Energy XXI - A Gulf Of Mexico Disaster? Or The Next Great Gulf Turnaround Story?

Dallas Salazar profile picture
Dallas Salazar
5.23K Followers

Summary

  • As Energy XXI has become more and more stressed the story has has become more and more interesting/binary.
  • We believe we have a comprehensive, multi-layered roadmap for evaluating Energy XXI’s health and its viability.
  • We express our beliefs and open our roadmap for public viewing in the slides below.
  • We summarize the real-time narrative as of the most recent close, and we present both the current risk picture as well as a dynamic roadmap for tracking structural stress.
  • The hope for those still long this name is that the E&P can continue to successfully destress. But can it?

We recently took on the contract responsibility of consulting a mid-size ownership group of Energy XXI (EXXI) shareholders. As Energy XXI has become more and more stressed -- with the majority of its stress being put on its model over the last 12-15 months -- the story has become more and more interesting/binary. I'm really looking forward to watching the Energy XXI story develop and to stress-testing our own risk management roadmap.

We believe we have a comprehensive, multi-layered roadmap for evaluating Energy XXI's health and its viability. We express our beliefs and open our roadmap for public viewing in the slides below. We believe that we summarize the real-time narrative as of the most recent close and that we present both the current risk picture as well as a dynamic roadmap for tracking overall structural stress levels at the E&P. Energy XXI, over the last 12 months or so, has done an excellent job in making progress into what would have been our recommendations for destressing its model. The hope for those still long this name is that the E&P can continue to successfully destress. But can it?

We answer this question in the following screencast; enjoy.

This article was written by

Dallas Salazar profile picture
5.23K Followers
Dallas Salazar is the CEO an Austin-based consulting firm that specializes in private company lifecycle management, up to and including taking companies public, and in helping consult publicly traded companies. Mr. Salazar is also a venture investor in a portfolio of energy and commodity startups, including startups extracting oil, natural gas, helium, and carbon dioxide, as well as engaged in the business of large scale carbon sequestration. Mr. Salazar has recently had large exits in Comstock Resources, Eclipse Resources, Torchlight Energy, as well as numerous privately held natural resource and commodity extraction ventures.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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