Please take the time to listen to today's presentation by John Walker. A few key points were as follows:
1) JW believes $15k per acre is a floor with much higher valuations likely in the oil & NGL window;
2) Company will be patient with regards to Utica. Have done numerous studies concerning how to maximize value. Expect to open a data room late in the 2nd quarter;
3) JW has 30 or so new best friends (i.e. national and multi-national companies approaching him about the Utica);
4) The interest is so high that they (the potential bidders) are proposing their choice properties as part of an asset swap, properties which JW stated you would never have suspected but they clearly want in to the Utica;
5) Will be increasing their borrowing base to accommodate the Barnett transactions and forgo any normally expected secondary share offering since anything the company does in the Utica is going to bring in either a significant amount of cash and or income producing properties.
The direct source for the info was John Walker. EVEP entered a deal with Apache in 2008 which gave Apache the right to drill EVEP's Austin Chalk acreage overlaying the Eagle Ford and EVEP would get 25% of the production. Apache drilled a number of wells and discovered the clay problem.
Apache may well have other Eagle Ford exposure ex. the EVEP venture but I don't follow Apache and therefore don't have this information.
If you want to check on Apache's Eagle Ford
exposure you can go to the Texas Railroad Commission website which lists every well ever permitted in Texas.
Thanks for the info. I wasn't aware that EVEP's stake in the Eagle Ford Shale was "clay" impaired. Were Apache's wells a bust? If you have a definitive source for this info, I'd like to read about it in greater detail.
Thanks in advance.
although they have a lot of acreage that overlies the Eagle Ford it is not in the right area and has too high a clay content to be economical to frack. Therefore, there is no Eagle ford play in EVEP.
Hello Roger, I have around $15,000 an acre on the CHK sale. 25% of 570,000 acres is 142,000 acres. 142,000 X $15,000 would get 2.13B Is this correct, or is my math off? At $11,000 they would have only $1,562,000,000. I know the figure was more than 2.13B , but was rounding the figures off to make it easier.
I agree. Very well done..not to mention educational. To my point: Not to be morbid, but at age 65 and with a degenerative situation,I'm looking at about 5 years..not too bad. I am going to stipulate many things in my will. Not the least of which will be my grand children (5 and counting) not receive a cent until they reach age 30 and have a more mature grasp on things financial.
I've seen too many friends give 6 figures to teen agers and 20ish types. After a Corvette, a down payment on more house than they need..like Keyser Söze...it's gone.