Mmarrkk

Total Rating:
+3 / -2

257 Comments

    • Mon Oct 13th 14:33 PM | Rating: 0 0
      Commented on:
      Chesapeake Bites McLendon
      Sooner: big difference...Enron had no real assets. CHK has a large amount of real assets, producing wells, reserves, undrilled acreage, etc. that many companies would love to buy from them. Also, if CHK stops drilling they have a very attractive cashflow situation. Their big problem is their drilling expenditures are outpacing their revenue. That is easily fixed. Unless someone comes in and buys them.

      CHK is no Enron by a long shot!
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    • Mon Oct 13th 09:30 AM | Rating: 0 0
      Commented on:
      Oil Industry: Farewell, Good Old Days
      valueinvestor123: you are correct. The original author was partially correct in his article that CHK and others are having cashflow problems but they are most certainly not out of cash. What they are is outspending their cash. That is a huge difference from being out of cash.

      What can CHK do to avoid catastrophe? It is really very simple and its like what a huge number of U.S. consumers should do...STOP SPENDING MORE THAN YOU MAKE!!!! CHK was spending well north of 150% of its cashflow on drilling and leasing. Now all they have to do is cut back spending to where it is less than their cashflow and debt repayment. If they stopped drilling completely, which I don't think they should do, but if they stopped completely, they have more than enough cashflow to cover their debt payments, their ongoing overhead and operationse expenses and still have cash left over to put in the bank. Now what they should do is just continue to slow down their spending over the next 2 quarters. Possibly sell some assets, although this is a horrible time to sell. Maybe they can work a deal with some of the deep pocket cash hoarding major O&G's like Exxon or Chevron. They could get some cash either infused or they could get someone to pay for their drilling.

      Remember, they have 2 deals with PXP and BP where those companies will be covering virtually all of their drilling expenses over the next year in the Fayetteville and Haynesville shale plays...2 of CHK's better plays. They may not be able to get that much leverage now a days, but they have really nice assets...undrilled acreage in key plays...and majors are looking for growth.

      My prediction: as a shareholder in CHK I think these shares will at least double over the next 12 months OR CHK is bought out by one of the big guys! either way, if you've got a few years, this will be a good play.
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    • Thu Oct 9th 10:06 AM | Rating: 0 0
      Commented on:
      MLPs Still Attractive After Recent Selloff
      For safety, stick with the midstream MLP's that basically don't rely on gas prices. They get paid a fee for moving gas, in most cases. In some cases they get paid a percentage of what they move, which would make them sensitive to gas prices. Enterprise is a good one.

      Also like LINE and LGCY, former being "gassy" and the latter being "oily". paying in the 15-20% range. LGCY is very conservative and doesn't take a leveraged extra "cut" like Kinder does. The guy running it is "good people", principled kind of guy from Midland TX. Not a slickster like others.
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    • Mon Oct 6th 09:17 AM | Rating: 0 0
      Commented on:
      Good COP: Conoco Touts Better Batteries, Cleaner Coal
      good catch Jack. Except I'd add "+/-" to your 1000 btu/CF. We produce lots of gas in the 1200 btu/CF and some in the 950 btu/CF range. With the 1200 gas, with proper processing, we get it down to about 1075 or so plus some very nice liquids to sell!

      Fortunately we sell gas at a $/btu pricing point, not a $/CF pricing so we get the benefit (or hit) for variations in content. For the coal-to-gas projects, that is an adjustment which impacts its comptetiveness with natural gas.
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    • Fri Sep 19th 10:15 AM | Rating: 0 0
      Commented on:
      Fort Hills Project - Another Debacle for Teck Cominco
      Perhaps this shouldn't be a "comment" on an article...but an actual published article!! This is good stuff! John Walker has been warning folks for a long time about the MLP craze. MLP's have their place and when properly pulled together and structured, are good vehicles. But this isn't a one-size-fits-all solution. Or put another way, when the only tool you have is a hammer, everything looks like a nail!

      Drill here, drill there, drill now, drill tomorrow!! And nuke it, blow it, recycle it, battery control it...it all needs to be done!!! And, while we are at it, why not start using CNG for cars/trucks and converting some of our vast coal resources into liquids using CTL technology. Again, no silver bullet but an all-encompassing multi-pronged approach in the short term with a longer term view/solution in mind as well!
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    • Fri Sep 19th 10:07 AM | Rating: 0 0
      Commented on:
      Constellation Energy's Stars Align for Buffett
      Well done Mr Buffett. To the employees of CEG, you are really very lucky to have been rescued by this White Knight, although it may not seem that way right now. But this beats the heck out of receivership! To the stockholders of CEG, my condolescences. You took a pretty good whipping! But hopefully some folks will learn some valuable lessons: 1) research the companies you own and check their balance sheets for leverage. Leverage can be enticing, exciting but also excruciating! 2) I'm sure the guys running CEG will probably get some multi-million dollar bonus or buy out. When will we as shareholders ever learn? These guys should get nothing but a swift kick but instead they get millions. Just like the boards of Fannie/Freddie who last year got huge bonuses.

