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elliot_mllr

elliot_mllr
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  • Linn Energy At $80 Oil [View article]
    I notice that there is no mention of NGLs. NGLs used to trade in line with crude but recently they have traded more in line with natural gas. If the trend reverts to NGLs trading in line with crude, then this will have a further adverse effect on Linn.
    Elliot Miller
    Oct 17 09:42 AM | 1 Like Like |Link to Comment
  • Linn Energy At $80 Oil [View article]
    giofls:
    With respect, I disagree that a cut in distributions will cause the unit prices to "spiral down into oblivion". If Linn cut its distribution by $1 there would undoubtedly be an initial bout of volatility but the unit price would probably settle around $21 (which it approached a few days ago, in the midst of panic selling) for a 9% yield.There are many yield oriented investments that survive dividend or distribution cuts and simply adjust their share price to accommodate the same yield.Annaly would be one, but there are many others. There are some cases where the share or unit price goes up after the dividend or distribution cut because the market then sees the yield as sustainable. At times like these it is best not to deal in hyperbole, since doing so only exacerbates the problem.

    Elliot Miller
    Oct 17 09:00 AM | 14 Likes Like |Link to Comment
  • LINN Energy: Recent Correction Closes Valuation Gap [View article]
    gawilley:
    Also, midstreams with more fixed fee income and minimal commodity exposure will be less sensitive to this volatility.
    Elliot Miller
    Oct 14 04:00 PM | 2 Likes Like |Link to Comment
  • Linn Energy: Portfolio Upgrades Bring A Distribution Increase Closer To Reality [View article]
    Linn has made no secret of the fact that at this juncture reducing debt is a more important priority than distribution increases, and that is a prudent determination.
    Elliot Miller
    Oct 14 03:51 PM | 10 Likes Like |Link to Comment
  • Don't Buy Linn Energy Despite The Price Drop [View article]
    That should be $300-$400 million. I skipped the 4. Sorry.
    Oct 14 11:53 AM | 3 Likes Like |Link to Comment
  • Don't Buy Linn Energy Despite The Price Drop [View article]
    Moreover, nowhere does the author (or even a Commentator favorable to Linn) mention that in addition to dramatically reducing its decline rates and increasing its natural gas production--the newly acquired Hugoton acreage is 65% gas, 35% natural gas liquids-- Linn's recent swaps decreased its capex requirements by $300-$00 million a year.
    Elliot Miller
    Oct 14 11:23 AM | 8 Likes Like |Link to Comment
  • BreitBurn Energy Partners LP: A Closer Look At Assets And Valuation [View article]
    Standing back from the noise, as a QRE unit holder the article makes a compelling case for my standing pat, even though QRE's oily assets have premium value to the pre-merger BBEP assets.
    On another, related point, Linn certainly looks smart in the transactions it has done to significantly reduce decline rates, reduce maintenance capex and reduce its cost of capital. However, Mr. Market has not noticed.
    Elliot Miller
    Oct 10 11:03 AM | 1 Like Like |Link to Comment
  • Oil & Gas Stocks: How Far Are We In This Correction? [View article]
    Fossilfuel:
    That's a cogent analysis.
    In my opinion,one factor not emphasized adequately in articles and comments, is the cost of production. Obviously, the price of WTI, LLS, Brent, etc is an easy headline which makes the news. But the bottom line is also influenced by the cost of production, which varies dramatically from basin to basin. I have seen quotes ranging from $40 to $70, and today's Wall Street Journal cites $53 for the Eagle Ford. Yet commentators make no distinction between those companies operating in low cost and high cost basins. Similarly, no distinction is made between those upstreams with low decline rates (Linn is looking very smart now) and shale plays with serious first and second year decline rates.
    In any event your analysis is incisive.
    Elliot Miller
    Oct 10 10:38 AM | 5 Likes Like |Link to Comment
  • Oil & Gas Stocks: How Far Are We In This Correction? [View article]
    Hssu Shah:
    Most midstream companies have very little unhedged commodity exposure, but that does not immunize them from irrational fear or indiscriminate selling. One differentiating factor should be the basins in which the midstream operates (for example in the Eagle Ford, where the cost of production is only about $53 a barrel there should be little real economic impact) but markets are not reasonable in times like these.
    Elliot Miller
    Oct 10 10:25 AM | 3 Likes Like |Link to Comment
  • Oil Market Karma Reversed? [View article]
    Mr. Kapoor:
    Since they don't ring a bell at the bottom, one cannot time it precisely and must take sensible risks in buying companies that have seem their share or unit prices get slaughtered senselessly, such as upstream companies with full hedge books and midstream companies with little or no unhedged commodity exposure.
    Elliot Miller
    Oct 9 05:42 PM | 3 Likes Like |Link to Comment
  • Update: BreitBurn Energy Partners To Sell 14M Units [View article]
    creese:
    Not only is QRE very strongly hedged, but in addition BBEP is going to increase the distribution to an annual rate of $2.08 after the merger closes. If I did not already have a full position in QRE I would buy some more for the arbitrage described in the article.
    Similar to your reaction, I don't think that it's fair to castigate BBEP management for not predicting the rapid decline in WTI and the slaughter of MLP upstream unit prices in waiting to do the follow on offering. People rush to criticize. I didn't see many congratulatory notes commending BBEP management for its decision to acquire QRE.
    Elliot Miller
    Oct 9 05:32 PM | Likes Like |Link to Comment
  • Oil Market Karma Reversed? [View article]
    Ms. Warren:
    One crucial factor is the cost of extraction in American producing fields. I have seen a wide variety of estimates (depending on whether the field is conventional or shale and other factors) ranging from $40 to $70 a barrel. This missing part of the equation is a crucial element in determining how this entire issue evolves and is determined.
    Elliot Miller
    Oct 9 11:18 AM | 1 Like Like |Link to Comment
  • Really Scared Money: Which Oversold Oil Stock Bargains To Buy Now [View article]
    Income Yield:
    I saw the same news about the Saudis and considered it positive for mid stream companies. Lower prices enhance demand for more crude to be gathered, transported, stored, etc. The universal and indiscriminate sell off of virtually every name in the energy sector is a testament to the shallowness of traders.
    Elliot Miller
    Oct 9 09:53 AM | 1 Like Like |Link to Comment
  • Oil & Gas Stocks: How Far Are We In This Correction? [View article]
    rlp2451:
    While I am not selling either, I'm afraid that your comment about the Saudis was erroneous. Yesterday the Saudis announced that rather than cut production they were reducing prices. Of course, once the price gets close to the marginal cost of production the weaker E & P companies will cut production or maybe go under, but that's not the case with Aramco.
    Elliot Miller
    Oct 8 09:20 PM | 5 Likes Like |Link to Comment
  • Linn Energy LLC: A Look At Its Reshuffled Asset Portfolio [View article]
    Mr. Hoerth:
    Everyone seems to have an obsession with when Linn will increase distributions. It would be far morw sensible for LInn to reduce leverage rather than increase distributions, and that is what it intends to do.
    Elliot Miller
    Oct 8 06:06 PM | 8 Likes Like |Link to Comment
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