Retired Aviator
Deep value, special situations, contrarian, closed-end funds

Chesapeake Granite Wash Trust Revisited

Last March I wrote my first bullish article on Cheaspeake Granite Wash Trust (NYSE:CHKR) that argued the shares (units) had been oversold, relative to likely future distributions. The trust had reported that its original estimated 44,000 MBOE of recoverable oil and gas Reserves had dropped by 10,000 MBOE due to the wells experiencing lower pressures than expected. In addition, since then the Reserves estimates have deteriorated further along with very disappointing production results. This last quarter the MBOE production declined 4% sequentially at a time when the increased well count should have caused production to increase, per the Trust's original projections. In sum, production volumes have seriously disappointed and the original MBOE production estimates should now be...

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