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  • Bakken Update: EOG Antelope Well Has One-Year Payback At $50/Bbl WTI [View article]
    Lul:

    Someone mentioned QEP to me in the Bakken.

    They closed on the midstream asset sale. They paid down the bank debt.

    They are still sitting with all the term debt, but have large cash assets on the books plus the full availability of the bank lines.

    They are reasonably valued, operating in the Bakken. They do not have a lot of hedges in place, but the rest of the operations and financials look pretty clean.

    They are in Fort Berthold Res and South Antelope. What do you say?

    Those are supposed to be pretty good acres.

    Mike F, want to chime in? Any thoughts on QEP?

    Seems that possibly their well results are a bit behind EOG and HK given their locations? Perhaps they have not gone to more expensive completions as much with the larger sand, more fracc stages etc.
    I can only guess. I have no hard numbers.
    Dec 14, 2014. 10:16 PM | 1 Like Like |Link to Comment
  • Recent Asset Sale Metrics Point To 300% Upside For Lightstream Resources [View article]
    Jack20: If the rig count is falling then production can't be far behind.

    People do not rationally take into account that all the growth in North America production has been relatively high cost oil sands and unconventional. Oil sands has high up front longer lead time fixed costs and very high operating costs. Unconventional is Not at all the same.

    High short term fixed costs and very low operating costs. Spud to sales 45-60 days in a developed play if the fracc crews are ready. What is a whole pad to develop? 90-150 days?

    If unconventional drills ahead of cash flow and utilizes the bank lines, and you have 60-70% first year declines, and then you cut cash flow by 30-60% and now suddenlty everyone is bumping up against the debt/EBITDA covenants on their bank lines.................you should get a fairly swift
    decline in drilling and production from the unconventional.

    I still think there is a decent chance Syncrude goes off line if we hit $50 and hold at or below this level for a few months or quarters.
    Dec 14, 2014. 09:54 PM | 1 Like Like |Link to Comment
  • Recent Asset Sale Metrics Point To 300% Upside For Lightstream Resources [View article]
    Jack20:

    Thanks for the kudos. Do you think that Syncrude with operating costs almost
    $50 not counting maintenance Cap-ex would actually shut in about 300K Boe/day
    anytime soon.

    COS has their only operating assets is part of this JV. They have a fair amount of debt on the books. They reduced the 1Q January div by 1/2. IMO if prices are still down here in 1Q they eliminate the 2Q div.

    But would they actually take it off-line?
    Dec 13, 2014. 06:36 PM | 1 Like Like |Link to Comment
  • Atlas Energy: A Mispriced Equity That Is A Unique Value Play [View article]
    Dan R:

    Good article and Thanks for the info on the break fees.

    On a different subject, any thoughts about immune therapy companies for cancer in the bio tech space?
    Dec 13, 2014. 06:16 PM | Likes Like |Link to Comment
  • Penn West: The Dividend Needs To Go [View article]
    I think you will find PWT has a lot of land in inventory, but Duvernay has a wide range of prices per acre from $1K to $10K per acre. I would have no solid idea of what PWE's Duvernay is worth, but land is like buying futures, and future drilling locations do not have as much value when current locations that were economic at $90 are no longer economic to drill at $59.
    Dec 13, 2014. 03:31 PM | 1 Like Like |Link to Comment
  • Recent Asset Sale Metrics Point To 300% Upside For Lightstream Resources [View article]
    IMO at sub $60 LTS and PWE have to cut the divie to ZERO to preserve remaining cash flows for debt interest, debt principal, and maintainence cap ex, in that particular order.

    In Canada if have seen a lot of forbearance by the banks for their E&P loans, where they let them live as long as operating cash flow is used to pay interest and reduce principal.
    Dec 12, 2014. 03:49 PM | 1 Like Like |Link to Comment
  • Atlas Energy: A Mispriced Equity That Is A Unique Value Play [View article]
    Dan R:

    What are the "break fees" to either side if the deal is not completed?
    And what are the terms of the break fees?

    Sometimes these deals get written without the ability to break the deal unless
    the seller entities get a better offer and the BOD in exercise of it's fiduciary duty
    has to break the deal. In that case the seller pays the termination fee.

    For the buyer, they may have a condition of "specific performance" in that they can't break the deal.
    Dec 11, 2014. 09:42 AM | Likes Like |Link to Comment
  • Update: BP Gets Its Final Supreme Legal Beat Down - Game Over [View article]
    Aren't they doing that in Alabama and Miss too!

    I know they have been running ads on the TV stations along the Gulf Coast of Florida trolling for claimaints.
    Dec 10, 2014. 11:23 AM | 2 Likes Like |Link to Comment
  • Penn West: The Dividend Needs To Go [View article]
    How about some comments or analysis about why their operating costs are so high in the Cardium and Viking, two of their major production areas.

    If you comp PennWest to some peers in these two plays, their operating costs per BOE look near horrible. Why per BOE production costs so high?

