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Akaralph  

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  • BreitBurn Energy Partners Maintains Its Distribution - For Now [View article]
    Scooter-

    If oil/NG prices stay below $50, IMO many of the E&P's will make additional distribution cuts and not be able to obtain financing for capital projects. Most could either go out of business or be acquired at pennies on the dollar. A few could survive.

    It amazes me that so many folks are in denial about this - all that is needed is to look back over the past six months at what has happened to them as a group. They remind me of the mREITs.

    There are so many bargains out there in the mid stream MLP's. Of course the yield chasers would rather risk it all than settle for 7 or 8 percent yields.

    They will learn (continue to learn) the hard way.
    Aug 27, 2015. 09:22 AM | 1 Like Like |Link to Comment
  • BreitBurn Energy Partners Maintains Its Distribution - For Now [View article]
    Moody's today downgraded BBEP

    Global Credit Research - 26 Aug 2015
    Approximately $1,150 million of debt affected

    New York, August 26, 2015 -- Moody's Investors Service downgraded Breitburn Energy Partners LP's (Breitburn or BBEP) Corporate Family Rating (CFR) to B2 from B1, its Probability of Default Rating (PDR) to B2-PD from B1-PD, and its unsecured notes rating to Caa1 from B3. Moody's also affirmed BBEP's SGL-3 Speculative Grade Liquidity Rating. The outlook remains negative.

    "Moody's downgrade of Breitburn reflects the company's deteriorating leverage metrics in a low commodity price environment," commented Amol Joshi, Moody's Vice President. "We positively note that Breitburn has lowered its unit distribution and has a significant portion of its 2015 and 2016 production volumes hedged to protect its cash margins. However, the company may face negative free cash flow after 2016 with its hedge positions rolling off, due to low netback per boe given expected low commodity prices."

    Issuer: Breitburn Energy Partners LP

    Corporate Family Rating (CFR), downgraded to B2 from B1

    Probability of Default Rating (PDR), downgraded to B2-PD from B1-PD

    Senior Unsecured Notes, downgraded to Caa1 (LGD-5) from B3 (LGD-5)

    Speculative Grade Liquidity Rating (SGL), affirmed at SGL-3

    Outlook negative

    RATINGS RATIONALE

    Breitburn's B2 CFR reflects its high financial leverage profile, and the structural risks inherent in the master limited partnership (MLP) business model which entails cash distributions and external funding requirements in order to fund growth. The B2 rating also reflects constrained financial flexibility due to the company's high cost of capital. Breitburn's B2 CFR is supported by its size on both production and reserves basis, basin diversification, and relatively high liquids mix. If the weak commodity price environment continues, Moody's expects the company to continue focusing its curtailed capital budget on maintaining production. Moody's expects Breitburn's debt to average daily production and debt to proved developed reserves through mid-2016 to be roughly $55,000 per barrel of oil equivalent (boe) and about $13 per boe, respectively.

    Breitburn's senior notes are rated two notches below Breitburn's B2 CFR under Moody's Loss Given Default Methodology because of the priority claims of its relatively large secured revolving credit facility, which has a borrowing base of $1.8 billion with approximately $1.31 billion drawn under the revolver as of June 30, 2015, and its $650 million in second lien secured notes outstanding.

    The rating outlook is negative. We could further downgrade the ratings if Breitburn is not successful in maintaining adequate liquidity and retained cash flow/debt falls below 10% on a sustained basis. While unlikely in the near-term, we could upgrade the ratings if Breitburn is able to maintain its production base and its retained cash flow/debt is expected to approach 15% when its existing hedge positions mostly roll off.

    The principal methodology used in these ratings was Global Independent Exploration and Production Industry published in December 2011. Please see the Credit Policy page on http://www.moodys.com for a copy of this methodology.

