Parsley Energy (PE)

[dan_s]

Parsley Energy has posted a new presentation to their website. Here is a direct link.

http://www.oilandgas360.com/analytics/P ... pdf?a1fb5b

They recently acquired the mineral interests under a lot of their Permian Basin leasehold. This deal significantly increases their NRI. In addition to increasing their revenues, it will increase their proven reserves.

[ChuckGeb]

I think a closer inspection indicates the mineral acquisition has negligible impact on production (280 bbl/ day) and reserves. Parsley is just getting started in the Southern Delaware Basin. Thus one might say that the acquisition with the concurrent share issue is not immediately accretive. Time will tell if this acreage is as productive as theirs in the Midland Basin.

[dan_s]

Parsley has a sharp team. My bet is that they think they got a heck of a deal on the mineral rights or they would not have pulled the trigger. They are sure to focus more drilling on leases where they have the higher NRIs.

My valuation is only slightly higher than the First Call price target.

Also, take a look at RSPP. PE and RSPP remind me of FANG a year ago. All three have a lot of running room in the Permian Basin.

[ChuckGeb]

I am very bullish on Parsley. Top notch team.

[ChuckGeb]

According to WSJ article today, there were 10 times the orders to supply for their recent 200 million junk bond offering. Very bullish.