Energy Prospectus

KGardiner

Dan,
Is this a 7% dilution of stock?
Kevin

KGardiner

Thanks for the great links! Perhaps I’m parroting Goehring & Rozencwajg, but when over-investment in oil and gas creates a structural oversupply, two critical things happen: First prices plummet for an extended period. To survive, producers must keep producing, but low prices leads to consolidat...

KGardiner

The latest European ENSO forecast shows that the La Nina is ending quicker than expected. By summer it will be replace by an El Nino. I expect this forecast trend to reduce the summer build, but also reduce next winter's draw. I'll be watching it closely, but my best guess is peak Nat Gas prices in ...

KGardiner

While KRP continues to offer a nice dividend, currently around 12%, its Total Return the past 3 years is basically 1%. Year to date, price is down nearly 30% and total return is down 21%. I understand low oil and gas prices played a role, and the Tarrif Tantrums in April dealt a big blow for a Non-O...

KGardiner

Thanks Dan and Harry,
That makes a lot of sense.

I did own both, so the merger means Viper is my 7th largest holding. KRP remains my largest position, but it’s down a bit due to soft gas prices right now.

Kevin

KGardiner

Dan,

Just finished reading the updated VNOM profile. Much appreciated!

One question: How long do you think it will take Viper to get it's debt down to the $1.5 billion level at projected FCF ?

Thanks
Kevin Gardiner

KGardiner

HP has done a triple bottom since mid May. In the past 2 days it has jumped up 9%. I don't see any obvious news as to why. However, it certainly makes sense to me. The best driller was down over 70% from its 2022-23 highs. With oil in the dumps, its only a matter of time before prices rebound and dr...

KGardiner

What do you guys think about this lawsuit?

https://www.businesswire.com/news/home/20250701737570/en/Civitas-Deadline-Today-Rosen-Law-Firm-Urges-Civitas-Resources-Inc.-NYSE-CIVI-Stockholders-with-Losses-in-Excess-of-%24100K-to-Contact-the-Firm-for-Information-About-Their-Rights

Kevin

KGardiner

HP pays a nice dividend of 5.5% or $1.00 per share. Since early February, the stock has suffered a 43% drop. When compared to OIH which is currently down 18% over the same period, HP is seriously undervalued. Technically it still looks weak. The stock price has returned to mid 2020 COVID lows, down ...

KGardiner

With Trump's announcement today of Nuclear Talks progress, oil prices have dropped once again on fear. My question is: How much additional supply can Iran really put onto the market? For the past 4 years they've been evading or ignoring sanctions with the help of China. Last year oil averaged around...

KGardiner

Thanks Dan

KGardiner

Over the past few years I've seen a number of these scary warnings on Seeking Alpha on energy stocks. This one from yesterday regarding VNOM Viper Energy has me scratching my head. Can anyone explain to me what this is about? Or is this simply a case of some automated moron that doesn't understand t...

KGardiner

It seems to me that producers would not be in any hurry to deploy more rig and frac crews until there is more certainty. Rushing back in could be costly. Holding back sounds like more revenue with less CapEx to me.

KGardiner

I found this MacroVoices interview with Dr. Anas Alhajji to be very enlightening.

https://www.macrovoices.com/1416-macrovoices-479-anas-alhajji-what-do-saudi-arabia-allies-in-opec-want-from-accelerating-the-unwinding-of-voluntary-cuts

Kevin Gardiner

KGardiner

Does anyone know what percentage of CapEx might be subject to tariffs?

This is not something I have any clue about, but it seems to me that the tubular steel is a big expense.

Thanks
Kevin Gardiner

KGardiner

Dan, I greatly appreciate your Forecast Models. Yesterday I downloaded all of them and adjusted the Oil prices going forward to see how earnings are impacted, and at what oil price earnings go negative. I kept Nat Gas unchanged because I think your forecasts are good. The worst companies I found wou...

KGardiner

Thanks Dan

KGardiner

Dan, is there an updated AM Forecast post earnings?

Thanks
Kevin

KGardiner

Thanks Harry, While some folks still debate if G&R are correct that the US is now in depletion, it is certainly true that insufficient investment is leading to reserves depletion. Drill Baby Drill is just slurping our way to the bottom of the milk shake faster. If Bessent gets his way and we mag...

KGardiner

I think this means that Drill Baby Drill is Dead! If any producer thinks drilling themselves into oblivion will ever be acceptable again, just look at Civitas! Imagine a company wanting to pay down their debt, only to be rewarded by a massive selloff because investors demand most of the FCF. Persona...

KGardiner

As of 7am Central Time this morning, Everything is Green on CelsiusEnergy.net ! I don't think I've ever seen everything green! Also, on the NOAA ENSO Blog it looks like the La Nina will be ending by April and replaced by neutral conditions. https://www.climate.gov/news-features/blogs/enso So more co...

KGardiner

-321 withdrawal for Jan 24th puts us 111 bcf below the 5 year average!

KGardiner

Speaking of market manipulators; I’ve never really understood the IEA’s game. If they want to increase the World’s carbon emissions, then keep trying to talk down oil prices so we will all consume more. Yet they say we need to reduce emissions! So talk prices up instead. Which is it??? Make up your ...

