Energy Prospectus

can you elaborate with the explanation of reducing capex by same amount as stock buy back? i'm like the guy that said that sure is strange---just exactly how does it help. (for those of us that are not balance sheet experts).

"capex" = their capital expenditure budget for 2012, which is now set at $1.35 Billion (see slide 22 of their November presentation for details). In addition to the amount above, DNR expects to spend $250 million on stock buybacks. So, a total of $1.6 billion is what they expect to invest next year.

DNR has a flexible budget. They are committed to buyback their stock on the dips below what they believe is the value of their PDP reserves. If they spend more than the $250 million allocated to the stock buyback today, it will reduce other capital spending next year.

Money spend on the stock buyback will result in a debit (reduction) to the equity section on the Balance Sheet.

I hope this helps explain what DNR plans to do.

thanks, dan. it still seems to me that an increase in production would be looked upon better by the markets than decreasing the float. particularly after missing production numbers this year.

whenever a stock is below the nav it is usually due to market perception--lowering capex don't help that imo. all fwiw, of course.