Working glossary

The terms we use, defined.

Maintained April 2026 · 16 terms · ~4-minute read

A working glossary of the terms that come up most often in Halvren research. Written for DIY Canadian investors who would rather have one honest sentence than a Wikipedia dump. Every term has a permalink — share the fragment, not the whole page.

AISC All-in sustaining cost #: The mining industry's standard per-unit cost metric, covering direct cash costs plus sustaining capital, corporate G&A, reclamation and royalties. Does not include growth capex. The number operators report; the number to double-check against the peer set.
FCF Free cash flow #: Operating cash flow minus capital expenditure. The actual cash a business generates for shareholders after keeping itself running. For commodity businesses, look at ten years of FCF, not the last twelve months.
WCSB Western Canadian Sedimentary Basin #: The geological basin underlying Alberta, southern Saskatchewan, northeastern BC and southern Manitoba. Home to the majority of Canadian oil and gas production.
SCO Synthetic crude oil #: Upgraded bitumen from the oil sands. The product of taking raw bitumen through an upgrader so it can be shipped and refined like conventional light sweet crude. SCO producers like CNQ's Horizon capture more of the barrel's refined value than raw-bitumen sellers.
Decline rate #: The rate at which a producing well, field, or corporate production base falls off year over year without new capex. Low-decline businesses (10–15%) require far less maintenance capex than typical shale (35–45%), which shapes the entire FCF profile.
NPV10 #: Net present value of future cash flows discounted at 10% — the standard discount rate in Canadian oil and gas reserves reports under NI 51-101. Industry convention, not the right cost of capital for every business or every reader.
AFFO Adjusted funds from operations #: A real-estate and infrastructure metric: FFO less maintenance capex. The closest thing to cash available to equity for REITs and infrastructure operators. Watch the gap between FFO and AFFO; when it widens, the maintenance bill is catching up.
Payout ratio #: Dividends divided by earnings (or by FCF, or by AFFO, depending on the business). A sustainability check. A payout ratio that exceeds 100% over a full cycle is a dividend waiting to be cut.
Royalty #: A share of production or revenue paid to a government or landowner before the producer earns anything. In Canadian mining and oil and gas, royalty rates can materially change the economics of a project; so can changes in the royalty regime itself.
By-product credits #: Revenue from secondary metals credited against the cost of producing the primary metal. A silver mine that also produces gold and zinc will report AISC net of those credits. The credit assumption is where the reported cost quartile often moves around.
Net debt / EBITDA #: A standard corporate leverage ratio. For commodity producers, the honest version is computed on mid-cycle or trough EBITDA, not the last twelve months at peak pricing.
Sustaining capex #: Capital spending required to maintain production at a flat level. The gap between reported capex and sustaining capex tells you how much is actually growth investment — and whether today's dividend is being funded out of growth capex or out of a real surplus.
Cost curve #: The industry-wide ranking of producers from lowest-cost to highest-cost. First-quartile producers survive longer at the trough. Every operator claims first-quartile in their slide deck; read the third-party data.
Per-share value #: Any accounting metric divided by diluted shares outstanding. Production, reserves, cash flow and book value can all grow while the per-share version shrinks through dilution. Which is why we read per-share before we read headline.
Operator of record #: The company named as the operator of a joint venture or development. Operator status confers control over capex pace, reporting, and often outsized influence over economics even below 100% ownership.
Cap rate #: In real estate, net operating income divided by the property's value. A 5% cap rate means the asset yields 5% of its purchase price in NOI before debt service and taxes. Cap rates move inversely to prices; they are also the cleanest way to compare property across markets.

Missing a term? Write to amirali@halvrencapital.com and it will appear in the next revision. The Halvren Checklist and research archive use this vocabulary throughout.