    I assume it is a lot of older low volume 10-20 Boe/day wells in these two plays.
    Dec 10, 2014. 10:31 AM | 1 Like Like |Link to Comment
  • Penn West Is Undervalued Compared To Pengrowth, Enerplus And Baytex [View article]
    Jim:

    When you do your article on PWE can you dig into from the company IR just why their operating costs are so high?

    I have to assume it is from a large number of very very mature wells in their Cardium and Viking plays that are on very very low production. Otherwise, when you compare it to some peers in these two main production plays, on production costs, I begin to hear a giant sucking sound.

    PWE and LTS are leveraged bets, for sure.
    Dec 9, 2014. 08:34 AM | 1 Like Like |Link to Comment
  • Saudi Arabia: Do The Math [View article]
    Bachar:

    Good points. I agree. It's not about U.S. shale and marginal producers, including some Canadian Oil Sands and some Off shore projects, thought they will be effected at $65 oil, and their may be some casualties here.

    Mike wrote a very good article. The case study says it's not about market share and elasticity of demand. It's not a business school case. B school says you cut production the 600K Barrels a day and continue on.

    It IS about using oil as a political and economic weapon in a war against adversaries.

    Seems to me Putin was on the hot seat this past week. He reminds me of Sadam going into Kuwait. Putin has overplayed his hand here. Seems to be back pedaling a bit now. The ruble and the economy are going down the tubes. Assuming he is the ringleader or the front man for all the Russian former KGB and oligarcs, he may be on his way out if this takeover fails. Kerry meets with their Foreign Minister next week. Sounded to me like Crimea is NOT a bargaining chip for Russia, they want to keep it. Maybe everything else is on the table.

    My thought had been when Russia entered Ukraine why don't we treat him like Saddam or Bin Laden as a "terrorist" and just take him and his top 10 generals out with a drone strike when they were gathering at the border in the earlier days to "plan strategy".

    I mean, this is a guy who has had a lot of journalists and political adversaries over the years killed or thrown in jail. It is NOT a real democratic election system in Russia anyway. I can't imagine too many in Russia would really miss him. And it would save a lot of time and money and lives to the rest of the world to not have dragged this all out the way it has gone so far.

    And, Russia would hold new elections and the message might get heard loud and clear to the remaining former totalitarian punks about what the rest of the world expects for military and political behavior.
    Dec 6, 2014. 08:01 AM | 2 Likes Like |Link to Comment
  • I Will Definitely Cheat On Storm Resources With Its Natural Gas Weighted Peers [View article]
    IMO Canada is going to have to feel a little more "pain" like the Russians are currently before they get serious about taxes, regulations, and construction costs (labor market loosening) to get a few of these 12 proposed pipeline/LNG deals through.

    Eventually IMO a few will happen, necessity being the mother of "political" invention.

    The BC government in power now wanted LNG export as a "cleaner" strategy than oil sands development and oil pipes to the coast. They are going to have to bring some of the radical lefties in line if they want jobs and tax revenue.

    Socialist policies can only survive if their is wealth and capital to tax and transfer.

    I think they (the pols) will figure it out sooner or later.
    Dec 5, 2014. 09:12 AM | Likes Like |Link to Comment
  • Cimarex Energy: Attractive At Current Levels [View article]
    Bought some yesterday based on the company 3Q results and presentation.

    Their Delaware acres are getting better and better. Drilling Costs down and
    recoveries up.

    They only negative I found was no hedges in place to speak of.
    Dec 5, 2014. 08:28 AM | Likes Like |Link to Comment
  • Bakken Update: Halcon May Struggle To Find Economic Wells In 2015 [View article]
    I did not sell mine as "expiry" does not start till 2016. 2015 hedge book looks pretty good, and debt is not due to be rolled, refinanced, or restructured in 2015 either.
    Dec 5, 2014. 08:11 AM | 2 Likes Like |Link to Comment
  • Is Laredo Petroleum Worth Accumulating At These Levels? [View article]
    glennoe:

    A few questions about this Cypher process. Is it "science" to the extent that they can look at the seismic, logs, mud, cores etc and tell the operator exactly what level to drill at, which direction to drill, toe up or down, and how to complete the well............ie....... complete 3D model of the rocks that takes into account all known variables, or is it still more operational and statistical dependent in that you have to drill and drill again and feed in more data as you go and then the "science" does an optimization of the results so there is still a "learning" curve?

    With regard to Garden City I have a comment. They may have very good acres there but I see a lot of "sweet spots" in the Midland Basin all over the place.

    Take ATHL results up in Howard County "TUBB" verticles and H wells, for example. There are a lot of very good well results all over the MIdland Core as Parsley calls it.

    In the Delaware I see the same thing. Lots of good or very good results turning up all over the place. So the sweet spots in these two Basins look quite huge.
    To very big gardens to harvest.

    Since the commodity price is non-differential in the Perm, and I don't see that much difference in the rocks from place to place, the differentiating factors become the drilling costs, drill results, and operating costs which are all operator dependent. So if Laredo can't cut the mustard and be competitive on the numbers that they can control, then they should cash it in for the highest bid and turn it over to a better operator.....cash or stock or a combo, I don't care.
    Dec 5, 2014. 08:04 AM | Likes Like |Link to Comment
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