Energy Prospectus

bellwj

Wall Street's reaction this morning appears to be more 'kick to the curb'. Any thoughts on why the reaction was so negative in a strong up day?

bellwj

So who stands to gain most from increased use of 'fine sand'?

bellwj

It will be interesting to see if 'the fix was in' in the recent HUGE share offering of LONE. Having been trading in the $8-9 range, with outside fair value estimates well in excess of that (Dan, your estimate had been over $20?), one wonders why management settled on a price of $5.75. They certainly...

bellwj

f you own LONE, I highly recommend that you listen to their Q3 conference call and follow along on the slides. I have updated my forecast model for LONE and posted it to the EPG website. Your comments from a month ago. What has changed? This will sound a bit strange: 1. I am very bullish on LONE and...

bellwj

WOW! 36000+ shares traded on Friday per Yahoo Finance, almost triple the biggest day of the past 30 trading days. Six of the past 30 days have had trading volumes of 1000 shares or less. If management's reason for the reverse split was to make the stock more tradeable, it seems to have been a comple...

bellwj

Given Dan's estimate of cash flow (post split), this is either a screaming buy or dead-money loser. Hoping the problems with brokerage accounts have gotten people to throw in the towel.

bellwj

Now that EPM has settled their litigation with DNR, which gave them enough cash to fund their portion of the Delhi LPG removal project, any thoughts what they may do with their cash flow--especially if oil prices do what you think they will? Some possibilities Increase common dividend Redeem preferr...

bellwj

The market seems to think VNR is toast. Everything else suggests the company may survive. Be interested to hear if this improves Dan's rather dour forecast from last week.

bellwj

Curious whether I missed the VNR update.

bellwj

Based on the activity levels of the past week, it appears the buying frenzy is over, at least for now.

bellwj

I don't follow all of the companies tracked by EPG, but I don't remember seeing much, if any, insider buying since the beginning of the year. Could it be that they are not as bullish on an oil price recovery?

bellwj

Let me understand this. U.S. production is falling, but storage is growing. That tells me the real price of oil is below WTI, or why wouldn't the refiners reduce imports?

bellwj

At a price of $2.50 for GST PrA, the market is saying there will be a long wait for any future dividends. More to the point, the outlined plan suggests the company will survive 2016. What it does not address is how they are ever going to be able to develop the 100+ Meramec drilling locations which s...

bellwj

I can accept your premise (SWAG as you would say) that preferred dividends will be suspended after March. If they choose this course of action, I see little in the way of catalysts to suggest dividend payments would resume before the looming bond issue in 2018 is settled. Am I missing something?

bellwj

Thanks for the feedback.

bellwj

One of the major issues the negative articles in SeekingAlpha focused upon was that capex exceeds operating cash flow in 2016 despite the hedges. Dan, your spreadsheet seems to confirm that, though the numbers are a lot closer. The normal way to deal with that is through debt, equity, or capex reduc...

bellwj

Crushed today on no apparent news. Most of their production for 2016 is hedged, as well as a decent amount in 2017. Any comments?

bellwj

Obviously looking in the wrong place, but I couldn't find anything about GST on the web site. Directions please.

bellwj

Dan, now that you are back from the cruise, can you comment on Michael McCown's (apparently) abrupt retirement from GST. It may have been a natural or scheduled thing, but a late Friday announcement of a next Monday retirement is rare for senior execs unless there is more to the story.

bellwj

That may very well be. However, it is extremely rare for any executive, let alone the COO, to announce a retirement on Sunday afternoon, effective the next day, unless there is some other reason.

bellwj

Michael McCown, Gastar SVP and COO, has elected to retire effective Feb. 1 (tomorrow). Generally, when a person retires effective the next day, it isn't a good sign. Dan, you know many of the players at GST. Is this newsworthy?

bellwj

SM totally tanked today on no apparent news. Any insights?

