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Josh Young  

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  • Athlon Deal Highlights Exxon Permian Steal [View article]
    RLP, if Encana didn't get 140,000 mostly undeveloped net Wolfcamp acres, that would be right. However, because Encana bought both undeveloped land and production, it is more accurate to evaluate the production value and the acreage value separately, which is what I did in the article.
    Sep 29, 2014. 02:58 PM | Likes Like |Link to Comment
  • Athlon Deal Highlights Exxon Permian Steal [View article]
    Thats right, but there is some value for acreage and some value for production. So its not $7.1 billion divided by each, its closer to $2 billion divided by 30,000 barrels per day and $5.1 billion divided by 140,000 acres.
    Sep 29, 2014. 01:15 PM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    Thanks for the comment
    Sep 24, 2014. 10:54 AM | 1 Like Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    Comps from the past 18 months, not 18 months old. Given the very limited information provided by the company regarding this transaction, comps are a good reference point. Particularly because so many other transactions have been in line with the other comparable transactions.

    Re: my clients,
    a) I don't use seekingalpha to make buy or sell recommendations
    b) incidentally I don't own, nor recommend, nor am I short (nor do I recommend shorting) LINE at the moment. I reserve the right to change that at any point without further notice.
    Sep 24, 2014. 10:52 AM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    Linn's engineers certainly have more information about the assets they are buying and selling than I do. However, management did not share some of the information they could have to help the public better assess a transaction. The information they chose to share does not make a great case for the transaction.
    Sep 24, 2014. 10:47 AM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    The decline rate and reserve life are incorporated into the variance in production valuation metrics.
    Sep 24, 2014. 10:41 AM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    I believe I have said both in the article and in comments that the Permian valuation is based on comps and that California valuation is based on comps plus some credit for upside development potential and reserves.
    Sep 21, 2014. 01:23 PM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    RLP,

    If you use the metrics you cite for Antares, it appears LINE overpaid by 42% instead of 55% - still a lot. I based my Permian valuation estimates off of numerous investment bank analyst reports that have come out in the aftermath of the numerous Permian transactions. But either way you cut it, LINE overpaid by quite a bit.


    Permian Asset California Asset
    Production 4,700 3,400
    Value Per BOEPD $120,000 $150,000
    Net Production Value $564,000,000 $510,000,000

    Acreage 17,000 Included
    Value Per Net Acre $9,300 Included
    Net Acreage Value $158,100,000 Included

    Combined Value $722,100,000 $510,000,000
    Difference $212,100,000
    Percentage Difference 42%

    Implied CA $/BOEPD $212,382
    Sep 21, 2014. 01:22 PM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    Resale value, based on recent lease sales in the past 18 months.
    Sep 20, 2014. 02:55 AM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    Generous omission. Unclear where the acreage is. Its possible that acreage might also be highly valuable.

    Unclear re: California drilling locations.
    Sep 20, 2014. 02:49 AM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    I invest in very undervalued stocks and short very overvalued stocks.

    It is possible for an article to be neither a "long" nor a "short" recommendation.

    It is interesting so many people are so bothered by a simple, accurate, objective analysis of a multi-hundred million dollar transaction.
    Sep 19, 2014. 06:08 PM | 3 Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    Incidentally, companies in the area and research analysts covering them are estimating DCF value per acre in the core Midland Permian of over $100,000 per acre. (and some estimates are twice that!) If they're close to being right, this deal is even more one sided than my analysis suggests.
    Sep 19, 2014. 05:56 PM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    The relative decline rate is incorporated in the values assigned for the respective production.

    There isn't nearly enough information provided by the companies to build a 10 year dcf. But you can look at recent transaction comps and figure out how what was purchased compares to those transactions. Which is what I did.
    Sep 19, 2014. 05:52 PM | 1 Like Like |Link to Comment
  • Linn Energy: Why The Asset Swap With ExxonMobil Makes A Lot Of Sense [View article]
    Caper, along these lines I wrote an article that analyzes some of the quantitative aspects of this deal and comes to a different conclusion:

    http://seekingalpha.co...
    Sep 19, 2014. 05:45 PM | Likes Like |Link to Comment
  • Linn Energy Overpaid For Exxon's California Production [View article]
    Please be more specific regarding "errors in the Author's analysis".

    I'm happy to make changes if there is an error.
    Sep 19, 2014. 05:38 PM | Likes Like |Link to Comment
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