I have decided to add Journey Energy to our Small-Cap Growth Portfolio. Below is a link to today's interview on the Korelin Economic Report.
https://www.kereport.com/2024/06/25/journey-energy-introduction-to-a-growing-oil-and-gas-producer-operating-in-the-duvernay-west-shale-basin/
JRNGF is currently trading at $2.23US. My initial valuation is $4.50US.
Journey Energy (JOY.CA and JRNGF) Update - June 25
Journey Energy (JOY.CA and JRNGF) Update - June 25
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Journey Energy (JOY.CA and JRNGF) Update - June 25
What is Diversified Energy (DEC)? Apparently it just got an NYSE listing and is starting to get analyst coverage. People on VF have been talking about its odd structure for months. I have not bought any, but am tempted by its yield.
Re: Journey Energy (JOY.CA and JRNGF) Update - June 25
DEC is a small company with a market-cap of $623 million. I do not cover it.
Diversified Energy Company PLC operates as an independent owner and operator of producing natural gas and oil wells primarily in the Appalachian Basin of the United States. The company is involved in the production, marketing, and transportation of natural gas, natural gas liquids, crude oil, and condensates. Its assets consist of natural gas wells and gathering systems located in the states of Tennessee, Kentucky, Virginia, West Virginia, Ohio, Pennsylvania, Oklahoma, Texas, and Louisiana. The company was formerly known as Diversified Gas & Oil PLC and changed its name to Diversified Energy Company PLC in May 2021. Diversified Energy Company PLC was founded in 2001 and is headquartered in Birmingham, Alabama.
June 10 Press Release:
Diversified Energy Company plc DEC has completed the acquisition of a proportionate working interest in certain assets from Oaktree Capital Management. The assets are located within the company’s Central Region, in Oklahoma, East Texas and Louisiana. Diversified Energy announced the acquisition in March 2024, valued at $410 million before customary price adjustments.
The acquisition was completed at a net purchase price of $377 million, after applying customary price adjustments. The company will pay $83 million of the total consideration in deferred cash payments to Oaktree. DEC also assumes Oaktree's proportionate debt to be approximately $120 million.
The acquired assets currently produce approximately 122 million cubic feet equivalent per day (MMcfe/d). These include Proved Developed Producing (PDP) reserves of 510 billion cubic feet equivalent (Bcfe). The value of the PDP reserves at PV10 is estimated to be $462 million. DEC expects Adjusted EBITDA for these assets in 2024 to be approximately $126 million.
In addition, the company has also concluded an acquisition-related review of its revolving credit facility. The borrowing base of the revolving credit facility has been redetermined and increased to $385 million by 26%. Following the increase in its revolving credit facility, DEC estimates that it will have an available liquidity of $130 million after accounting for the acquisition.
Diversified Energy has highlighted that the deal with Oaktree was a unique opportunity for the company to consolidate its assets. Management has also mentioned that the company will keep a disciplined approach and continue focusing on accretive acquisitions that will enhance scale and boost free cash flows for the company.
Zacks Rank and Other Key Picks
Currently, DEC carries a Zacks Rank #1 (Strong Buy).
Diversified Energy Company PLC operates as an independent owner and operator of producing natural gas and oil wells primarily in the Appalachian Basin of the United States. The company is involved in the production, marketing, and transportation of natural gas, natural gas liquids, crude oil, and condensates. Its assets consist of natural gas wells and gathering systems located in the states of Tennessee, Kentucky, Virginia, West Virginia, Ohio, Pennsylvania, Oklahoma, Texas, and Louisiana. The company was formerly known as Diversified Gas & Oil PLC and changed its name to Diversified Energy Company PLC in May 2021. Diversified Energy Company PLC was founded in 2001 and is headquartered in Birmingham, Alabama.
June 10 Press Release:
Diversified Energy Company plc DEC has completed the acquisition of a proportionate working interest in certain assets from Oaktree Capital Management. The assets are located within the company’s Central Region, in Oklahoma, East Texas and Louisiana. Diversified Energy announced the acquisition in March 2024, valued at $410 million before customary price adjustments.
The acquisition was completed at a net purchase price of $377 million, after applying customary price adjustments. The company will pay $83 million of the total consideration in deferred cash payments to Oaktree. DEC also assumes Oaktree's proportionate debt to be approximately $120 million.
The acquired assets currently produce approximately 122 million cubic feet equivalent per day (MMcfe/d). These include Proved Developed Producing (PDP) reserves of 510 billion cubic feet equivalent (Bcfe). The value of the PDP reserves at PV10 is estimated to be $462 million. DEC expects Adjusted EBITDA for these assets in 2024 to be approximately $126 million.
In addition, the company has also concluded an acquisition-related review of its revolving credit facility. The borrowing base of the revolving credit facility has been redetermined and increased to $385 million by 26%. Following the increase in its revolving credit facility, DEC estimates that it will have an available liquidity of $130 million after accounting for the acquisition.
Diversified Energy has highlighted that the deal with Oaktree was a unique opportunity for the company to consolidate its assets. Management has also mentioned that the company will keep a disciplined approach and continue focusing on accretive acquisitions that will enhance scale and boost free cash flows for the company.
Zacks Rank and Other Key Picks
Currently, DEC carries a Zacks Rank #1 (Strong Buy).
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Diversified Energy
I don't own it but have looked at it.
Couple of things that are different than others.
1. They term out their debt and
2. Heavy hedges, 90 % or more for multiple years
3. They pick up wells that original producers owned for a few years so the drop off in production year to year is less.
4. They have abandon well exposure when they finally shut them down.
5. They don't drill, they acquire the properties.
The used to be on London Exchange now they have a US listing.
Couple of things that are different than others.
1. They term out their debt and
2. Heavy hedges, 90 % or more for multiple years
3. They pick up wells that original producers owned for a few years so the drop off in production year to year is less.
4. They have abandon well exposure when they finally shut them down.
5. They don't drill, they acquire the properties.
The used to be on London Exchange now they have a US listing.