bellwj

Interesting idea, though obviously risky. What is the cusip number for the bonds?

bellwj

Found it. Thanks.

bellwj

What about hedges in 2017?

bellwj

It looks to me that a number of posts from yesterday are missing/deleted.

bellwj

Dan, let me sharpen my focus a little bit. What is the investment community failing to see that you do that has resulted in GST preferred securities trading at near-bankruptcy levels? I sense the answer is that oil prices will rebound significantly in 2016.

bellwj

Clearly a significant part of the investment community does not share your views on the sustainability of GST preferred dividends, as the imputed dividend yield is approaching 25%. Hope you are right.

bellwj

Looks like the Gastar preferreds are back on a waterfall, similar to late September. At that time, Dan suggested a big fund was liquidating their position. Wondering if this is deja vu all over again (tip of the hat to Yogi), or if the test results from Oklahoma were not as good as many expect.

bellwj

Thanks

bellwj

EPM is fiscally very conservative, but to some extent does not control its own destiny since DNR is the operator of the Delhi field. DNR's financial condition doesn't appear bad, but one wonders what would happen to the Delhi field if DNR's financial condition were to deteriorate further.

bellwj

I expect this will be a major depressant on the price of oil. 5 million bbls a year doesn't sound like much, but it won't take our august solons long to decide to sell more in lieu of exercising fiscal responsibility.

bellwj

All of the reasons sound good, but this is a stock that is trading like GST is going out of business. Will everyone continue to love GST-P at $10?

bellwj

Since (roughly) the beginning of July, Callon Preferred is down 15%. GST Preferred is down 35%. Same market, similar (?) fundamentals, why the big difference?

bellwj

Clearly the market isn't enthused about the prospects for the Meramac well if the fall in the stock price is any indication. Is there something I am missing?

bellwj

Not sure how this will affect the E&P companies-other than to narrow the Brent-WTI spread. It's obviously a good thing for the 'sweet crude' refineries elsewhere.

bellwj

It certainly feels like the village idiots are in charge. Perhaps those of us holding GST Pr A or B should check and see whether we are in charge.

bellwj

I doubt this is the reason that SM has tanked so badly in the last six weeks--down 25%. Any thoughts on why the almost straight line dive since mid-May?

bellwj

Kind of interested to see that EPM just announced a common stock repurchase of up to $5MM. I thought they might have chosen to redeem some of their outstanding preferred shares.

bellwj

A math lesson: The U.S. now produces about 9.4 million bbls of crude oil per day. Approximately 4.0 million bbls per day comes from shale wells that have production decline rates of 30% to 50% per year. What will happen when the number of horizontal shale well completions falls off by 50%? The U.S. ...

bellwj

I must be missing something when I see 'temporary Houston ship channel closure forces reduced refinery runs' on the same page as 'Cushing inventories overflowing'.

bellwj

Slightly down and slightly up hardly justifies a 15% move.

bellwj

Gasoline inventories are up. Crude inventories are (almost) overflowing. Yet, gasoline prices are up (ex California) by 15%. What am I missing other than the stale tale about refineries converting to summer (presumably more ethanol) blends.

bellwj

FXEN has doubled in 4 trading days on no news (or at least unpublished). Either major short covering or else.??.

bellwj

Thanks. Found it.

bellwj

VNR produced a matrix a month ago showing dividend coverage under various situations. I can't find it. Help please.

bellwj

Maybe they all believe $70 oil.

bellwj

I have seen nothing recently regarding the timing of EPM's reversionary interest in the Delhi field. Last I saw was that it was expected to occur in October. Any other news?

bellwj

There have been an increase in the number of attacks on pipelines in Colombia as part of negotiations and the run up to the elections. Has this impacted GTE operations to any extent?

bellwj

I thought the same thing, but must admit I am baffled by the decision to issue new preferred stock at a rate of 10+%. Maybe the cash flow issues aren't totally resolved with the Cubic sale.

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