How much cash does Saturn really make, and what is a share of it worth?

The words on this page

Real cash (true cash)

What was left in the bank each year after every bill, every tax payment and every well drilled. Not profit, and not "cash flow" as companies usually quote it, which leaves the drilling out. The strictest number there is.

Required return

The yearly return you insist on for taking the risk. A dollar promised in ten years is worth less than a dollar today; this rate says how much less. 9% is a common professional figure for a large Canadian producer; the reserve engineers use 10%.

Well life (reserve life)

How long the wells keep producing. After the life you choose, nothing is counted. Ryder Scott evaluated 219.6 million boe of proved plus probable reserves at 31 December 2025 (144.1 million proved), a 14 year proved plus probable reserve life index against 2025 production and 9 years on proved alone. The model default uses 14 years.

What a share is worth

Every future year's cash, shrunk back to today's dollars at your required return, added up, less the debt, less the cost of cleaning up the wells, divided by the number of shares. Pay less than this and you earn more than your required return; pay more and you earn less.

Where the default growth comes from

Saturn's 2026 guidance of 41,000 to 42,000 boe a day matches 2025's 41,728, so the growth dial starts at 0 per cent.

The arithmetic, step by step

1. Count the real cash each past year: cash generated by operations as reported, plus interest paid put back, minus rent on leases, minus every dollar spent on wells and plants. Buying and selling assets is shown separately.
2. Project it. The starting cash you choose (an average of the history, or the latest year) grows at your growth dial for ten years, then at the long-run rate for as long as the wells keep producing. Nothing is counted after the well life ends.
3. Bring it back to today. Each year's cash is shrunk by your required return, counted at mid-year because cash arrives through the year rather than on 31 December.
4. Turn it into a share value. Add up the shrunk cash; take off net debt of C$762M; take off the C$203M cost of cleaning up the wells if that switch is on; divide by 178.02M shares.
5. Work it backwards. "The growth today's price assumes" is the ten-year growth rate at which this start is worth exactly the share price.

Where the numbers come from

• The history describes a much smaller company. Saturn produced 4,117 boe a day in 2021 and 41,728 in 2025, with the growth bought through five acquisition rounds: Oxbow for $82 million in 2021, Viking and Plato for $248 million in 2022, Ridgeback for $467 million in 2023, Battrum and Flat Lake for about $539 million net in 2024 and $94 million of tuck-ins in 2025. Averages across these years mix five different companies.
• The growth was debt-funded and the debt is the story. Saturn carries US$583 million of 9.625 per cent senior notes due 2029 and net debt of $761.6 million at 30 June 2026 against a market value near $1.1 billion. The true cash formula adds interest back before valuing the business, so the net debt deduction at the end is doing heavy lifting here; the shares also roughly tripled from 2022 to 2025, diluting per-share value along the way.
• Interest is the interest expense line from the financing note of the audited statements ($88.9 million in 2023, $85.2 million in 2024 and $84.9 million in 2025), which excludes paid-in-kind interest, discount amortization and accretion; the 2021 figure of $7.7 million is the cash interest component that note discloses separately. Cash interest paid would differ slightly from expense in most years.
• Net debt by year is Saturn's own measure: the term loan or senior notes plus adjusted working capital, excluding lease liabilities. The aggregator's broader measure runs modestly higher.
• Acquisitions are cash amounts from the statements, net of the $25 million of dispositions in 2024. Consideration paid in shares is not in these figures.
• Saturn has never paid a dividend; shareholder returns are buybacks, which began in 2024 and reached $38.5 million in 2025 plus a further $87 million in the twelve months to June 2026.
• 2023 net income is flattered by large one-off gains and deferred tax recoveries around the Ridgeback deal, and 2021 shows a $65 million loss; cash is the better guide across these years.
• The decommissioning liability of $202.9 million is the discounted balance at 31 December 2025 (about $652.6 million undiscounted at a 10 per cent credit-adjusted rate); Saskatchewan and Alberta both mandate minimum annual clean-up spending.
• Every history year has been hand-checked line by line against the audited annual statements (the 2021, 2023 and 2025 statements cover all five years). Operating cash flow, interest, leases, capital spending, acquisitions, buybacks, net income and weighted share counts all tie to those filings.
• Analyst targets: average C$8.36 across 7 analysts (stockanalysis.com analyst consensus, as shown 30 August 2026).

For the technically minded

The method is the one used to evaluate capital projects, from Ted Lawrence, The Business Guide to Economic Evaluations: Projects, Leases, Tariffs and Acquisitions (2017). "Real cash" is the book's project cash flow (chapter 3) with depreciation, debt servicing and debt-like leases restructured out (chapters 4, 5 and 19); short operating leases stay in as a cost of producing, a chapter 19 judgment. The value per share follows the share-purchase evaluation of chapter 20: present value of the company's cash flows at the cost of capital (chapter 10), mid-year discounting (chapter 12), plus non-required assets, less net debt and the decommissioning liability. "What you gain or lose" is the bid-curve NPV of chapter 20; "when you get your money back" is the discounted payout of chapter 13; the bars follow the project profile of chapter 6. The reverse solve on growth is a plain reverse DCF.

Discount-rate anchors: 9% is a common cost-of-equity figure for a large Canadian producer and 10% is the reserve-report convention (PV10). The long-run rate defaults to 0% here: a depleting resource should not be assumed to grow forever, so anything above zero is a judgment you make with the dial.