well above the type curve.
From WCS.
In the partner, but she is I think roughly what we're expecting going forward.
Can you discuss the difference in flow rates between the two wells drilled in Canada, and how homogenous teams feed up play.
Staying on the Canadian side.
Yeah.
There's a specific question about Neal burk, NOL being well above the type curve.
I think I got all that yes, a lot of this comes down to doing our part of the part of their variances I think our operator here did an amazing job staying in zone. Most of the time. So I would say that is one of the factors that can contribute to.
Can you discuss the difference in flow rates between the two wells drilled in Canada, and how homogenous teams seem to play.
Different offerings operators, achieving different results the oil gravity and oil viscosity.
I think I got all that yes, a lot of this comes down to doing a part of it part of their variances.
Think our operator here did an amazing job staying in zone. Most of the time. So I would say that is one of the factors that can contribute to.
And the.
Proxy permeability are also big factors I would say.
Yeah.
There is not.
Different operates eight operators achieving different results the oil gravity and oil viscosity.
As you move through the play you do.
There are some geological variability.
And the.
Considerations certainly incorporate we are shooting some seismic around then Neal burk south area to help manage any of those potential risks and that's why you'd look.
Proxy permeability are also big factors I would say.
<unk>.
If there is I'm not.
As you move through the play you do.
There are some geological variability.
Looking at restarting the drilling probably sometime in December so that we can incorporate all of the three D. Seismic can follow up on that good well results that we.
Considerations certainly incorporate we are shooting some seismic around Neal burk south area to help manage any of those potential risks and that's why you'd look.
At here earlier this year.
Looking at restarting the drilling probably sometime in December so that we can incorporate all of the three D seismic and follow up on that good well results that we.
Sorry, I'm just going to leave.
Do you have a view on your outlook for exit production in Brazil. This year.
At here earlier this year.
Yes.
We typically don't provide that type of guidance.
Sorry, just going through these.
I think with the capital plans that we have over the short to medium term I think our near term objective in Brazil are getting to that 3000 barrels of oil equivalent or 18 million cubic feet a day.
Do you have a view on your outlook for <unk> production in Brazil. This year.
Okay.
Yeah.
Yes, we typically don't provide that type of guidance.
It's firmly in our grasp.
On the Canadian side of it I think we put all the pieces in place there that depending on the capital activity.
I think with the capital plans that we have over the short to medium term I think our near term objective in Brazil are getting to that 3000 barrels of oil equivalent or 18 million cubic feet a day.
The pace of that activity you can kind of.
We put all the building blocks with those type curves hopefully we can continue to exceed those but I think if you use the type curve.
It's firmly in our grasp.
On the Canadian side of it I think we've put all the pieces in place there that depending on the capital activity.
The development plan that we put in there is.
Maybe it's conservative with respect to the pace at which we would ultimately do this but it gives you directionally.
The pace of that activity you can kind of.
We put all the building blocks with those type curves hopefully we can continue to exceed those but I think if you use the type curve.
A good sense.
Any plans to repeat share repurchases in Q3.
The development plan that we put in there is.
This year.
Maybe it's conservative with respect to the pace at which we would ultimately do this but it gives you directionally a good.
Well, we have been to be clear.
There is a modest amount of shares being purchase every day and that's something that the board will continue to look at.
A good sense.
Any plans to repeat share repurchases in Q3.
In the future.
The portion of the returns that go to stakeholders looking at the balance of that.
Sure.
Well, we had been to be clear.
Dividends.
There is a modest amount of shares being purchase every day and that's something that the board will continue to look at.
Buybacks.
The Canadian production is rising do you see Canada, becoming an equal size to Brazil in the next three to five years.
In the future.
The portion of the returns that go to stay quarters looking at the balance of that.
Three to five years.
Between dividends and buybacks.
Practically speaking if you look at the well cost for the wells that we're focused on in the Mercury two area right now.
The Canadian production is rising do you see Canada, becoming an equal size to Brazil in the next three to five years.
Swells that look similar to the 183 D for well.
They are just they are more cat they're deeper.
Well three years to five years.
Practically speaking if you look at the well cost for the wells that we're focused on in the Mercury two area right now.
Police seats are more expensive so practically speaking.
They are probably a little bit more.
<unk> expense.
Expenses, certainly on a per well basis, when you compare it to 50% of our.
Well is that look similar to the 183 D four wells there.
They are more cat they're deeper.