KGardiner

It seems simple enough to me. If I have Auto-Reinvest Dividends set on a stock, I get whatever the price is on they Dividend Date. If the company takes that same Returned FCF and selectively chooses when to buy back stock, I hopefully get a better price for my Return. Am I missing something here? Ke...

KGardiner

Thanks Harry,
Glad to see they are buying back shares on the cheap!
Kevin

KGardiner

76 bcf is the average build for this week.
So +4 above 5 year avg.

KGardiner

Yes I remember the lateral spacing snafu. I thought it was pretty clear back then that Loredo did their mea culpa back then. They admitted their mistake and vowed not to repeat it. But I guess forgiveness doesn't come easy for these big Dogs.

Kevin

KGardiner

Thanks Guys, I remain Long Vital and don’t understand why there’s no love here. Is this still some Laredo hate story? As I recall there was no shortage of producers before 2020 that drilled as fast as they could no matter the price of crude. By that logic at least half of all producers should be in ...

KGardiner

Dan, do you see CRK permanently out of the running for the Sweet 16?

Kevin

KGardiner

Thanks for the HFI post Dan. I agree their faces should get ripped off, but they never seem to learn. Looking at the recent ZeroHedge post on OilPrice.com, I'm amazed just how far the Net Longs/Shorts went below the darkest days of 2020. I find it incredible that the oil market is so much worse off ...

KGardiner

Harry, I know you have specific criteria for a company to get on your Rankings List. I noticed the following EPG tracked companies are not on your list. AM Antero Midstream APA APA Corp ENB Enbridge PAA Plains All American Pipeline STR Sitio Royalties Corp I can understand pipeline and mineral right...

KGardiner

FYI, the Sitio Royalties Profile seems to have dropped off the High Yield page.

KGardiner

I love the smaller builds. The only downside is that with the current trend of warmer weather, there will be smaller draws once the heating season begins. So I have to hope we get to a Normal Winter earlier in winter. No doubt Celsius Energy is using the best forecast models for beyond November. Tha...

KGardiner

Harry, I've signed up for your reports. Thanks for your hard work and expertise. It is a great compliment to Dan’s work. I look forward to your weekly updates. One thing that would be very helpful to me is to receive your company ranking tables and associated metrics in Excel spreadsheet form in add...

KGardiner

Dan and Harry, I'd love to hear your perspective on the expected impact of an early 2025 recession on the oil and gas markets. It seems to me unemployment and jobs data is nearing a tripping point where no amount of Fed rate cuts will stop a recession. Also, credit defaults are starting to rise. Giv...

KGardiner

I agree that some sort of paper trade is at work. The game could go on for quite some time, but at some point producers cutting back, and low prices stimulating demand and economies will create such an inventory deficit, that the paper trade will break and break badly. Think 2008. I've no clue how l...

KGardiner

Harry, Thank you for your detailed explanation of your analytics. I look forward to receiving your periodic updates. One thing that would be very helpful to me is to receive your company ranking tables and associated metrics in Excel spreadsheet form in addition to your PDF file document. That would...

KGardiner

PE and Dan, I greatly appreciate your ongoing analysis of US and Canadian Producers long term outlook. When I look at oil and gas futures, I feel paper traders significantly discount the future price of oil and gas. No one is willing to honestly look at the combination of exploration and discovery r...

KGardiner

Currently 3.125 shares of CRGY is tracking very closely to SBOW.
Since SBOW doesn't pay a dividend and CRGY is currently paying $0.12 per quarter,
it seems to me I'd be better of selling SBOW and buying CRGY.

Thoughts?

Kevin

KGardiner

Thanks for the number crunching!

KGardiner

I voted opposite of Kimmeridge as well.
It may be good for them, but not for Silverbow or myself.

Kevin

KGardiner

Aside from gas under $2.00,

Is this fear of takeover the sole reason SBOW is down 15% since April 10th?

I for one am voting to make such a forced merger more difficult.

Kevin

KGardiner

I agree their hedging stinks.
On the plus side, I see more upside as a result from the market low, be it the early February or a late April 12 month low.

KGardiner

Dan, Thanks for the weekly update! Back at the start of February there was a lot of negativity around AR and CRK due to weather and Freeport. At the time I mentioned this was a good entry point. It turned out to be the bottom. Given the likely upside once the new LNG capacity starts coming online, w...

KGardiner

Thanks for the perspective Fraser.

And yes I did see the Nvidia vs Oil market cap news.

KGardiner

In the past 6 months SBOW down 29% CRK down 40% I'm looking at the current situation as a potential buying or rebalancing opportunity. With the forecast the next few weeks looking colder, and additional LNG capacity coming online later this year and early next, I feel waiting too long could be costl...

KGardiner

Freeport down to half capacity again!

We need more LNG capacity just from a reliability perspective.

Kevin

KGardiner

Thanks Dan,
In the future I will message Sabrina.
Kevin

KGardiner

I'm also looking for the ENB forecast.

KGardiner

Dan,
I'm looking for the most recent FANG Forecast Model under the High Yield tab.
Can someone add the link?
Thanks
Kevin

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