- WPX Energy's (WPX) $1.4 billion impairment charge indicates that the company's Marcellus assets require $4.50+/MMBtu gas to be viable.
- While the write-off is non-cash, it reveals low economic value of one of the company's core assets.
- Yesterday's 10% stock price move appears to adequately reflect the recognition of the low economic value of the Marcellus acreage.
The $1.4 Billion Impairment Charge
The $1.4 billion impairment charge announced yesterday by WPX may come as a surprise to many investors as it relates to dry gas assets and is announced at the time when natural gas prices have actually shown significant strength, rising above $5/MMBtu for the first time in over three years. Particularly surprising...
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