That opened a whole multilateral well those wells on a gross basis, our costing about one $8 million Canadian not in U S dollars at our share is 50% or so.
The completions are more expensive so practically speaking.
Probably a little bit more.
Expenses, certainly on a per well basis.
The other interesting thing what I tried to highlight what that indicative multiyear development plan in Canada, it's pretty quickly because of the rapid payouts pretty quickly you get to a self funding state.
When you compare it to 50% of our.
It opened a whole multilateral well those wells on a gross basis, our costing about one $8 million Canadian not in U S dollars at our share is 50% or so.
The total investment exposure on that hypothetical 50, well program.
The other interesting thing what I tried to highlight what that indicative multiyear development plan in Canada, it's pretty quickly because of the rapid payouts pretty quickly you get to a self funding state like the the total investment exposure on that hypothetical 50 well program.
In the 7%.
Nine or even $10 million of Canadian range and that includes the initial two earning wells that we drilled so that's the other nice thing about the Canadian piece as it can become self funding for it pretty quickly.
In the 7%.
Do you have any geopolitical comments regarding Brazil, as it relates to oil and gas operations everything seems stable, but with everything.
Nine or even $10 million of Canadian range and that includes the initial two earning wells that we drilled so that's the other nice thing about the Canadian piece it can become self funding for it pretty quickly.
News around tariffs et cetera.
Yes, I think theres a lot of noise in the markets around certainly around the tariffs and it's not isolated to Brazil I think.
Do you have any geopolitical comments regarding Brazil, as it relates to oil and gas operations everything seems stable, but with the recent.
Canada is impacted by.
Even with a greater extent just given the relative amount of exports that come from Canada to the U S versus <unk>.
News around tariffs et cetera.
Yes, I think theres a lot of noise in the markets certainly around the tariffs and it's not isolated to Brazil, I think you know.
Brazil, only about 12% of their exports are going to the United States.
I think closer to 30% is going for example, China.
Canada is impacted by two.
Even a greater extent just given the relative amount of exports that come from Canada to the U S versus I think in Brazil, only about 12% of their exports are going actually the United States.
A good barometer I think for what the how the market feels about that is how the Brazilian currencies performing relative to other currencies relative to the U S dollar, but I think theres been over 12% appreciation of the currency this year and even some of the more recent tariff announcements.
I think closer to 30% is going for example, China.
A good barometer I think for what the how the market feels about that is how good the Brazilian currency is performing relative to other currencies relative to the U S dollar.
Currencies actually appreciate it so.
That's probably a better scorecards in my personal opinion.
I think theres been over 12% appreciation of the currency this year and even since some of the more recent tariff announcements the currencies actually appreciate it so.
But.
Things are going quite well in Brazil, I think that the.
<unk>.
A track record of stability.
Of contracts if anything the government has been very encouraging and implemented the fact that we qualify for this enhanced income tax.
That's probably a better scorecards in my personal opinion.
But things.
Things are going quite well in Brazil, I think that the.
A reduced income tax program of just 15% that's certainly much more favorable than we have.
<unk>.
A track record of stability.
Our contracts if anything the government has been very encouraging and implemented.
In Canada.
Governments trying to stimulate activity through the reduction of <unk>.
That we qualify for this enhanced income tax.
Royalties, especially for small and medium sized companies so.
A reduced income tax program of just 15% that's certainly much more favorable than we have.
I think I think it's a pretty good.
Place to be.
In Canada the.
Huh.
The government is trying to stimulate activity through the reduction of royalties, especially for small and medium sized companies. So.
Hi, Mike Yeah.
Since our last webcast karri did have a net color on somebody is asking how you are doing pretty good I can move it around pretty well.
I think I think it's a pretty good.
Place to be.
Tying a tie is not that easy so hence the reason I don't have that on but.
Hi, My back yes.
It's a combination of buying back add my shoulder, but no what's going well. Thank you for asking.
Since our last webcast karri did have a net color on somebody is asking how you are doing pretty good I can move it around pretty well.
And that is yet or.
Questions.
Alright, well. Thank you everyone for participating we look forward to doing this again in about three months time, and if you have questions in the interim please give any one of US a call and thank you again for the support.
Tying of times not that easy so hence the reason I don't have that on but.
It's a combination of my neck, and my shoulder button, all its going well. Thank you for asking.
And that is yet or.
Thanks, everyone.
Alright, well. Thank you everyone for participating we look forward to doing this again in about three months time, and if you have questions in the interim please give any one of US a call and thank you again for the support.
Thanks, everyone.