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Richard Zeits  

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  • 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
  • Approach Resources: Drilling Suspended, But Challenges Remain [View article]
    Lamanr2,

    First, I don't think that a $30-$40 oil is sustainable for long. Certainly not through the first half of 2016.

    Second, liquidity analysis is a tricky thing and requires some work which I certainly have not done for a flat $30-$40 oil. So I would not be able to tell what the trajectory is going to look like.

    Personally, I think that an oil price normalization will come at some point, and as I wrote in the note above, one should not overlook the fact that AREX has a decent amount of existing production to put up against its bank debt.

    I would wait for the result of the fall borrowing base re-determination.
    Aug 25, 2015. 11:45 AM | Likes Like |Link to Comment
  • Linn Energy - Is A Rebound On The Horizon? [View article]
    jjhappening,

    I don't think of my notes in terms of being "negative" or "positive." I just try to share my two cents on industry trends and how they impact various companies and their competitive positions. I really do not have much emotion in my posts except my admiration for the industry's technical ingenuity, entrepreneurship and perseverance in a very tough competitive environment. I also have a lot of compassion for investors who suffer investment losses.

    With regard to Mr. Dicker, I have not heard of him or read his work, but I am very happy to hear that you found top research that fits your needs.
    Aug 22, 2015. 09:28 PM | 1 Like Like |Link to Comment
  • Linn Energy - Is A Rebound On The Horizon? [View article]
    Hi Clark,

    In my recollection this may be the area where the Woodford is thinner. It also appears to be located updip from the condensate fairway where the bulk of drilling activity is concentrated. The western flank of their acreage block looks interesting, however. In do not have the geologic maps with me (on my computer back in the office), so you may wish to check yourself to make sure my intuition is not off target.
    Aug 22, 2015. 01:21 PM | 1 Like Like |Link to Comment
  • Linn Energy - Is A Rebound On The Horizon? [View article]
    Mp1977,

    I understand you point. I agree with you that selling my beget more selling, as margin accounts are liquidated and hedge funds are forced to exit losing positions for 'risk management.'

    However, I think there are legitimate reasons for concern. While a year ago, when oil was still at $100, the debate was whether the units were worth $35 or $10, right now the debate is whether there is enough value in the assets to support debt (and some may even say, bank debt). This is a qualitatively different type of debate.
    Aug 21, 2015. 11:13 AM | Likes Like |Link to Comment
  • Linn Energy - Is A Rebound On The Horizon? [View article]
    Ttubular,

    I think Raw Energy's comment up above on this topic is very relevant.
    Aug 21, 2015. 10:54 AM | 1 Like Like |Link to Comment
  • Linn Energy - Is A Rebound On The Horizon? [View article]
    Giofls,

    I don't believe interest is the issue - the company has ample revenue protected by hedges through year-end 2017. Should be more than enough to cover interest.

    The real concern is in potentially more stringent price deck that banks may apply in the next re-determinations. If the borrowing base falls below current amount outstanding, LINN may have to cut all of its other spending (such as bond buybacks and capex) to repay the portion of debt that exceeds the borrowing base. I am not convinced something like that will necessarily occur in the next re-determination.
    Aug 21, 2015. 10:40 AM | Likes Like |Link to Comment
  • Linn Energy - Is A Rebound On The Horizon? [View article]
    mp1977,

    -- "It's way too early to panic, but that hasn't stopped everyone from doing so."

    An interesting thought, given that the units are at $2.48, after trading just under $40 as recently as 2.5 years ago. Really, still too early to panic?
    Aug 21, 2015. 10:34 AM | Likes Like |Link to Comment
COMMENTS STATS
2,130 Comments
3,086 Likes