      I hate, no, I detest government regulation but maybe we should have something that forces the compensation committees of these Boards of Directors to be truly independent and shareholder focused. I don't want gov't telling us how much we can pay CEO's, but I'd like the BofD's to self-regulate. But to do that we must end the croneyism. Maybe the middle ground is that the compensation committee make-up can be regulated...and include everyday shareholders and/or employees! No union boss thugs, but plain, everyday employees from the bottom-third of the payroll.
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    • Sat Sep 6th 17:25 PM | Rating: 0 0
      Commented on:
      Oil: The Inconvenient Truth
      Why was Hitler a problem?


      On Sep 05 05:28 PM henarl wrote:

      > Fitz: It appears that you are a Bush hater and an oBAMA fan. I agree
      > on Bush and think he will probably go down in history as one of our
      > very worst Presidents. The Iraq quagmire is inexcusable and jingoistic
      > empire building is counter productive in the modern world. That said
      > however, I doubt that oBAMA would be much better. Rather than wasting
      > our wealth on a stupid fascist foreign policy to support the military-industrial
      > complex he will waste it on equally stupid socialistic programs to
      > support a bloated bureaucracy and a dependant under class.
      > Either way, these firmly entrenched special interests and their lobbies
      > will prevent any meaningful change in the status quo until we have
      > a dire emergency. Too bad that Ron Paul is not really a viable alternative.
      >
      >
      > Mmarrkk: Why was Saddam, or any other ruthless dictator in some third
      > world country, our problem. If we had just continued to buy Iraq's
      > oil it certainly would have cost us much less than the cost of our
      > current adventure there, both in dollars and lives. As to the two
      > "Is" nuclear threat to the U.S., do you really believe that we were
      > in serious danger of a nuclear attack from either of them ? Com'on,
      > just more Bushie BS. And........ no, unfortunately we cant just all
      > get along. Just look at human history.
      View article »
    • Fri Sep 5th 17:10 PM | Rating: 0 0
      Commented on:
      Why Buy MLPs?
      I know some guys that tried that death approach...IRS still got their pound of flesh!! If you can time your death just right and hit it when the death tax is low, you'll be okay but its pretty tricky!!! Good way to end a week! Beer Thirty!
      View article »
    • Fri Sep 5th 15:51 PM | Rating: 0 0
      Commented on:
      Oil: The Inconvenient Truth
      Fitz: the reason the market hasn't fixed our 70% dependency is a) this is a global market and b) we haven't given the market a chance. We are still resticting the drilling of wells within US boundaries/territorria... waters. Had we been able to drill, I doubt we'd be at 70%, but item (a) would still hit us.

      Not being in Iraq would be good, but the Iraqi people would still live under a repressive dictator who slaughtered hundreds of thousands of people. At least he's gone. And, he would still be trying to import what's needed for nuke's. Then we'd have the two "I" countries vying for nukes. Again, a less than perfect solution I agree. But taking that logic further, we would never have gone to war against Hitler either, but I guess that wasn't a good idea either. i don't know. At some point, Saddam needed to be taken out, just like his 'brother' in Persia. But we probably have bigger fish to fry, like our 'buddies' in Russia. Can't we just all get along!!

      Its Friday, power is still out in over 50% of the folks homes in South Louisiana, and no one knows about it because it didn't happen in New Orleans! What a shame. Time to get on the road and go help clean up. Have a great weekend and we'll be back at it on Monday! Sorry about dissing Cali earlier, but I still don't like the mindset there and the majority of the politicians. Let me spud a well off the coast, and we can talk! Drill here, drill now!!!!
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    • Fri Sep 5th 15:40 PM | Rating: 0 0
      Commented on:
      Why Buy MLPs?
      rdp1: here's an idea to eliminate that nasty little problem when your cost basis goes to zero:

      donate the shares you currently own to a charitable organization certified by the IRS. You will get to claim a tax deduction for the entire amount. Then, turn around and buy the same number of shares in your account. That will "reset" your cost basis to whatever you pay for the new shares. All of this assumes you donate money of that quantity to charity anyway. I do this every year. Instead of donating $15,000 to my church, I donate $15,000 worth of stocks that have very low cost basis/very high taxable gains. Then I buy the shares on the market. Its a win-win for everyone...except the tax man who gets way too much of my money anyway!!
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    • Fri Sep 5th 15:36 PM | Rating: 0 0
      Commented on:
      Why Buy MLPs?
      rdp1: I'm pretty sure that's right. check with someone who knows taxes but I believe you will owe taxes on the "return of capital" portion of the dividend payment, not the whole thing.
      View article »
    • Fri Sep 5th 09:36 AM | Rating: 0 0
      Commented on:
      New Gas Discoveries a Boon for U.S. Energy Sector
      Bricki: I believe if you will check Sarah's record, she is for teaching both the hypothesis of evolution and the alternative hypothesis of creation. Are evolutionists scared of an alternative?

