Seeking Alpha
View as an RSS Feed

Richard Zeits  

View Richard Zeits' Comments BY TICKER:
Latest  |  Highest rated
  • Halcón Resources Sets Precedent For Debt Restructurings In The U.S. Oil And Gas Sector [View article]
    Hi Joe Kelly,

    I actually mean every word in the disclaimer and consider it important.

    Glad you found the article worth reading.
    Aug 31, 2015. 05:55 PM | Likes Like |Link to Comment
  • PDC Energy: More Resilient Than Exxon, And For A Good Reason [View article]
    Hi Send In The Clowns,

    I agree, environmental issues are a concern in Colorado. However, some compromises have been already reached, so the business environment that we are seeing right now to some degree reflects the debate that took place two years ago.

    The debate is never over, of course.

    With regard to XOM, I am not sure if all the 1.5 million acres are in prospective areas. Otherwise XOM would not be trading for undeveloped acreage with folks like LINN.
    Aug 31, 2015. 01:26 PM | Likes Like |Link to Comment
  • Encana: Vast Asset Portfolio Is A Source Of Funds, But Divestiture Proceeds May Disappoint [View article]
    Hat_trick3,

    Under U.S. GAAP, E&P companies are subject to periodic asset appraisal tests that often find reflection in non-cash write-downs when commodity prices fall. Raw Energy has covered the topic quite extensively i believe, you may wish to have a look at his articles.

    But let me ask you this: do you think that the market will react in any way if an operator, such as Encana, announced an impairment charge? Wouldn't it be old news, given that everyone has a oil futures curve on their screens?
    Aug 31, 2015. 11:16 AM | Likes Like |Link to Comment
  • Bakken: Defying Oil Price Gravity [View article]
    Bituman1958,

    I understand the method you are using, but I really think one needs to go by monthly completions data or make sure that you have "scrubbed" the data for total wells.
    Aug 31, 2015. 09:10 AM | Likes Like |Link to Comment
  • Encana: Vast Asset Portfolio Is A Source Of Funds, But Divestiture Proceeds May Disappoint [View article]
    Nutjob,

    I think there is a difference.

    Forest's problem was in their inability to secure a position in the Core or Tier 1 of the plays they were trying to re-position to. If you remember, in the Eagle Ford they had a large block but over time it became clear that it was in the "dead oil" window where reservoir energy was low and production declines were very steep.

    In the Wolfcamp, their acreage was far outside the core fareway.

    In the Granite Wash... well, Granite Wash is Granite Wash.

    My feeling is that Forest was too obsessed with trying to "cost cut" itself out of its problems (the biggest of which was lack of prospects that could compete for capital in the new environment) and as a result completely missed the mark on vision and on geology.

    Encana is quite different, in my view. They have several opportunities in their portfolio that appear competitive (as long as the entire U.S. shale industry can be viable). Legacy assets may have substantial value. The problem is that the portfolio is too large relative to cash flow and leverage.
    Aug 31, 2015. 08:22 AM | Likes Like |Link to Comment
  • Bakken: Defying Oil Price Gravity [View article]
    Hi Bituman1958,

    Thank you for reading.

    "There is not a snowballs chance in hell that production will increase in the Bakken this year."

    It is obviously a function of oil prices. With WTI below $40 a week ago, I actually agree, operators a probably tightening their spending and deferring production as we speak.

    With regard to your 200 well estimate to keep Bakken production flat, I am afraid it is off, and by a very wide margin. Just to make sure we compare apples to apples, my estimates refer to production from the Bakken System and new horizontal wells.
    Aug 31, 2015. 08:09 AM | Likes Like |Link to Comment
  • Encana: Vast Asset Portfolio Is A Source Of Funds, But Divestiture Proceeds May Disappoint [View article]
    Pablomike,

    It looks like it was meant to support growth.
    Aug 27, 2015. 05:09 PM | Likes Like |Link to Comment
  • Encana: Vast Asset Portfolio Is A Source Of Funds, But Divestiture Proceeds May Disappoint [View article]
    Pablomike,

    I would think of it in terms of firm value, so the sale price is about 8% of FV. The cash flow is obviously deeply depressed by the capacity charge on a giant unused takeaway commitment through 2020. So the 2.5% metric does not tell the entire story.
    Aug 27, 2015. 09:13 AM | Likes Like |Link to Comment
  • Bonanza Creek Energy: What Happens After The 90% Stock Price Decline? [View article]
    Futurenhldad,

    I would not be able to tell. For every seller, including a short seller, there is obviously a buyer.
    Aug 26, 2015. 11:06 AM | Likes Like |Link to Comment
  • Bonanza Creek Energy: What Happens After The 90% Stock Price Decline? [View article]
    Hi Pablomike,

    I am overdue with an update on BBG. Hope to post soon.
    Aug 26, 2015. 09:49 AM | Likes Like |Link to Comment
  • Bonanza Creek Energy: What Happens After The 90% Stock Price Decline? [View article]
    RG3015,

    My focus was more on the asset performance and stock performance. Just to make sure, it appears BCEI is a well managed operation. I just need to get convinced what oil price may be required for production to grow organically at acceptable rate.

    You may wish to have a look at my recent note on PDCE.
    Aug 25, 2015. 09:20 PM | Likes Like |Link to Comment
  • Chesapeake Granite Wash Trust: Stress-Testing At $50 Per Barrel [View article]
    Hi Mark,

    Still have not had a chance to write an update, my apologies. A very busy market indeed.
    Aug 25, 2015. 09:08 PM | Likes Like |Link to Comment
  • Bonanza Creek Energy: What Happens After The 90% Stock Price Decline? [View article]
    Hi Gordon,

    I think it depends on your view on commodity prices. Personally, I think a cyclical turnaround will be coming at some point and the world will look differently then. There are variables, of course: how soon? how strong of a recovery?
    Aug 25, 2015. 02:53 PM | Likes Like |Link to Comment
  • Approach Resources: Drilling Suspended, But Challenges Remain [View article]
    Chief Illiniwek,

    I agree with you, the company is doing a right thing by suspending investment and waiting for a cyclical upturn.
    Aug 25, 2015. 12:30 PM | Likes Like |Link to Comment
  • Approach Resources: Drilling Suspended, But Challenges Remain [View article]
    Hi Wilco68,

    I agree with you, AREX's cost structure does not look too bad for a small company.

    The main issue, as I wrote, appears to be well productivity. The company's asset may work very well at relatively high commodity prices but I wonder if the company will be able to make it work at low prices. Geology is sometimes the limit that even the smartest operator cannot fight against.

    I would add that AREX is not the only good operator struggling with the macro environment.
    Aug 25, 2015. 11:47 AM | Likes Like |Link to Comment
COMMENTS STATS
2,137 Comments
3,086 Likes