    Breitburn Energy Partners LP is a publicly traded independent oil and gas master limited partnership focused on the acquisition, development and production of oil and gas properties throughout the United States. Breitburn's producing and non-producing crude oil and natural gas reserves are located in the following seven areas: the Permian Basin, Michigan/Indiana/Kentu... Ark-La-Tex, the Midcontinent, the Rockies, Florida, and California.
    Aug 26, 2015. 06:01 PM | 1 Like Like |Link to Comment
  • BreitBurn Energy Partners Maintains Its Distribution - For Now [View article]
    Charles -

    You downside is only about $2.50. There are so very many better places to put your money aside from the E&P's. Look at some of the mid stream NG MLP's for one.
    Aug 26, 2015. 11:51 AM | 1 Like Like |Link to Comment
  • BreitBurn Energy Partners Maintains Its Distribution - For Now [View article]
    I am guessing that BBEP will not be in existence end of 2017. IMO investing (speculating) in any of the E&P MLP's is courting disaster.
    Aug 26, 2015. 11:07 AM | 1 Like Like |Link to Comment
  • Is The Heat Of This Correction Too Much? Get Out Of The Kitchen Or Start Nibbling Now [View article]
    George-

    Yet in prior responses to my comments about getting readers out of these positions you claim that you didn't, and had no responsibility to do so.

    Time will tell if you achieved your goals.
    Aug 24, 2015. 12:52 PM | Likes Like |Link to Comment
  • Is The Heat Of This Correction Too Much? Get Out Of The Kitchen Or Start Nibbling Now [View article]
    While averaging in is usually a good practice, with the volatility shown by the markets over the past three trading days I would refrain from any buying here. It is entirely possible that the averages could drop several thousand points from today's levels.

    The author posited a strategy of buying BBEP, and LINE/LNCO with each new leg down several months ago, and that had to really hurt both him and his followers.
    Aug 24, 2015. 10:05 AM | 11 Likes Like |Link to Comment
  • Exxon Mobil: Why I Am Going To Buy Exxon Mobil Today [View article]
    batast-

    I would certainly wait before committing any funds to anything here. IMO, we are going much lower, and while XOM looks tempting here, it will look a lot better when the yield gets above 5%.
    Aug 24, 2015. 08:49 AM | 11 Likes Like |Link to Comment
  • Using Closed-End Funds To Play The Oil Price Recovery Could Hike Your Profits [View article]
    Harry-

    There's a really good chance that some, or most of their E&P's will bankrupt.

    SRF is a major crap shoot.

    Let us know when you commit your own funds to SRF.
    Aug 21, 2015. 02:40 PM | 3 Likes Like |Link to Comment
  • Using Closed-End Funds To Play The Oil Price Recovery Could Hike Your Profits [View article]
    SRF ?? Their five largest holdings are E&P's.
    Aug 21, 2015. 11:44 AM | 2 Likes Like |Link to Comment
  • Rex Energy Is Going To Be Just Fine [View article]
    Dallas -

    IMO, I think we are going to be closer to the low end of your range - or possibly a bit lower.
    Aug 20, 2015. 04:36 PM | 2 Likes Like |Link to Comment
  • Capital Product Partners: A 13% Yield Growing At 2-3% Annually [View article]
    Darren -

    I get my info from MLPdata.com. Thinking that after today we could be possibly looking at a 20 - 30% drop in the market averages.

    If that happens the MLP's will be much lower.

    Nibbling over time is always a decent strategy.
    Aug 20, 2015. 04:35 PM | 2 Likes Like |Link to Comment
  • Rex Energy Is Going To Be Just Fine [View article]
    Dallas-

    And you will know this how ...
    Aug 20, 2015. 04:32 PM | 1 Like Like |Link to Comment
  • Capital Product Partners: A 13% Yield Growing At 2-3% Annually [View article]
    Darren -

    CPLP's DCF coverage was actually 1.05X in Q2.

    Have been following it for a few weeks now. With today's market debacle I will continue to monitor for a while longer. Buying < $6 would be quite a catch.
    Aug 20, 2015. 04:19 PM | 1 Like Like |Link to Comment
  • Rex Energy Is Going To Be Just Fine [View article]
    When will you be buying?
    Aug 20, 2015. 03:13 PM | 1 Like Like |Link to Comment
  • Memorial Production Partners LP Cuts Distribution 45%. Now What? [View article]
    clrodrick-

    None of them; however, each has increased their distribution every quarter, are fee-based and, more importantly have a stable business model.

    If you think that MEMP is going to continue to yield 20% you better think again. Going forward it will be all they can do to remain in business.

    You have a lot of "ifs" in your last sentence.
    Aug 19, 2015. 10:19 AM | 1 Like Like |Link to Comment
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