jrad I have to disagree with you that the carrying value of the assets (net book value) on the BBEP is not inflated. There are two tests that you or anyone else can make and that I present to prove my point
1-You may not be aware; but each year end "all" E&P companies are required by FASB/SEC to perform a cash flow/npv calculation on the carrying value of each of their properties.
The calculation uses year end prices and projected production/decline curves and inflated operating costs to arrive at net cash flow. If on an undiscounted bases the projected net future cash flows exceed then carrying value of each property/lease then nothing further is done. If the projected undiscounted future net cash flows are less then the carrying value; then a npv of the cash flows is ran and the property/lease is written down its NPV. If have not seen any disclosures by BBEP that they have made an material year end write downs which implies to me the carrying value of the properties on the books is not over inflated
2- You may be aware but in addition to the carrying value test of their assets; each E&P company is required to present the (after tax for c-corps) future NPV of reserves on proved properties, discounted at 10%, using constant yearend prices and operating and development costs. It is called Standardized Measure and is part of the supplemental information at the end of the financial statements. At year end 2010 the SM value of BBEP's proved properties was $1.064 billion dollars. This value does not include value for undeveloped properties and other assets. So even the SM of $1.064 billion on only proved properties at a 10% discount exceed the market cap of $1.04 billion
Hope this provides more background on why BBEP's net book value is inflated as you indicated