CEP did an excellent job of hedging, and while I have been negative on them, they also recognize that their drilling is economic in this price environment. They are instead opting to pay down debt. I built a spread sheet for all of their hedges and it looks like they should be able to stay alive for another 3 or 4 years. They can almost certainly get debt down to around $100 million by the end of 2014, perhaps as low as $70 or $80 million if they abandon all drilling. 2014 is when the hedges run out. They really need to do a recap, move into oil production and essentially, the natural gas assets can be on the back burner. If prices ever rise, they can evaluate development of them, but given the economics of the shale plays, I find it hard to believe that the coal bed methane fields will ever be anything more than marginal demand suppliers.
So, essentially, they should recap, let the natural gas proceeds pay down the debt and when the hedges run out, the company would be left with some debt that would have to be carried by the oily assets acquired after recap.
The other way to look at is that the gas assets are a nice call option on gas prices. If gas prices climb to $6/mcf, CEP could ramp up production and attempt to whittle that debt down even further.
Main point is that the company has value simply in the corporate struture as an MLP. They could raise equity, acquire oily assets, reinstate a distribution, albeit a small one, and the equity would rise in value. Repeat over and over again until such time as the original assets are just a small portion of the whole company.