      And, the beloved ms. Pelosi seems to not understand that natural gas is a fossil fuel! So I guess I might agree that science education is in need of repair. Pelosi obviously needs a refresher! And while we are at it, maybe the evolutionists should go back and learn a bit more about the scientific method. They violate it quite regularly when working through their theory...that is when they aren't fabricating evidence!


      On Aug 30 07:43 PM otbricki wrote:

      > Mmarrkk, the Republicans have just chosen for their Vice Presidential
      > candidate a Creationist who wants that drivel taught in schools.
      > I would be she has some rather amazing things to say about fossil
      > fuels as well.
      >
      > Science education in the United States is a complete and utter disaster.
      > And it is the fault of both parties.
      View article »
    • Fri Sep 5th 09:17 AM | Rating: 0 0
      Commented on:
      SEC's New Plan Could Revamp Oil and Gas Reporting Rules
      Gorilla: actually its a way to drag the SEC into the current century. The article did a horrendous job of explaining the "booking" of unconventional resources in that it makes it sound like unconventional resources aren't booked today. Some of them are, there is just a very tight restriction of what can and can't be included. For instance, in the Barnett Shale, it is geologically proven that the shale stretches out across a very large area. But, companies can only book reserves for wells drilled and then one spacing unit around that well. But the resource is located all around it. The new rules will allow the recognition of the additional resource, but place it in a category that denotes that it must be drilled/developed before it makes it to the "Proved Developed" category.

      Also, the author (and or Mr. McMahon who he quotes) made a catastrophic mistake toward the end. BG did not buy "a 25% stake in CHK" and "in the Fayetteville". BP, not BG, bought a 25% stake in the Fayetteville Shale holdings of CHK. That's a far cry from buying a 25% stake in the entire company and he got the companies wrong. Kind of makes you wonder if you really should take stock advice from someone who can make this sort of mistake!
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    • Thu Sep 4th 09:11 AM | Rating: 0 0
      Commented on:
      British Petroleum Moves into Arkansas with Chesapeake Energy Shale Purchase
      AEB: shale gas makes lots of sense (and cents!) at far less than $9/mmBTU. In fact, I'd say certain areas make sense at $5 (some Barnett and the Fayetteville) and others make sense at $7 (rest of Barnett, Haynesville, some Marcellus and several others that are not being hyped in the media...they are "tight" and won't be PR'd for a while).

      Why is CHK selling "everything in sight?"? If you'd look you'd see they aren't selling everything. In many of their best plays, they are selling 25%, plus getting someone to pay for drilling costs on teh other 75%! The reason they have to do this is that they have gone out and 'captured' a huge amount of mineral leases over hundreds of thousands of acres. These leases are generally 3 year leases with 2 year extension options so all of this land has to be drilled in 5 years or less. To do this would take unbelievable amounts of capital. CHK could either borrow the money which really isn't a great option giving theri current debt, or sell PARTS of them and get someone else to pay for huge portions of the costs. Its called LEVERAGE and Aubrey's got a ton of it!!

      CHK has forward sold a large portion of its gas at prices well north of even your supposed $9 minimum price and has floors in place for a good portion of the rest. So they have eliminated a big chunk of the price risk. They went out and bought drilling rigs when they were cheap so they partially took out the cost inflation risk, although there's still a sizeable risk for that.

      BP is a company run by some very smart financial minds...maybe not operations, but they know finances. For them to make this investment, I can guarantee you the numbers work, even with the leverage they had to give up to CHK.
      View article »
    • Wed Sep 3rd 13:59 PM | Rating: 0 0
      Commented on:
      Oil: The Inconvenient Truth
      polar ice caps melt and they freeze and expand. saltwater beaches in Harrisburg PA, why not? There used to be glacial ice sitting in Arizona didn;t there? This little planet is constantly changing...climate will always be changing. What's the big deal? As the water comes up, people will need to move. Again, its not like the water is going to rise 2 feet in one day! We just need to get smarter and stop living on beaches as today's beach could be tomorrow's (generationally speaking) offshore land! Or, an hour's drive to the water.

      Now, all that said, yes lets do things cleaner. Lets use more clean burning nat gas, clean coal technology, nukes, etc. Wind too. Okay Teddy, can we please put a wind turbine up near your house?? Lets just not get frantic and collapse our economy over it. I'd rather they fix Social Security first, than deal with the climate change as an emergency. OF course, any mention of doing that is met with screaming and gnashing of teeth.
      View article »
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